GKN (China) Investment Limited Business Report FY ended Dec. 2017

Recent Development

-Shanghai GKN Drive System, a subsidiary of GKN began producing all-wheel drive (AWD) disconnect system for small- to medium-sized vehicles in China. The system reacts to driver inputs and road conditions to seamlessly switch between two-wheel drive and all-wheel drive. The clutch system improves fuel economy by up to 4% compared with standard AWD systems. If the driver requires more traction, the system reconnects within just 300 milliseconds. The system will be featured first on the Jeep Renegade built by GAC Fiat Chrysler Automobiles Co., Ltd. Shanghai GKN Drive Systems will manufacture the complete AWD system, including the power transfer unit (PTU), rear drive module (RDM), drive shafts and side shafts. It will also supply software control units. Shanghai GKN successfully localized the production of PTUs and RDMs for the 2015 Jaguar Land Rover models, including the Range Rover Evoque and Land Rover Discovery Sport. (From a press release on February 17, 2017)

Supporting Information

-In November 2016, GKN announced that it will continue to cooperate with the BMW Group on the e-Axle driving, and will support the e-Axle for the BMW X1 PHV in the Chinese market. Such system shall be supplied by the GKN's Italian Bruneck Plant, but the local-oriented development will be carried out in Shanghai. (From a press release on November 28, 2016)

Expand Production Capacity

--In July 2016, GKN Driveline announced that its Chinese joint venture, the Shanghai GKN HUAYU Driveline Systems (SDS) will add five four-wheel drive(AWD) system production lines in its two plants in Shanghai. The new production line will focus on the production of parallel transmission unit (PTU) and Rear-wheel drive module(RDM), it is expected that GKN's capacity of AWD system in China will be doubled when the production lines are added. In 2015, GKN began the local production of PTU and RDM for some vehicles like Jaguar Land Rover, Range Rover Evoque, Land Rover Discovery Sport and so on. In addition, it is scheduled to provide a large number of local production projects for various OEMs within the next two years. (From a press release on July 27, 2016)

R&D Facilities

-In April 2017, GKN announced that its subsidiary, the Shanghai GKN HUAYU Driveline Systems(SDS) will establish a new technology center in Shanghai, and this new center will create more than 300 jobs. It is estimated that by 2025, The SDS will produce more than one million eDrive system products per year, and from 2018, SDS will begin to produce multimode eTransmissions for Chinese OEMs. Furthermore, GKN’s first complete eDrive system will be in production in 2019, such system is a combination pack which integrates the electric motor, inverter and e-Axle reduction gearbox into a whole, and its is scheduled to be supplied for the first time for the small car platforms of European OEMs which will be sold worldwide.(From a press release on April 18, 2017)

-GKN has set a technical center in the Kangqiao Plant in Shanghai, which has a complete set of testing equipment for the functions and performance of drive shaft, and it is the fourth technology R&D center of GKN in the world. Its center laboratory has achieved state level Lab Authentication Certificate.