Valeo Group (China) Business Report FY ended Dec. 2014

Business Highlights

Financial Overview

-In 2014, Valeo announced that its sales to automakers in China reached EUR 1.37 billion in 2014, up 28 percent from the previous year, accounting for 14% of the group. The number of contracts in China accounted for 24% of the Valeo Group, which reached EUR 17.5 billion in 2014.

Recent Development

-Shanghai Valeo Automotive Electrical Systems Co., Ltd., a subsidiary of Valeo, completed a new plant on a 80,000-square-meter-plot in May 2014. The plant would become one of the largest production bases of automotive electric components in China, with its annual capacity reaching 10 million sets per year. It would also become the Valeo Group’s largest plant in the global market. (From news releases issued by multiple sources on June 3, 2014)

New Company

-Valeo Automotive Air Conditioner Hubei Co., Ltd., a subsidiary of Valeo, established a new branch, Valeo Automotive Air Conditioner Hubei Co., Ltd. Changchun Branch, in Jilin province in November 2014.

Off the Production Line

-Shenyang Valeo Auto Lighting Co., Ltd., a subsidiary of Valeo, announced that it had held a ceremony to celebrate its 1 millionth automotive lamp rolling off its production line. Shenyang Valeo Auto Lighting is the largest automotive lamp supplier in Shenyang. The plant, which is located on 60,000 square meters of land, began mass production in September 2013.  (From news releases issued by multiple sources on October 23, 2014)

R&D structure
-Valeo employs over 3300 engineers in China. Valeo's continuous investment of over 5% of its annual sales in Research and Development has enabled the Company to bring to market the innovations that will support the Valeo's development in China in the coming years.

-The Valeo Engineering Hardware China in Shenzhen, which employs about 100 engineers and plans to recruit an additional 200 by the end of 2015, has reinforced the Group’s position in China.

R&D facilities

-Valeo has 3 Research Centers and 10 Development Centers in China as of 2014.

<Research Centers>

Name of facility Operating segment City  Overview
Valeo Wipers Systems Asia R&D Center Wipers Systems Shanghai -Providing technical support to its Chinese manufacturers, to which it supplies its products based on an OEM agreement.
-Providing technical support in Asia and emerging markets.
Valeo Global Electronics R&D Center Electronics Shenzhen -Research and development of electronic products.
Valeo Lighting Systems Hubei Technical Center Lighting Systems Wuhan, Hubei -Developing lighting system for the Chinese and the global markets.

New products

-Valeo showcased the following innovative technologies at Auto China 2014 held in Beijing:
·Full LED headlamps: Consumes only one fifth of energy used in halogen lamps. Offers greater design flexibility.
·eSkin 2 Console: Intuitive car connectivity solutions that provide drivers access to smartphone services and applications via the controls of center consoles.
·New air conditioner filters: Designed to meet stricter Chinese environmental standard that will become effective in 2016. Filter outs microparticles and superfine particles from the cabin.
·i-StARS starter-alternator: The Stop-Start system integrated with an alternator provides significant fuel savings. It reduces CO2 emissions by 6% in standard mixed cycle use, and up to 15% in city driving.
(From a press release on April 26, 2014)

Investment in China
-Valeo Automotive Air Conditioner Hubei Co., Ltd., a subsidiary of Valeo, established its fourth production base in Changchun, Jilin in November 2014, which was named as Valeo Automotive Air Conditioner Hubei Co., Ltd. Changchun Branch. The company is at the preparation stage. 90% of its products will be sold in China, and the other 10% of the products will be exported outside China, such as Japan.