From Detroit Free Press
DEARBORN, MI — Visteon Corp. said Tuesday it is expanding in China with two new plants that will support the explosive automotive market in Asia and position the Dearborn, Mich.-based company as a leading supplier of climate controls in the region.
During a conference call, Visteon announced it plans to build an $80-million plant in Dalian, China, which will produce air-conditioning compressors and subcomponents. That project in northeastern China will be a joint venture with Halla Climate Control Dalian Co. Ltd., and the 82,000-square-foot plant will employ about 600 workers once it is fully operational by mid-2005.
Meanwhile, construction was recently completed on a $29.8-million plant in Beijing, where about 200 workers build air-conditioning and engine cooling modules for Beijing Hyundai Motor Co. Visteon owns 80 percent of the 180,000-square-foot facility, with Beijing Automotive Industry Holding Corp. owning the remainder.
The new plants put Visteon on “a solid platform for future growth and ongoing viability,” said Bob Pallash, vice president of Asia-Pacific operations for Visteon.
Visteon posted revenue of $1.45 billion in its Asia-Pacific operations last year, compared to $1.25 billion in 2002 — a 16-percent increase. Pallash said revenue growth in the first half of this year has been stronger than it was last year.
Visteon would not say how many compressors or cooling modules will be made at the new facilities.
But it has no immediate plans to export the parts made at the Chinese plants outside of the Asia-Pacific region, said Visteon spokesman Greg Gardner. However, the company might consider exporting compressors at some point. “Right now, we’re just trying to keep up with demand,” Gardner said.
Visteon had been supplying parts to Hyundai through a temporary plant since late 2002, and the Korean automaker is planning rapid growth at its Beijing plant, where it makes the Sonata midsize sedan.
Hyundai produced 55,113 Sonatas in 2003, up from 1,046 in 2002, according to Automotive News. With the addition of the compact Elantra sedan, Hyundai production is expected to double this year to 110,000 vehicles.
Overall sales of passenger vehicles in China reached 2 million in 2003 and are expected to double by 2007, Automotive News said.
Visteon’s Asia-Pacific operations have been growing over the past decade and now include more than 35 manufacturing, technical, sales and service operations in China, India, Thailand, Taiwan, South Korea, Japan, the Philippines and Australia. Visteon has about 7,000 employees in the region and 18 joint ventures.
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