Mando Corporation Business Report FY ended Dec. 2012

Business Highlights

Financial Overview (Consolidated)

(in millions of won)
FY ended Dec. 31, 2012 FY ended Dec. 31, 2011 Rate of
Sales 5,059,281 4,560,126 10.9% -Sales by customer (FY2012)
・Hyundai-Kia Group : Approx. 55%
・GM Group : Approx. 20%
Operating income 255,928 300,434 (14.8%) -
Net income 162,055 225,060 (28.0%) -

Establishment of new companies

-In September 2012, the Company established Mando China Holdings Ltd., a holding company in China. The Company will transfer the following shares it has in its subsidiaries to the new company:
  • 100 percent in Mando Suzhou Chassis System Co., Ltd.
  • 100 percent in Mando (Beijing) Automotive Chassis System Co., Ltd.
  • 100 percent in Mando (Tianjin) Automotive Parts Co., Ltd.
  • 80 percent in Mando (Harbin) Automotive Chassis System Co., Ltd.
  • 100 percent in Mando (Beijing) Automotive Components R&D Center Company Ltd.
  • 100 percent in Mando (Beijing) Trading Co., Ltd.
  • 65 percent in Mando (Ningbo) Automotive Parts Co., Ltd.
  • 100 percent Mando (Shenyang) Automotive Parts Co., Ltd. (From a press release, September 3, 2012)


-In August 2012, the Company was awarded a program from General Motors to supply electric parking brakes. The parking brakes will be installed on vehicles going into production in 2015. The supply agreement is expected to add 340 billion won to Mando's sales. (From a press release, August 28, 2012)

-In August 2012, the Company won a program from Nissan to supply electric power steering systems for the automaker's new model scheduled to go into production in 2013. Mando is expecting to generate 210 billion won in sales based on this agreement. (From a press release, August 28, 2012)

-In April 2012, the Company won a contract from Volkswagen to supply brake calipers. Starting in 2015, Mando will supply them to the vehicles produced in Europe, expecting to generate approximately 55 billion won in sales from this agreement. (From a press release on April 26, 2012)

<Hyundai Kia>
-In January 2012, the Company  won a supply agreement from Hyundai Motors to deliver suspensions, which are planned to be mounted on the successor models to the Genesis (Dev. Code: DH) and Equus (Dev. Code: HI). (From a March 20, 2012 press release)

Overseas Operation

-In November 2012, Mando-Hella Electronics Corp. (MHE) announced that Mando-Hella Electronics (Suzhou) Co., Ltd. (MHES) has started commercial production. MHES was established at the end of July 2011 in Suzhou, Jiangsu Province to produce electronic control units and sensors used in brake systems and steering system for automakers operating in China. (From a press release, November 21, 2012)

-In November 2012, Mando Corporation Poland Sp. z o.o. (MCP) started to mass-produce steering system products at its new plant. The products made in Poland will be mounted on the Hyundai i30, which is assembled at Hyundai's Czech Plant. The steering products will be also supplied to the Slovakian Plant of Kia Motors. (From a press release, November 19, 2012)

-In May 2012, the Company held a ceremony to commemorate the completion of a new factory at its subsidiary in Brazil, Mando Corporation de Brasil (MCB). The 13,200 sq. meter plant is located in Limeira, Sao Paulo and built on 55,520 sq. meters of land. It will produce 500,000 ABSs annually and plans to start delivery from September 2012 to Hyundai's and GM's transplants in the country. Going forward, Mando intends to boost the plant's annual ABS production capacity to 1 million units by 2016 and also branch out into the production of brake calipers and steering system parts. (From a May 25, 2012 press release)

-In December 2012, MCB announced its plan to step up production of ABSs from the current 520,000 units to 1 million units a year by 2016. MCB has been supplying ABSs to General Motors and steering systems to Hyundai Motor, with its sales expected to reach 56 million dollars in 2013. Mando is looking to add brake calipers and column type power steering systems to the subsidiary's lineup in the future. (From a press release, December 1, 2012)

