SHANGHAI (July 11) — Continental A.G.´s automotive systems division has selected a site in Shanghai for a $60 million engineering center/office that also will serve as the Asian headquarters of the company´s passenger/light truck tire and ContiTech divisions.
The Conti automotive division will build two facilities in Shanghai: an office site with design and test labs in the Yangpu District and one at the division´s existing facility in Jiading with large-scale equipment for bench testing.
"The establishment of a dedicated engineering center in Shanghai marks a strategic step towards our goal to be one of the leading automotive suppliers in China," said Karl-Thomas Neumann, president of Continental Automotive Systems.
"By 2010, we want to double our sales in Asia," said Jay Kunkel, president of the Asia Region and Conti Automotive Systems board member. "Continental Automotive Systems´ growth in China will contribute significantly to the realization of this goal."
Both facilities will be operating by early 2009 with about 450 employees at start-up; employment could rise to 600 by 2011, Conti said.
Conti only recently named Andreas Esser, head of Conti´s original equipment car tire business, to head its newly created replacement car and truck tire activities in Asia.
Last year, Conti recorded $346 million in tire-related sales in Asia, according to the firm´s 2006 annual report, or roughly 4.5 percent of the firm´s global tire sales. Conti has tire production at two plants in Malaysia and some off-take production agreements with firms in India and Vietnam.
The tire maker has been pursuing a tire production venture in China for several years — even signing a joint venture memorandum three years ago — but to date has not been able to secure a deal.