Delphi Group (China) Business Report FY ended Dec. 2017

Overview

-The Group has significantly grown its Chinese operations by establishing new companies and plants, especially in the area of thermal systems, electrical and electronic architectures, and electronics and safety systems. As the Group is working on increasing sales to major automakers in China, Delphi (China) Technical Center Co., Ltd. in Shanghai is developing products to satisfy local demand. Delphi Electronic and Safety System in China opened its second R&D center, Delphi Electronics (Suzhou) Technical Center, at the Suzhou Industrial Park in May 2014. It strengthened Delphi R&D system in China.


1.Electrical and electronic architectures Delphi Packard Electric Systems Co., Ltd. This company is one of the largest wire harness suppliers in China. It has a total of 14 manufacturing facilities located in Shanghai, Guangzhou, Changchun, Baicheng, Yantai, Wuhan and Wuhu.
2.Electronics & safety systems Delphi Electronics (Suzhou) Co., Ltd. This company manufactures cutting-edge car electronics and safety systems. The company’s products include in-vehicle entertainment systems and electronic control units.

Contracts

-On June 23, 2017, Delphi announced an agreement with Great Wall Motor regarding the supply of a series of its active safety solutions such as Intelligent Forward View (IFV) systems, Mid-Range Radar (MRR) and Short-Range Radar (SRR) to Great Wall Motor for the Chinese automaker’s next-generation sport utility vehicles (SUVs). The products are to be supplied to Great Wall Motor via Delphi’s plants in Suzhou, China, and Singapore. (From some releases on June 26, 2017)

New Plant

-Delphi is going to build a new remanufacturing base in Fushan District, Yantai City, to start remanufacturing and reprocessing several types of powertrain of the company. Its main products are high-precision parts of three major systems, control, sound and safety systems. Delphi group plans to set up a remanufacturing base in China by transferring all operations of its after-sales service division to Fushan. (From some releases on September 25, 2017)

-In November 2017, the groundbreaking ceremony of Delphi Powertrain Electrification and Electronics Suzhou Plant was held in Suzhou Industrial Park. The new plant of the project is located in the south of Zhongyuan Road and east of Xinghua Street in Suzhou Industrial Park, covering an area of 84 Mu; the total construction area of the Phase I will be 16,700 square meters, the Phase II will be processing workshop with the construction area of 6,000 square meters. This project has been started on November 28 and is expected to be put into use in January 2019, which will be able to provide key new energy components for major domestic automobile manufacturer so as to achieve the local service. (From a press release on November 28, 2017)

-On February 25, 2017, Delphi's electrical & electronic architecture business began construction of a new plant in Jingzhou, China. This plant will serve as Delphi China's 13th wire harness plant and 19th facility. It will be built on approximately 74,100 square meters of land. New operations are scheduled to begin in October 2017. The plant will have the capacity to produce 400,000 sets of automotive wire harnesses per year and supply these products to customers in Midwest China. (From news releases issued by multiple sources on February 28, 2017)

Strategic Alliance

-Delphi and Autonavi Software Co., Ltd. signed an exclusive alliance agreement on the development of applied technologies in the areas of infotainment systems and autonomous driving for the Chinese market. The deal covers the areas of big data, navigation systems, mobility services, and autonomous driving. In the areas of big data, navigation systems and mobility services, Delphi intends to use map developed by Autonavi Software to create new infotainment systems and IT-related services for the Chinese market. According to the agreement, Delphi is going to supply customers in China with autonomous driving services based on cloud end concept by combining Autonavi Software's autonomous driving map data, related software, and cloud calculation technologies. For the future autonomous driving products of the two companies, Autonavi Software is going to offer high-accuracy position recognition technologies. It also confirmed a plan to supply HD maps based on the position recognition technologies to Delphi for its other autonomous driving products. (From some releases on October 27, 2017)

-On October 12, 2017, Qingling Motors signed an agreement with Delphi for the joint development of 4KH1 National-VI engine, the Delphi will provide fuel injection system and SCR system solution for the engine. The 4KH1 engine is a kind of 4-cylinder diesel engine with 3.0L displacement, in the future, it will mainly be used in the pickup and light truck,and the fuel injection system and SCR system of Delphi will help it meet the National-VI Standards. The Delphi’s High-pressure Common Rail Fuel Injection System is a kind of diesel common rail technology, its fuel injection control capability can make the fuel combustion more complete so as to reduce the fuel consumption and effectively reduce the emissions of CO2, PM and NOx. (From a press release on October 12, 2017)

R&D Facility

<R&D Centers>

Name Operating Segment Location Year Established Overview

Aptiv (China)
Technical Center

Delphi (China) Technical Center

Delphi Electronic ans Safety Free Trade Zone, Pudong, Shanghai Dec. 2003 -The first global technical center of Delphi in China.
Delphi Electronics (Suzhou) Technical Center Delphi Electronic ans Safety Suzhou Industrial Zone May 2014 -The secoond R&D Center in China of Delphi Electronic ans Safety.
-Designing and developing auto infotainment systems, electronic control and vehicle safety relevant products and technologies.
-The facility that covers 1,500 square meters can be extended up to 3,000 square meters in the future. Buildings for designing and testing were expected to cover 1,000 square meters.
Delphi Diesel System (Yantai) Co., Ltd. R&D Center Power system Yantai,
Shandong
April 2017 -The biggest power system R&D center.
-As of May 2018, there are nearly 500 R&D staff.

-Dongfeng Automobile Co., Ltd. and Delphi jointly developed new China 6 standard DDi23 engine for light-duty trucks. Just recently, the two companies successfully ignited the engine. The all new engine is developed by Dongfeng Automobile based on Renault’s engine technology as a 2.3-liter 4-cylinder diesel engine for light-duty trucks. It will be used mainly for sports utility vehicles (SUVs) that fall on the N1 category (GVW≤3.5t) and trucks that fall on N2 category (3.5t<GVW≤12t). Delphi has offered high-pressure common rail diesel injection systems and postprocessing solution to help this engine meet the China 6 emission standard. (From some releases on August 23, 2017)

-Delphi announced that it will expand its Delphi Electronics (Suzhou) Technical Center located in the Suzhou Industrial Park. A cornerstone laying ceremony was held for a new building on March 1, 2017. When the expansion is completed, the facility will have a land area of 8,000 square meters and will be able to accommodate a total of 800 engineers. The center will mainly develop infotainment systems, human-machine interface technologies, active safety systems, and body electronics systems. The technical center was established in 2014. It currently employs approximately 300 engineers and plans to hire 500 more in the future. (From news releases issued by multiple sources on March 1, 2017)