-In April 2012, the Company announced that the new plant at its subsidiary in India, Mando India Steering Systems Pvt. Ltd., (MIS) has been completed. The new plant, which will build steering systems, will have an production capacity to produce 800,000 EPS (Electronic Power-steering System) units per year. It is planning to deliver the EPSs to Hyundai's and Nissan's transplants in India. By 2015, the plant plans to build its annual production capacity to 1.5 million units. The plant is built on 40,469sq. meters of land and the building has 11,638sq. meters of floor space. (From an April 25, 2012 press release)

-In July 2012, the Company established an office in Jakarta, Indonesia, called the Mando Jakarta Office (MJO). It will be responsible for developing business with new parts-suppliers in the country, aiming to locally procure approximately 270 types of parts by 2015. (From a July 10, 2012 press release)


-In February 2012, Mando (Beijing) Automotive Chassis System Co., Ltd., a subsidiary of the Company, announced that it won the Best Supplier Award for 2011 from Beijing Hyundai Motors. (From a February 1, 2012 press release)


-In October 2012, the Company announced that it would sell a 26 percent share in Mando India Steering Systems Pvt. Ltd. (MIS), its wholly owned subsidiary, to the Anand Group of India. MIS, which was established in 2006, generated 108 billion won in sales in 2011. Mando and the Anand Group jointly established Mando India Limited (MIL) in 1997, with Mando providing 66.7 percent and Anand 33.3 percent of the capital. (From a press release, October 29, 2012)

Business plan

-The Company announced that it aims to become one of the 30 largest auto parts suppliers in the world by 2015. It intends to achieve this target by increasing the ratio of business with customers other than the Hyundai-Kia Automotive Group. The ratio of sales to Hyundai-Kia, which stood at 56 percent in 2011 is expected to fall to 40 percent by 2015, while the percentage of sales to Chinese OEMs is forecast to climb from current 3 percent to 13 percent. (From a press release, December 3, 2012) 


R&D Structure

-In September 2012, the Company established the Mando Global R&D Center in Sungnam, Gyeonggi-do. The company's five development facilities in Pyeongtaek, Wonju, Iksan, Giheung and Bundang were integrated into the new Global R&D center. (From a press release, September 27, 2012)

-In August 2012, the Company and the Korea Automotive Technology Institute (KATECH) have jointly established Collaboration Lab. By integrating KATECH's advanced reliability testing technology with Mando's expertise in developing automotive components, Mando aims to further enhance the quality of its products. (From a press release, August 16, 2012)

<Research centers outside Korea>
-U.S. (Detroit, Michigan)
-China (Beijing)
-India (Haryana)
-Germany (Frankfurt)

<Winter Test Center>
-U.S. (Sault Ste. Marie, Michigan)
-China (Heihe, Heilongjiang province)
-Sweden (Arjeplog)
-New Zealand (Wanaka)

R&D Expenditure

(in millions of won)
FY ended Dec. 31, 2012 FY ended Dec. 31, 2011 FY ended Dec. 31, 2010
Amount 189,163 151,845 114,643
% of sales 3.7% 3.3% 3.2%

R&D Activities

-The Company's recent achievements include development of smart cruise control (SCC) systems, smart parking assist systems (SPASs) and Lane Keeping Assist Systems (LKASs).

Technological Alliance

-In November 2012, the Company signed a technology licensing-in agreement with Diamond Electric Mfg. Co., Ltd. of Japan. Based on the arrangement, Mando will introduce Diamond Electric's advanced technology in the area of on-board charging equipment to enhance its capabilities to design and manufacture automotive charging devices. Mando, which has been supplying its on-board chargers exclusively to Korean automakers, is now poised to expand its customer base in the global market. (From a press release, November 29, 2012)

Investment Activities

Capital Expenditure (FY ended Dec. 31, 2012)

(in millions of won)
Business division Investment programs Amount
Brake Revamping and expanding ABS production lines 26,086
Revamping and expanding caliper production lines 12,246
Revamping and expanding master cylinder and booster production lines 6,123
Others 23,009
Subtotal 67,464
Steering Revamping rack & pinion power steering production lines 8,653
Adding new production line to produce rack-type electric power steering systems 479
Revamping and expanding column-type electric power steering production line 11,904
Others 24,398
Subtotal 45,434
Suspension Revamping and expanding mono-tube damper production line 1,424
Revamping shock absorber production line 1,580
Others 5,413
Subtotal 8,418
Others 98,137
Total 219,452