Meath-based engineering company Timoney Technology has signed contracts to sell its suspension systems to Chinese group Sinotruck, the fourth-largest heavy truck maker in the world.

Established in 1935, Sinotruck has a network of 500 dealers, 50 marketing branches, 120 refitting units and 800 service stations in its home market. It also has joint ventures with Swedish truck group Volvo and Austrian engine firm Steyr.

Also known as China National Heavy Duty Truck Company, Sinotruck expects to benefit from a big rise in infrastructural investment in the vast Chinese market. The company will incorporate the Timoney suspension system into its range of construction, mining and oil exploration vehicles.

The deal could be worth €50 million to Timoney in the next two decades, Timoney said. In addition, chief executive Shane O'Neill said the arrangement with Sinotruck offered potential to increase international sales of the company's products.

"The Timoney independent suspension system will be manufactured by Sinotruk in larger volumes than ever before. Competitive pricing resulting from lower cost inputs in China could provide the impetus for independent suspension technology to penetrate the worldwide truck industry," he said.

"Independent suspension in the passenger car market is standard, but the truck sector has lagged the car market in this respect. Under the agreement, Timoney will retain worldwide rights for the sale of independent suspension modules manufactured by Sinotruk."

The Chinese company will invest up to €10 million in new manufacturing capacity within its own production system as a result of the deal.

While Timoney has developed products for the construction sector in the past, it described the Sinotruck deal as a significant breakthrough into the market in China. Sinotruck is the first Chinese company to adopt independent suspension technology into its heavy duty vehicles, said its chairman Ma Chun-ji.