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ASIA IS A BUSINESS IMPERATIVE… NOW MORE THAN EVER ASIAN AUTOMOTIVE NEWSLETTER Issue 44, September 2005 A quarterly newsletter of developments in the auto and auto components markets CONTENTS CHINA INTRODUCTION ................................................ 1 Asahi Glass Company (AGC) (China) has acquired CHINA ............................................................... 1 Qinhuangdao Haiyan Safety Glass Company INDIA ................................................................ 5 and is now the second largest auto glass producer INDONESIA ...................................................... 6 in China. AGC (China) is wholly owned by Asahi JAPAN .............................................................. 6 Glass of Japan. It invested more than US$33m in KOREA ............................................................. 6 the first phase project that is designed to have an MALAYSIA ........................................................ 7 annual production capacity of 1.6 million sets. The THAILAND ......................................................... 8 total investment has increased to US$61m and the VIETNAM .........................................................10 annual production capacity will increase by 1.2 million sets. (September 1, 2005) Benteler of Germany signed a JV agreement with Changrui Auto Pressed Parts Co in Changchun, INTRODUCTION capital of Jilin Province. The JV, Benteler Changrui Auto Systems (Changchun) Co Ltd, We hope you find the Asian Automotive Newsletter involves a total investment of Rmb215m (US$26m) informative. and will mainly produce auto replacement parts and systems. Benteler specially produces parts and BDA is a corporate finance advisory firm, which components for Benz and Volkswagen in Germany. assists multinational clients to identify, assess and (July 7, 2005) execute cross-border transactions involving Asia, including acquisitions, divestments, JVs and Bridgestone Corp has announced plans to set up restructuring. We have offices and professional R&D centers in Wuxi, Jiangsu. The tire-maker staff throughout Asia, and in the US and Europe. earlier this year set up its fourth China plant in Huizhou, Guangdong province to manufacture truck If you think that BDA’s services may be useful to and bus radial tires with production to start in you, please contact us at any one of our offices or January 2007. (August 26, 2005) email me at [email protected]. Contact details for our offices are at the back of this DaimlerChrysler has announced that it is raising newsletter. We look forward to speaking with you its stake in its Chinese JV, Beijing Benz in the future. DaimlerChrysler, from 42% to 50%. DaimlerChrysler paid a low double-digit million euro sum to increase its stake. The JV is to begin Charles Maynard production of the Mercedes-Benz E-Class in Managing Director Asian Automotive Newsletter Issue 44, September 2005 November this year with output of the C-Class and brought on line in 2007. Goodyear aims to sell and to follow. DaimlerChrysler also announced export as much as 200,000 tires in China within US$350m in additional spending to make Chrysler five years. The company has moved its Asia Pacific 300C sedans in Beijing with Beijing Automotive headquarters from the US to Shanghai and is Industry Holding Co, and build Mercedes-Benz deploying its nationwide standard service network Minivans in Fuzhou city and in Taipei. (September in the country now. (July 18, 2005) 16, 2005) Hyundai Mobis announced that it has taken over Fine Sinter Co of Japan will start manufacturing a JV set up by Kasco and a Chinese automobile operations in Wuxi, China this year. The company parts firm in Jiangsu Province. The acquisition of has completed construction on a 9,000-sq.-meter the venture, which produces brake and steering Wuxi facility slated to turn out 600 tons of sintered systems, will enable the firm to increase its annual parts in its first year. The sintered autoparts production capacity of chassis modules to 1 million manufacturer expects to invest around ¥2bn units by 2007. Mobis renamed the firm Wuxi Mobis (US$18m) in the project. The parts will be supplied after the takeover. Mobis also plans to establish to Toyota Motor and Japanese parts manufacturers new facilities in China to manufacture brake in China. (August 19, 2005) systems, steering pumps and steering assemblies. Wuxi Mobis is expected to produce up to 1 million Ford has raised its stake in Chinese commercial brake systems annually from the current 100,000 vehicle manufacturer Jiangling from 29.96% to units and up to 1 million steering pumps from the 30%. Ford bought 321,400 Hong Kong dollar- current 200,000 units. (July 28, 2005) denominated B shares worth about HK$1.1m (US$0.1m). Ford remains the second largest Hyundai Motor signed a preliminary agreement shareholder in Jiangling. Chinese company with Guangzhou Motor Group to set up a Jiangxi Jiangling Holdings owns 41.03%. US$1.2bn commercial vehicle JV. Hyundai and Changan Automobile said that it would offer Ford Guangzhou Motor will each spend