Shanghai GKN Drive Shaft Co., Ltd. Business Report FY ended Dec. 2013

Business Highlights

Business overview

-The Company produced over 15 million constant velocity joints between January 1 and December 12. Its annual sales volume is expected increase by 16 percent from the 2012 level. (From news releases issued by multiple sources on December 23, 2013)

-The Company held a general meeting on January 11&12, 2013 to announce its business results for 2012 and its outlook for 2013. Sales during 2012 reached 5.36 billion yuan, up 20 percent year-on-year, with production of constant velocity (CV) joint drive shafts, its major products, hitting the record 12.16 million units by increasing 18 percent from the 2011 volume. The improvement pace even exceeded the market growth rate by 8 percentage points. In terms of business forecast for 2013, the company is expecting production of CV joint drive shafts to total 14 million units and overall sales to climb to 6 billion yuan. (From a press release, January 14, 2013)


-GKN Zhongyuan Cylinder Liner Co. Ltd., which is a subsidiary of the Company, annoucned that it has received U.S. Caterpillar’s Supplier Quality Excellence Process (SQEP) Gold Award. GKN Zhongyuan Cylinder has been supplying generator cylinder liners to Caterpillar since 2007. (From a press release, September 3, 2013)

-Shanghai GKN Drive Shaft Co., Ltd. announced that it has won 2012 supplier awards from more than 10 automakers in 2013: 
  • the Gold Award for High Product quality from Shanghai GKN; 
  • the Excellent Supplier Award from Shanghai GM; 
  • the Excellent Development Award from SAIC;
  • the Best Supplier Award from Dongfeng-Peugeot-Citroen Automobile Co., Ltd.; 
  • and the Excellent Quality Aaward from Changan Mazda.  (From a press release, February 8, 2013)

-In February 2013, the Changchun Plant of the Company obtained the TS16949 certification from NSF Shanghai Co., Ltd., a local certification body. (From a press release, February 25, 2013)


-The Company, a joint venture between GKN Driveline International GmbH (Germany) and HUAYU Automotive Systems Company Limited said that an agreement has been made between the two parent companies to extend the joint venture contract by 50 years. The signing of the agreement took place on April 18, 2013. The company also said that it will merge with GKN Driveline Torque Technology Shanghai Co. (TSH), a subsidiary of GKN, thereby changing its company name from Shanghai GKN Drive Shaft Co., Ltd to Shanghai GKN Drive System Co., Ltd. (From news releases issued by multiple sources on May 2, 2013)


R&D Facilities

-The Company has an Engineering Center in its Shanghai plant, where it conducts R&D and product inspection. The company has already acquired the government’s approval for the facility’s new testing laboratory.

-On July 18, 2013, the Company announced that its laboratory passed a testing conducted by the China National Accreditation Service for Conformity Assessment (CNAS) and received a national accreditation certificate. (From news releases issued by multiple sources on August 13, 2013)

Investment Activities

Investment in China

-On September 12, 2013, GKN Drive Shaft (Chongqing) Co., Ltd. laid a cornerstone for its additional facility at the Chongqing New North Zone. The company will invest approximately USD 43.9 million to construct a 12,000-square-meter factory. New operations are scheduled to begin in July 2014. The expansion project is expected to increase the company’s yearly production capacity to over 1 million sets. GKN Drive Shaft (Chongqing) was established jointly by GKN, Shanghai GKN Drive Shaft and Changan Automobile in August 2006. It mainly produces constant velocity universal joints for automakers such as Changan Ford, Changan Mazda, Changan Suzuki, Changan Automobile, Jianghuai Automobile, Great Wall Motor, Beijing Motor and SAIC-GM-Wuling. (From a press release, September 17, 2013)

-GKN Driveline, which is stepping up operations in China, has celebrated the opening of a second plant in Wuhan. The company has invested approximately 15 million pounds in the first phase of the construction project to set up a factory on 11,000 square meters of land. The new facility will produce precision driveline parts. It will be capable of manufacturing 11 million constant velocity joint drive shafts per year. (From a press release, July 19, 2013)

-On April 18, 2013, the Company has started constructing a new plant building in the premises of the Shanghai Shenjiang Plant, covering the additional 21,067 square meters. It will be completed in November 2013. The total investment is expected to amount to 100 million yuan. The new facility will have 8 driveshaft assembly lines, 2 environmentally friendly surface coating lines, 200 pieces of processing equipment and various cutting-edge testing devices. Having the capacity to produce hook joint-type drive shafts for 1 million vehicles a year, the plant will supply its products to automakers such as Shanghai VW, FAW VW, Sichuan Toyota, Mitsubishi Motors, Nissan, and Jiangling Motors.