Shanghai Automotive Industry Corporation (Group) Business Report FY2007

Business Highlights

<Joint-business ventures with non-Chinese companies>

Joint-venture operations with TRW
- In January, 2007, TRW announced that the Group is supplying its active and passive safety systems to the new Roewe 750 built by SAIC Motor. Specifically, TRW Automotive Components (Shanghai) Co., Ltd. (TACS) is manufacturing high-performance electronic stability control systems (ESCs) and Shanghai TRW Automotive Safety Systems Co., Ltd. (STASS) is producing front seat belt adjusters and rear seat belt systems.

Joint-venture company with ZF
- In December 2007, ZF Shanghai Steering Co., Ltd. manufactured its 1 millionth steering. Having launched the electric power steering (EPS) project in 2008, the subsidiary, which has been focusing on the production of hydraulic power steering systems, will be shifting to making electric power steering in steps.

Joint ventures with Visteon
In October 2007, Yanfeng Visteon Jinqiao Automotive Trim Systems Co., Ltd. (Yanfeng Visteon), which is a subsidiary of Yanfeng Visteon Automotive Trim Systems Co., Ltd., held a gala groundbreaking ceremony at the plant site for its new Shenyang Branch. The new Shenyang facility will enable the company to reduce delivery lead-time in supporting both Shanghai GM (Shenyang) Norsom Motors and Shenyang Brilliance Jinbei Automobile and cultivate new customers in the northeast region of China.

- In October 2007, Yanfeng Visteon held a signing ceremony with Anhui Jianghuai Automotive Group Co., Ltd. (JAC) to establish a joint venture company, Yanfeng Visteon (Hefei) Automotive Trim Systems Co., Ltd. The new Hefei facility will supply seat systems, instrument panels, door trims, pillars, and carpets mainly to JAC. Yanfeng Visteon will provide 80 percent and JAC will invest 20 percent of the needed capital.

Joint venture with GKN
- In September, 2007, GKN Driveline based in the U.K. won a supply award from Chery Automobile to provide power transfer units to the new sport utility vehicles Chery will release in 2009. GKN Driveline will procure necessary components locally and manufacture the power transfer units at Shanghai GKN Drive Shaft Co., Ltd. in Kangqiao, Shanghai.

Joint venture with Plastic Omnium
- In April, 2007, Yanfeng Visteon Automotive Trim Systems Co., Ltd. and Plastic Omnium jointly established Yanfeng Plastic Omnium Automotive Exterior Systems co., Ltd. (YFPO). Yanfeng Visteon Automotive Trim Systems Co., Ltd. is a 50-50 joint venture between the Company and Visteon. The joint-venture company integrated Yangfeng Visteon's exterior parts business. From its production facilities in Shanghai (Anting), Chingqing, and Nanjing, YFPO supplies bumpers and other exterior components to Shanghai GM, Shanghai VW, SAIC Motor, Beijing Benz, and Changan Ford Mazda. FYPO plans to establish additional plants in Pudong, Shanghai and Shenyang. 

<Highlights at other subsidiaries and affiliates> 

Shanghai Cosmopolitan Automotive Accessory Co., Ltd.
In January, 2007, Shanghai Cosmopolitan Automobile Accessory Co., Ltd. completed construction of its new plant in Anting Automobile City and moved there from the central area of Shanghai. It has since started operations and began production at the new plant.

Shanghai SIIC Transportation Electric Co., Ltd.
- In December 2007, Shanghai SIIC Transportation Electric Co., Ltd. received an award from GM of the USA to supply five types of horns. Based on the award, the company will provide 6 million horns over a period of five years to GM's plants in China, Korea, Canada, the U.S., Australia, and Brazil. 

Business Collaboration with Baosteel Group Co.
- In November 2007, the Company and Baosteel Group Co. signed an agreement to establish Shanghai Baosteel Wheels Co., Ltd. in Baoshan, Shanghai. The new joint-venture company will manufacture 6 million high-strength, yet light-weight, steel wheels per year.