Cars

US automobile parts maker gearing up in China

By Li Fangfang (China Daily)
Updated: 2010-11-04 13:25

NANJING - US automobile parts maker ArvinMeritor Inc started building facilities worth $16 million on Wednesday in Nanjing, Jiangsu province, as part of a series of investments in the Chinese market for the next five years.

"The new facilities will accelerate our company's ability to provide dedicated engineering capabilities, advanced product solutions and localized production for the customers in China, the world's biggest heavy-duty commercial vehicle market," said Tim Bowes, president of Industrial and Asia-Pacific for ArvinMeritor.

Bowes did not disclose ArvinMeritor's sales figures in China due to public company regulations, but he told China Daily that "if our business here is not growing satisfactorily, we won't bring more investments".

The company will focus its investments in China in the next five years and it aims to maintain a double-digit year-on-year sales growth, Bowes said.

"To support our growth objectives in China, we are expanding our manufacturing footprint and engineering capabilities to design, test and validate our products in China," Bowes said. "This facility will enable us to provide advanced solutions in drivetrain and braking products to our growing customer base in China. And in the next stage, we will invest more in manufacturing facilities."

ArvinMeritor's investment in Nanjing includes an $8 million technical center, which is expected to lead the company's design and engineering initiatives for its commercial and industrial drivetrain products in China.

The center will become the newest addition to ArvinMeritor's global engineering network, with existing facilities in the United States, Italy, the United Kingdom and India.

"The improving talent pool and the booming local market demand made us choose China to set up the fifth global technical center," Bowes said.

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In addition to the technical center and manufacturing location, the Nanjing facility will also become ArvinMeritor's central after-market center in China. As a global leader in after-market and remanufacturing services, this site will enhance the company's capabilities to service the domestic and regional marketplace.

China has been the biggest heavy-duty commercial vehicle market in the world for years.

Last year, the heavy-duty truck segment was boosted largely by an infrastructure construction spree triggered by the central government's 4 trillion yuan ($599 billion) stimulus package. The government's appeal for modern, high-efficient logistics operations also indicates the potential of the heavy-duty commercial vehicle market in China, analysts said.

"The potential and business opportunities in the heavy-duty commercial vehicle market are even bigger and more than those in the passenger vehicle market," Bowes said.

Volvo Group, the world's second-largest truck and construction machinery maker, told China Daily in an earlier interview that it expects Asia to overtake Europe as its top market by 2015, with China and India contributing 60 or 70 percent to total Asian sales.