Shanghai GKN Drive Shaft Co., Ltd. Business Report FY2006-2007

Business Highlights

<New subsidiary>
- In November, 2006, the Company and China South Industries Automotive Holdings Co., Ltd. (CSIMC) jointly established GKN Drive Shaft (Chonqing) Limited (GDC) in Chongqing. The Company owns 50 percent, GKN of Germany owns 9 percent, and CSIMC owns 40 percent of GDC shares. GDC is registered at 50 million yuan (4.8 million euros). Its plant has a land area of 36,000 square meters next to Changan Ford Mazda's facility and is expected to manufacture 250,000 drive shafts in 2008. 
CSIMC is a holding company that has automakers such as Changan Automobile, Changan Ford-Mazda, Changan Suzuki, and Jiangling Motors in its holdings.

<Supply award>
- In September, 2007, the Company received a new contract to supply power transfer units for use in Chery's new SUV that will go on sale in 2009. The company will assemble the power transfer units at the Kangqiao Plant (Shanghai) of Shanghai GKN Drive Shaft Co., Ltd. The Shanghai facility will procure the majority of the components used in the units locally, but will import hypoid gearboxes from GKN Driveline Torque Technology located in Nagoya, Japan.