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CONTINENTAL : Opens New Plant in Jinan, China

05/27/2011 | 03:45am US/Eastern

05/27/2011

  • Historic milestone and another step toward gaining a solid foothold in growing sector

Jinan, China, May 27, 2011. The international automotive supplier Continental today announced the grand opening of its fully-owned new production facility in Jinan, Shandong province – Continental Automotive Jinan Co., Ltd. This marks a new milestone in the company’s develop­mental roadmap in China, as it is Continental’s first facility in China that specializes in manu­facturing electronics for commercial vehicles and the aftermarket. The investment, valued at RMB 57 million, represents a significant step in Continental’s ongoing expansion strategy in the Chinese market. With the new location, Continental has created 210 employment opportunities, which is expected to double by 2015, and in total, Continental has increased its production facilities to 18, in addition to its 15 sales offices in China.

Mr. Jay Kunkel, Head of Continental China, said at today’s grand opening ceremony, “I am particularly pleased to witness the completion of our first wholly owned subsidiary for commer­cial vehicle original equipment and the aftermarket, as it represents a significant next step in our expansion plan in China while underscoring our commitment to the Chinese market to fulfill the demand of customers in various sectors. With the support of the Jinan government and the trust and dedication of our customers, we will drive our commercial vehicles and aftermarket opera­tions forward to meet the demands of local OEMs. With Continental’s vigorous gains in 2010 – realizing €26 billion in sales and €1.9 billion in EBIT, in addition to increasing its share of sales in Asia’s automotive business to 21 percent – we are confident in the growth opportunities in this important market, and are on the right track to achieve above-average growth in China.”

Assigned to Continental’s Commercial Vehicles & Aftermarket business unit, the new plant is located in the Lingang Economic Development Zone in Jinan, Shandong province, adjacent to Jinan International Airport.

Ranked third in terms of GDP in China in 2010, Shandong province is home to many key commercial vehicle and construction equipment manufacturers, and is where many of Continental’s important customers are based. In May 2008, Continental and China National Heavy Duty Truck Group Co., Ltd. (CNHTC, also known as Sinotruk), one of China’s leading commercial vehicle producers, signed a "Memorandum Agreement" and a "Strategic Cooperation Agreement" in November 2008, which led Continental to establish its new operational base for commercial vehicles in Jinan.

Dr. Michael Ruf, Head of the Commercial Vehicles & Aftermarket business unit, Continental Corporation said, “As figures have indicated, China is the largest automotive and commercial vehicle market in the world in terms of production volume, and is experiencing steady growth over the years. From 2012 onwards, nearly every second car worldwide will be manufactured in Asia, with China being the growth leader. Continental is poised to capture the potential in this market by providing a wide array of high performance electronics solutions for our local com­mercial vehicle and construction equipment manufacturers, with our global know-how and highly experienced technical support through technological innovations and localization.”

The new plant will initially focus on the production of instrument clusters for commercial vehicles in 2011, and is capable of producing 66,000 units per month, boosting total annual production capacity to as much as 792,000 units. The company also plans to include production of body and chassis electronics starting in 2012, to help meet increasing demand for highly-capable and cost-effective solutions for the local commercial vehicle and construction equipment manufac­turers. The total floor space of the new facility in Jinan is 21,169 m2.

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