ContiTech expands drive belt sector in ChinaBy Mike McNulty
HANOVER, Germany—ContiTech A.G. has purchased the power transmission belt business of Taizhou Fuju Rubber Belt Manufacture Co. Ltd. to expand its presence in China, primarily in the drive belt sector.
Located in a large facility in Sanmen, China, the acquired operation produces drive belts for the automotive replacement and general industry segments.
ContiTech intends to manufacture V-belts and V-ribbed belts at the plant beginning in spring, according to a company spokesman.
He said timing and multi V-molded belts will be manufactured for the automotive market and general industry at ContiTech's nearby factory in Ninghai.
Taizhou Fuju completed construction on its 355,200-sq.-ft. factory at the beginning of 2014, and it will lease the building for a long term to ContiTech, the spokesman said.
Initially, Taizhou Fuju planned to expand the business, he said, but then decided to sell the operation to ContiTech.
It also had ordered new machinery for the factory not long before ContiTech acquired the power transmission belt unit.
That equipment has been installed, and "other machinery will be bought directly by ContiTech," the spokesman said.
The Chinese company was formed in 1993 in Sanmen—located in Zhejiang province, south of Shanghai—and from its inception has manufactured drive belts predominantly for the automotive replacement sector and for industry in general.
About 100 employees make up the work force at the acquired factory, and all are expected to remain with ContiTech, the firm said.
"This acquisition enables us to achieve further above-average growth in China," according to Heinz-Gerhard Wente, who heads up the ContiTech division and is a member of the executive board at Continental A.G., the parent of ContiTech.
"In a very short time frame, we are expanding our production capacities in China and strengthening our drive belt business unit," he said.
Everything produced at the new facility "will likewise be manufactured in strict accordance with ContiTech quality standards," said Konrad Muller, who heads the ContiTech Power Transmission Group.
He said in the future the additional facility will enable the Hanover-headquartered company to ensure faster delivery of a wider variety of products to its growing customer base in the country.
China is a very important market for ContiTech, according to the spokesman. "Last year we opened an R&D center in Changehu ... to develop innovative products for vehicle mounting and vibration control technology—in close collaboration with customers such as Geely (Holding Group Co. Ltd.), Great Wall Motor Co., General Motors, Shanghai Volkswagen and Qoros (Automotive Co. Ltd.)."
Thus far, the company has invested about $10.8 million in the center, which is expected to employ 30 engineers by the end of 2014.
"We also opened a plant for TPO foils in Zhangjiagang," the spokesman said. "With its locally produced TPO products, Benecke-Changshun Auto Trim offers Chinese vehicle manufacturers what they have been looking for: cost-efficient and first class local TPO production."
ContiTech plans to continue expanding in China in the future, the spokesman said, "not only in the automotive industry, but also in the machinery and plant engineering industries."
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