Navistar International Corp. and Ford Motor Co. have struck a deal to use a new 6-liter diesel engine in some pickup trucks and sport-utility vehicles.

Dick Fotsch, president of Navistar's engine group, said in a released statement the 6-liter engine would replace a Navistar 7.3-liter diesel in some Ford Super Duty pickups and Excursion sport-utilities. "The new engine will boost fuel economy 10 percent and cut pollutant emissions 20 percent," he said.

Navistar has a 10-year contract for the engines, with production to begin later this year for vehicles available in early 2003. Annual output will be about 325,000 engines. Financial terms weren't disclosed.