BIZCHINA / Overseas Investment
Auto parts giant to double investment in China
(Xinhua)
Updated: 2006-11-23 11:09
The Bosch Group, the world's leading supplier of auto parts, is to double
its investment in China, injecting 620 million euros by 2008.
Bosch would not be making the additional investment if there had been no
increase in profits, said Peng Deyuan, president of Bosch (China)
Investment Co., Ltd.
Special coverage:
Auto China 2006
Related publication:
Related readings:
Tyre giant ready for productionCampaign girls at Beijing auto showAuto
industry profits up
Since the beginning of the year, the auto parts giant has invested 160
million euros in building two plants in Changsha, in central China's
Hunan Province and Suzhou, in eastern Jiangsu Province.
Another 100 million euros will be used to expand the two plants, Shanghai
Securities News reported Wednesday.
Peng said that Bosch will increase its sales in the Asia-Pacific region
to 25 percent of its global sales within eight years.
China and India are two of Bosch's fastest growing markets, with China
currently accounting for 15 percent of its Asia-Pacific sales and 2.5
percent of global sales.
China's auto parts industry is expected to be worth 800 billion yuan (100
billion U.S. dollars) in 2010, making the country the world's largest
destination of foreign investment in the sector, the report says.
With the world's major automakers showing off their new models at the
ongoing Beijing Auto Show, international auto parts giants such as Bosch,
Denso, Michelin and Siemens are vying for a share in the vast Chinese
market.
A number of auto parts suppliers have moved some of their plants to China
in order to reduce production costs. Chinese automakers purchase 80
billion yuan worth of auto parts every year.
This year, Delphi, Magna and other auto parts giants have set up ten
production bases across China, 90 percent of which are fully owned
subsidiaries. These multinationals have also invested hundreds of
millions of yuan in building their own research and development centers
in the country.
There were 4,447 auto parts producers in China in 2005, with a total
sales volume of 344.9 billion yuan and profits of 20 billion yuan,
accounting for 29 percent and 38 percent of the country's auto industry,
according to the China Automotive Industry Association.
Meanwhile, many foreign automakers have begun purchasing auto parts from
China, giving an impetus to the country's auto parts exports, which
reached 8.53 billion U.S. dollars in 2005, outperforming imports of 8.38
billion U.S. dollars for the first time.
(For more biz stories, please visit Industry Updates)
Learn Chinese
