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ZF Friedrichshafen has officially introduced its branded gearboxes to the Chinese market after the German auto giant’s first product rolled off the production line at its facility with joint venture partner Beiqi Foton Motor.
The Friedrichshafen-based firm held a ceremony to mark the launch of its largest production facility globally, according to a statement on April 18. The base, located in Jiaxing, eastern Zhejiang province, can produce 550,000 gearboxes annually.
ZF Group unveiled its new-generation automatic transmission brand Traxon for commercial vehicles at the ceremony marking a major foray into the market for the firm.
Traxon products are mainly used in high-end vehicles and the import substitution rate in the country is not high due to import costs, stated an executive at the firm’s commercial vehicle technology unit, adding that more than half of parts will be provided by Chinese partners within two to three years bringing costs down.
ZF and Beijing-based Foton set up two joint ventures to build and run the base. One focuses on supplying gearboxes to heavy-duty commercial vehicles with ZF Group holding a 51 percent stake. The other JV targets the light commercial vehicle market with ZF Group controlling 40 percent.
Users of light commercial vehicle users are sensitive to the price of gearboxes while those of heavy-duty ones value technical specifications, Foton Deputy General Manager Wu Yuejun told Yicai Global. The different market demands led to the setup of two separate JVs, he added.
Source: yicaiglobal.com
