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Federal-Mogul Announces Distribution Partnerships In China, Thailand

Federal-Mogul Motorparts and China Automotive Import and Export Co. Ltd. (CAIEC), a nationwide state-owned 4S automotive distribution network, have announced the formation of a joint venture called Federal-Mogul CAIEC Automotive Technology Services (Beijing) Co. Ltd.

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Federal-Mogul Motorparts - LogoFederal-Mogul Motorparts, a division of Federal-Mogul Holdings Corp., has announced two new business ventures in China and Thailand.

Federal-Mogul Motorparts and China Automotive Import and Export Co. Ltd. (CAIEC), a nationwide state-owned 4S automotive distribution network, have announced the formation of a joint venture called Federal-Mogul CAIEC Automotive Technology Services (Beijing) Co. Ltd., which will be focused on automotive aftermarket vehicle repair business within China. Federal-Mogul Motorparts will be the preferred supplier to the joint venture, providing its broad portfolio of premium-branded automotive parts for distribution through a network of company-owned stores and outlets to be established by the joint venture under the brand name Motorcare. Additional terms of the transaction were not disclosed.

Commenting on the joint venture, Dan Ninivaggi, CEO of Federal-Mogul Motorparts, said, “In a strategic expansion of our automotive aftermarket business in Asia Pacific, Federal-Mogul Motorparts is pleased to partner with CAIEC to build broader business channels and a platform for growth in China, ensuring quality vehicle repair and technical experience from our more than 100-year history to independent service shops through the opening of an extensive network of Motorcare stores serving the independent aftermarket. We believe this market will be highly receptive to the safety, quality and reliability provided by Federal-Mogul Motorparts’ premium-branded automotive parts.”

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Jianhong Yin, vice president of SINOMACH, president and general manager of CAIEC, commented, “We look forward to partnering with Federal-Mogul Motorparts, a global manufacturer and distributor of world-recognized automotive parts, to build on CAIEC’s established presence in China through Motorcare. This joint venture combines the strong brands, resources and strategic channels of both companies and significantly strengthens our ability to meet the automotive parts needs of the China market where the number and age of vehicles on the road is increasing and the number of vehicles and models continues to proliferate.”

“We look forward to a long and successful partnership with CAIEC as we grow the spirit of cooperation among our companies and firmly establish the Motorcare business throughout the strategically important China market,” added Keith Power, president, Asia Pacific, Federal-Mogul Motorparts.

In addition, Federal-Mogul Motorparts has entered into a joint venture agreement with Loxley Public Co. Ltd., under which Federal-Mogul Motorparts will own a majority stake in and have operational control of Parts Zone (Thailand) Co. Ltd., an established automotive parts distributor in Thailand. Additional terms were not disclosed.

The joint venture will be based in Bangkok. Parts Zone currently has four distribution outlets in Thailand (two in Bangkok; one in Chiang Mai in northern Thailand; and one in Surat Thani in southern Thailand). As part of the joint venture, this number of locations is expected to expand by up to a dozen additional distribution points.

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“In a strategic expansion of our distribution footprint in Asia Pacific, Parts Zone will serve as a key platform for Motorparts’ premium-branded products in Thailand and the greater Asian region,” said Ninivaggi. “We see our expanded presence there as pivotal to our continued growth in the region, especially given the anticipated creation of the ASEAN Economic Community (AEC) by the end of 2015.”

“Federal-Mogul Motorparts is delighted to partner with Loxley, a pre-eminent Thai public company with significant experience in the Southeast Asian market. We look forward to a long and successful partnership in growing the Parts Zone business,” added Power.

Suraphand Bhasitnirandr, senior executive vice president of Loxley Public Co., commented, “We look forward to partnering with Federal-Mogul Motorparts, a global manufacturer and distributor of premium-branded automotive parts, to build on Parts Zone’s established presence in Thailand. This joint venture strengthens our ability to meet the automotive parts needs of the Thai market which currently has vehicles in operation of 13.2 million.”

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