Published

Partners Form Electric Power Steering JV in China

China Automotive Systems Inc. (CAS) and Japan KYB Co. have created a joint venture to market electric power steering (EPS) systems in China.

Share

China Automotive Systems Inc. (CAS) and a Chinese subsidiary of Japan KYB Co. have created a joint venture to market electric power steering (EPS) systems in China.

The partners plan to invest a combined 960 million yuan ($151 million) into the new company, which will be called Hubei Henglong KYB Automobile Electric Steering System Co. CAS will hold a two-thirds stake in the venture.

CAS and KYB will transfer all their current EPS business in China to Hubei KYB. The Hubei Province-based joint venture will develop, produce and sell column-, gear- and rack-type electric power steering systems and related components.

Hubei KYB will be capitalized at 320 million yuan ($50 million). The company will have capacity to produce five million EPS systems per year at a Jingzhou City manufacturing plant to be leased from CAS. A research and development facility in Wuhan also is planned.

In addition to supplying CAS and KYB’s customers in China, the joint venture aims to export systems to other markets. The company won’t compete with KYB in Japan.

Gardner Business Media - Strategic Business Solutions