WUHAN, China, Jan. 27 /PRNewswire-Asia-FirstCall/ -- China Automotive
Systems, Inc. (Nasdaq: CAAS) ("CAAS" or "the Company"), a leading power
steering components and systems supplier in China, announced today its
subsidiary Great Genesis Holdings Limited has signed a definitive agreement to
form a joint venture ("JV") with the Beijing Hainachuan Auto Parts Co. Ltd.
subsidiary of Beijing Automobile Industrial Holdings ("Beijing Auto"). The new
joint venture, Beijing Hailong Automotive System Co., Ltd., will design,
develop and manufacture both hydraulic and electric power steering systems and
parts at competitive prices to meet the growing power steering needs of
Beijing Auto.
The new JV will be a 50%/50% ownership between CAAS and Beijing Auto,
respectively. Four members of the JV's 7-person Board of Directors will be
appointed by CAAS with the remaining 3 members appointed by Beijing Auto.
A new production facility is expected to be completed and operational
within 18 months with a designed capacity for 300,000 units of hydraulic and
200,000 units of electric power steering systems plus parts. This structure
will be located approximately 70 kilometers from the Beijing airport and 110
kilometers from the port at Tianjin to provide
cost-effective shipping. The total investment is expected to approximate $20
million, with $10 million expended in the first 12 months, to be equally
shared by both JV partners.
The CAAS Research Institute will work closely with the Beijing Auto
Research Institute to develop the new steering models to meet the specific
needs for the vehicles produced by Beijing Auto.
Mr. Hanlin Chen, Chairman of China Automotive Systems, commented, "We are
very excited that Beijing Auto has selected CAAS as its trusted strategic
partner for these key safety-related steering units to support their expansion
plans. This JV is another milestone after our JV with Chery Auto in 2007, and
Beijing Auto adds to our list of leading Chinese brands who rely on us for
advanced, highly reliable steering units. Our new JV is further
acknowledgement of our design and manufacturing expertise."
Beijing Automotive Industry Holding Co., Ltd. is a state-owned enterprise
and has been a pioneer in China's automotive industry for a half century. It
is one of China's major auto production bases and among the 8 largest
automobile groups in China. It is comprised of tens of production factories
and research institutes to produce 700,000 vehicles per year plus parts, in
major categories such as jeeps, light-duty and commercial trucks, vans and
automobiles. Among its operations are Beiqi Foton Motor Co., Ltd., Beijing
Hyundai Motor Co., Ltd., Beijing Benz - Daimler Chrysler Automotive Co., Ltd.
and Beijing Automobile Works Co., Ltd.
About China Automotive Systems, Inc.
Based in Hubei Province, People's Republic of China, China Automotive
Systems, Inc. is a leading supplier of power steering components and systems
to the Chinese automotive industry, operating through eight Sino-foreign joint
ventures. The Company offers a full range of steering system parts for
passenger automobiles and commercial vehicles. The Company currently offers 4
separate series of power steering with an annual production capacity of over
2.5 million sets, steering columns, steering oil pumps and steering hoses. Its
customer base is comprised of leading Chinese auto manufacturers such as China
FAW Group, Corp., Dongfeng Auto Group Co., Ltd., BYD Auto Company Limited,
Beiqi Foton Motor Co., Ltd. and Chery Automobile Co., Ltd., etc. For more
information, please visit: http://www.caasauto.com
Safe Harbor Statement
This news release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. These forward-looking
statements are based on current expectations or beliefs, including, but not
limited to, statements concerning the Company's operations, financial
performance and condition and the impact of acquisitions on its financial
performance. For this purpose, statements that are not statements of
historical fact may be deemed to be forward-looking statements. The Company
cautions that these statements by their nature involve risks and uncertainties,
and actual results may differ materially depending on a variety of important
factors, including, among others, the impact of competitive products, pricing
and new technology; changes in demand for the Company's products; changes in
consumer preferences and tastes; and effectiveness of marketing; changes in
laws and regulations; fluctuations in costs of production, delays and cost
overruns related to developing and opening new production facilities; and
other factors as those discussed in the Company's reports filed with the
Securities and Exchange Commission from time to time.
For further information, please contact:
Jie Li
Chief Financial Officer
China Automotive Systems
Email: jieli@chl.com.cn
Kevin Theiss
Investor Relations
Grayling
Phone: +1-646-284-9409
Email: kevin.theiss@us.grayling.com
SOURCE China Automotive Systems, Inc.