MILAN and HANGZHOU — Magneti Marelli and Wanxiang Qianchao Co., one of China’s leading manufacturers of automotive components, have signed an agreement to establish a joint venture in China for the production of automotive shock absorbers.
The joint venture, which provides for equal shareholdings, is expected to be operational by the end of 2011.
The JV’s industrial facilities will be located near Hangzhou, a city with population of 9 million and capital of the Zhejiang province, which is an important logistical-industrial hub situated 180 km southwest of Shanghai, where the Wanxiang group has developed a strong industrial presence.
At full speed, the JV will almost double production over the next three years, from the current 3 million shock absorbers produced by Wanxiang for domestic customers to more than 6 million covering also transnational carmakers operating in China.
The JV’s product strategy will be aimed at the design, production and marketing of “traditional” (or passive) shock absorbers enriched with new technical features – such as “powershock” full displacement valves, position and frequency-dependent damping characteristics, as well as “intelligent” shock absorbers using Magneti Marelli system innovations associated with electronic shock absorbers.
In this area, Magneti Marelli brings technologies such as the “Synaptic Damping Control,” which provides efficient active ride control system. Magneti Marelli says it also has perfected the technology for shock absorbers with dual mode operation called “Dual Stage Valve” (DSV), which allows for choosing between a high comfort driving mode and high accuracy driving mode. DSV technology offers a low-cost approach for ride control in small and medium-sized vehicles, as well as sports applications, according to the company.
“This agreement is doubly important in terms of strategy,” said Eugenio Razelli, CEO of Magneti Marelli, “as it represents the completion of our industrial presence in China, a strategic market in which we have been operating since 1996 and which now duplicates the entire perimeter of Magneti Marelli’s core activities. At the same time, it also represents a further strengthening of our global presence in the shock absorber sector, where Magneti Marelli has a very competitive position. China joins the acquisition of the U.S-based Pulaski plant and the JV with Endurance in India, in addition to the strong presence in South America and in Poland, with an industrial mission split between OE and aftermarket activities, with annual production of over 28 million shock absorbers.”
Magneti Marelli was recently presented with an award by the Italian Chamber of Commerce in China for being the “Italian company with the most effective approach to the Chinese market in 2010.” Last year, Magneti Marelli increased its turnover in China by more than 40 percent, exceeding the performance of the total automotive market, which posted strong growth of about 32 percent, according to the company.
Now in its 15th year of operations in China, Magneti Marelli’s footprint includes Shanghai (headquarters and powertrain, exhaust systems and lighting divisions, in addition to the JV with SAGW in Jiading for production of hydraulic components for the Freechoice robotized gearbox), Wuhu (lighting and powertrain) and Guangzhou (electronic systems).