US$430m as an option to buy another 7% stake in Jiangling after an initial investment in the JV, with the remainder three years. (August 11, 2005) being made by 2011. The venture, which will begin production in 2007, will have an annual production Fuyao Glass Industry Group, the largest auto capacity of 200,000 units by 2011. (June 21, 2005) glass maker in China, has launched three new float glass production lines. Fuyao has spent Rmb1.7bn Koyo Seiko Co has constructed an automobile (US$205.4m) on building the lines. All three lines bearing facility in Wuxi, Jiangsu Province, and one are operational and are predicted to generate in Foshan, Guangdong Province. The company 500,000 tons of float glass a year. Meanwhile, now has five bearing plants in China. The company according to a Rmb2bn (US$241.64m) agreement is investing some ¥4bn (US$36.3m) in the Wuxi signed between Fuyao and Hainan provincial site, installing production lines that will turn out government, the company will build five new float automobile bearings, while ¥2.7bn (US$24.5m) is glass production lines in Chengmai County in being invested in the Foshan facility, which will Hainan Province. The first three lines will start mass-produce hub bearings for the undercarriage construction in about three months' time and all of cars. The Wuxi site is wholly owned by Koyo five are expected to be launched by 2007. (June Seiko, and the Foshan facility is a JV with a 25, 2005) Taiwanese company. Both plants are expected to be in full operation in 2006. Demand for bearings Goodyear Tire & Rubber Company of the US is increasing in China as Toyota Motor and other said it will inject US$18m in producing RunOnFlat automakers bolster production in the country. tires in its Dalian plant. RunOnFlat tires will be (August 17, 2005) 2 Asian Automotive Newsletter Issue 44, September 2005 Kumho Tire Co of Korea and China’s First the Tan Chong Group’s 10% stake for around ¥1bn Automobile Works (FAW) have agreed to build a (US$9m), boosting its interest to 50%. Dongfeng US$150m tire plant in Changchun. Kumho will hold Nissan Diesel Motor is also to cooperate with a 90% stake in the new venture, and FAW will take Nissan’s Chinese unit Dongfeng Motor in the remainder. The new plant will merge with development, parts procurement and sales. (July Kumho’s plants in Nanjing and Tianjin, and it will 26, 2005) then become the major production base for Kumho in China. The plant is expected to commence NSK Ltd, a maker of automotive bearings, plans to production in 2007, enabling Kumho to increase expand production capacity at two factories in its annual capacity in China to 25 million tires. Jiangsu province in China. It will invest about (September 6, 2005) ¥1.5bn (US$13.6m) to increase production of automotive bearings at the facility that assembles Mahindra & Mahindra of India, which bought the the parts from 3 million units monthly to 5 million tractor-making assets of Jiangling Tractor last at the beginning of next year. These products will year, has started its China operations by rolling be delivered to customers such as a VW JV and out the first Mahindra & Mahindra-branded tractor Chinese automaker SAIC-Chery Automobile Co. in Nanchang, capital of Jiangxi province. Mahindra (August 23, 2005) has an 80% stake in Jiangling Tractor, a JV with JMCG, a leading automotive business group in Sanden Corp is building another automotive air Nanchang which holds the remaining 20%. The conditioner factory near Tianjin in a bid to keep Nanchang plant has an annual production capacity pace with rising demand there. The estimated ¥1bn of 12,000 tractors, and will export tractors initially (US$9m) project will be undertaken by Tianjin to North America, Europe and India. (July 8, 2005) Sanden Automotive Air-Conditioning Co, the Chinese production firm in which Sanden has a Nanjing Automobile beat out rival Chinese 52% interest. Work has already begun at the site, carmaker Shanghai Automotive Corp (SAIC) to and the new factory is slated to come onstream in buy the assets of bankrupt British carmaker MG summer 2006. The new plant will boost Sanden’s Rover and its engine producer Powertrain. Nanjing annual production capacity in China to 500,000 said it would relocate MG Rover’s engine plant and units, up from the current 100,000 units. some car production to China. However, it expected (September 2, 2005) to employ up to 2,000 British workers and produce at least 80,000 MG saloon and sports cars within Sensus Metering Systems of the US has agreed 5 years, and develop a research and development to set up a Sino-US precision die-casting company facility. A source familiar with the situation said in Yangzhou, Jiangsu Province. With a total Nanjing’s purchase price was between £50m investment of US$30m and a registered capital of (US$92m) and £100m (US$183.7m). (July 22, US$15m, Sensus-Rongtai Precision Die Casting 2005) (Yangzhou) Co will mainly engage in manufacturing and processing die-casting parts and accessories Nissan Diesel Motor plans to boost its interest in for automobiles.

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