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Another US auto brand heads for China

2014-05-20 10:30

JOINT VENTURE: US auto supplier Johnson Controls has merged with SAIC motors in China in a new deal. Image: Supplied.

NEW YORK - US auto parts supplier Johnson Controls will outsource its manufacturing of car-interior parts in a merger with a subsidiary of Chinese automaker SAIC.

Johnson Controls said on Sunday (May 18) it would have a 30% stake in the shared enterprise which, it claimed, would be "the largest automotive interiors company in the world with revenues equivalent of R80.8-billion."

The remaining 70% ownership would be held by a subsidiary of SAIC, Yanfeng Automotive Trim Systems.


The new company will be based in Shanghai but have development centres and clients in the US, Europe and Asia. It will produce instrument panels and cockpit systems, door panels and floor consoles.

Johnson Controls had for several months been examining options for its car-interior parts production which are worth around $4.2-billion a year, a spokesman said. Chairman and chief executive Alex Molinaroli said in the statement the new venture was "a natural extension of our already very successful existing partnership with Yanfeng in automotive seating".

"It creates a strong combined company with a market-leading position and a foundation for sustained global growth."

The deal is expected to be completed during the first half of 2015.

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