CHANGZHOU, China — Magna Powertrain, a group of Magna International Inc., has announced that Magna Powertrain (Changzhou) Co. Ltd. has been established and put into production in the Changzhou National Hi-Tech District in Jiangsu, where the company has founded the first engineering (R&D) center in this district of China beside the already-existing manufacturing facility.
Guenther Apfalter, president of Magna Powertrain Europe and Asia, said that the investment in Magna Powertrain (Changzhou) Co. Ltd. totaled $50 million.
Magna Powertrain (Changzhou) Co. Ltd. is producing and will assemble transmission oil pumps, mass balancer systems and power take off units including a small die casting operation with subsequent machining processes to ensure an optimized vertical integration.
"We had considered locating our engineering R&D center in Shanghai, but the industrial support and excellent investment environment here persuaded us to land our R&D center in the Changzhou Hi-Tech District,” said Xiuzhan Zhu, headquarter controller Europe/Asia of Magna Powertrain.
The major customers of Magna Powertrain (Changzhou) Co. Ltd. are Shanghai-GM and Ford in America. The export for the orders from American Ford accounts for one-third of its total orders.
"Our sales in Asia only account for 3 percent of our total sales and, at the same time, our sales in the North American market and Europe account for 71 percent and 26 percent respectively. Judging from the development trend and forecast from the China State Information Center, China will surpass the U.S.A. and become the largest auto consumption market in the world until 2015. Therefore it is of strategic importance to establish both a factory and an R&D center in China. We hope our market share in Asia will be increased by 10 percent in the next couple of years," said Zhu.
Approximately 19 of the world’s top 500 companies currently reside in the Changzhou Hi-Tech District, but Magna Powertrain (Changzhou) Co. Ltd. is the first wholly foreign-owned company that has established an R&D center in Changzhou.
The Magna Powertrain Engineering (R&D) Center has had a RMB15 million investment from a couple of months ago up until now, including as much as RMB4 million spent on laboratory testing equipment and with just more than 20 R&D staff. This center has independently developed a testing equipment-lubricating and accelerating test bench with a maximum performance of 9,000 revolutions per minute. Its performance is comparable to that of big international companies, while its price is only one-tenth of theirs. The test bench can incline to a 45-degree angle in all directions at maximum to simulate the performance of various types of vehicles as they travel uphill and downhill, accelerate, decelerate, and turn and tilt about on actual roads. And it’s also equipped with many precision test sensors for speed, torque, acceleration, temperature, angle, etc.
The Engineering R&D Center in Changzhou is developing the power takeoff and balancing shaft and other powertrain parts for local Chinese OEMs. It shares the same powertrain development platform with the engineering centers in Europe and North America. The Changzhou Engineering R&D Center will strive to be a supporter of vehicle powertrain engineering in the Asia-Pacific region and strengthen strong design, analysis, program management and testing capabilities for key parts of engine, axle, AWD/4×4 and transmission.
Magna Powertrain plans to put its second testing laboratory into formal use in January 2008, which consists of the MTS static test bench, oil pump test bench, gear boxes test bench, SAE friction test bench, etc. This laboratory will also be opened to external users and serve foreign and Chinese enterprises.
