Business Overview

-ZF tapped the Chinese market in conjunction with VW's move into the industry. ZF has expanded its operations in China since 1994. By collaborating with major Chinese commercial vehicle manufacturers, the Company looks to further expand the Group's presence in the China.

Joint Venture

-ZF Shanghai Steering Systems (Wuhan) Co., Ltd. is constructing a plant adjacent to General Motors’ vehicle assembly facility at the Jingang New District, Jiangxia Economic & Technological Development Zone, Wuhan. The ZF subsidiary was established in November 2013 with a capital of CNY 50 million. It is investing CNY 350 million in the first phase of the construction project, which includes production lines for components such as electric steering columns, hydraulic steering systems, mechanical steering columns, and mechanical steering systems. (From news releases issued by multiple sources on January 13, 2014)

-On January 29, 2013, the Chongqing Foreign Trade and Economic Relations Commission said that the ZF Group of Germany and Baotou Beiben Heavy-Duty Truck are going to establish a joint-venture company in the Yubei District, Chongqing. The new entity will be capitalized at 122 million yuan. It will develop, produce, test and sell transmissions for commercial vehicles and also provide after-sales services. (From news releases issued by multiple sources on January 29, 2013)

Contracts

-At the 2013 Shanghai Motor Show, ZF China won a contract from China National Heavy Duty truck to supply its Ecosplit manual transmissions.  (From news releases issued by multiple sources on May 2, 2013)

-ZF Friedrichshafen AG signed an agreement covering the delivery of ZF-Ecosplit manual commercial vehicle transmissions to the manufacturer Sinotruck. ZF already supplies 16-speed Ecosplit transmissions from the Hangzhou location for current tractor trucks of the model range Sitrak C7H 6x4. The new ZF plant in Beijing will start production of passenger car axle systems in 2013. After production ramp-up, ZF is planning annual production of several thousand axle sets with 350 employees. The main customer is Beijing Benz Automotive Co., Ltd. (BBAC). In addition, ZF Beiben Drivetech (Chongqing) Co. Ltd., a joint venture between ZF and the commercial vehicle manufacturer Beiben, starts production of commercial vehicle transmissions in 2013. The joint venture, with ZF holding 51 percent, will produce 9-speed manual transmissions for medium-duty trucks as well as 5- or 6-speed manual transmissions for buses in addition to the 16-speed manual transmissions for heavy trucks. (From a press release on April 20, 2013)

-ZF announced on January 18, 2012 it has been awarded a new contract to supply axles for 2,200 low-floor buses of Beijing’s Public Transport Corporation (BPTC). Based on the agreement, more than 5,000 axles will be supplied by ZF Lenksysteme, a 50-50 joint venture between ZF and Bosch, starting in 2013. The axle products will include the RL85EC front axles, the AV132 drive axles, and the AVN132 tag axles, which can be used on non-step buses whose floor is only 350mm from ground level. ZF Lenksysteme will also manufacture the ZF-Servocom ball-nut type steering systems for BPTC buses. In addition to being chosen for BPTC’s low-floor buses, ZF’s axles have also been selected for use in BPTC’s 800 city buses. Of all 28,000 BPTC buses operating in Beijing, 15,000 buses are equipped with ZF’s axles systems and 800 employ ZF’s automatic transmission systems. ZF Lenksysteme’s ZF-Servocom steering systems are used on 18,000 BPTC buses. (From news releases issued by multiple sources on January 28, 2013)

Come into Production

-In November 2013, the Yantai Plant of ZF Shanghai Steering Co., Ltd. launched a project to localize the production of the fourth-generation ball-slider type intermediate shaft for column-type electric power steering systems. The new product is developed by ZF's subsidiary in France, and will be manufactured at the Yantai facility. (From a press release on December 10, 2013)

-In 2013, the Company will start operations at its new plant in Beijing to produce axle systems for passenger vehicles. The facility, which will hire 350 employees, will have the capacity to produce thousands of axles a year for Beijing Benz and other automakers. Sales at ZF China currently account for approximately 12 percent of the worldwide ZF sales. (From news releases issued by multiple sources on May 2, 2013)

Off the Production Line

-ZF Shanghai Steering Co., Ltd. produced its first dual-pinion type electric power steering system in October 2013. The Group launched a project to localize production of these EPS in China in January 2012. The Chinese subsidiary introduced 20 manufacturing machines and 21 pieces of measuring equipment from 13 German industrial machinery suppliers for the new production lines. (From news releases issued by multiple sources on October 27, 2013)

-In September 2013, ZF Shanghai Steering Co., Ltd. completed the third phase of the construction project for its new electronic power steering (EPS) production lines. Manufacturing of dual-pinion type EPS system already started on the new production line. Approximately CNY 1.2 billion was invested in the third phase. The construction project was launched in November 2012. Full-scale operations are expected to begin in 2014 after the entire construction plans are completed. The company is hoping to produce CNY 4 billion worth of these EPS systems per year, and is expecting to become one of the world’s largest EPS manufacturers. (From news releases issued by multiple sources on October 27, 2013)

-ZF Liuzhou Drive Axle Co., Ltd. has started producing the samples of its AP3000 axles. ZF Liuzhou Drive Axle was established jointly by ZF China and Guangxi Liugong Machinery Co., Ltd. in September 2012. The AP3000 axels will be used mainly on 5- and 6-ton wheel loaders built by Guangxi Liugong Machinery. (From news releases issued by multiple sources on July 2, 2013)

R&D Facility

-The Group has 4,000 square meters R&D center in Shanghai for developing, designing and material test. The center has about 300 employees.

-ZF Shanghai Steering Co., Ltd. announced that its R&D center has obtained the ISO17025 certification from the China National Accreditation Service for Conformity Assessment. The company became the first Chinese steering supplier and the first ZF group company to acquire the certification. (From news releases issued by multiple sources on December 30, 2013)

Investment in China

-ZF Friedrichshafen AG announced that it invested more than EUR 1 billion in its Asia-Pacific business in 2013. With the new production location for passenger car axle systems in Beijing and the expansion of passenger car axle assembly in Shenyang, Liaoning Province, it has also increased its presence in China. (From a press release on December 13, 2013)

-In November 2013, ZF Shanghai Steering Co., Ltd. held a ground-breaking ceremony for its new industrial park in Yantai. The industrial park will house the facilities of ZF Shanghai Steering’s major suppliers. (From a press release on November 5, 2013)

-In September 2013, ZF Transmission Shanghai Co., Ltd. held an opening ceremony for its new plant built on 60,000 square meters of land. Since the ZF subsidiary was established on June 9, 2004, it has produced and sold more than 510,000 automatic transmissions by the end of August 2013. The company is planning to manufacture and sell 400,000 automatic transmissions over the next three years. The new factory was completed in the first phase of the company’s expansion project. (From news releases issued by multiple sources on October 14, 2013)

-In September 2013, ZF held a ground-breaking ceremony for the group’s first plant in Beijing. The total investment in the new plant will amount to EUR 15 million. The plant is a wholly-owned subsidiary of the group. It will cover 32,000 square meters of land. The plant will produce automotive axle systems for Beijing Benz Automotive. (From a press release on October 6, 2013)

-In June 2013, ZF announced that it will establish a new facility in Shanghai to produce rebuilt transmissions, since it gained approval from the National Development and Reform Commission to start a model business for transmission recycling. By 2016, the plant on 2,500 square meters of land will be able to produce yearly 4,600 units of 8- and 9-speed transmissions for passenger vehicles, becoming the first of its kind in China. (From news releases issued by multiple sources on June 24, 2013)