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Bosch Expanding Further in China, Sees Diesel Sales Growing to 15% in 10 Years

22 November 2005

The Bosch Group plans further significant expansion of its presence in China to make it a core manufacturing center serving the Chinese domestic market as well as the larger Asia-Pacific market.

Franz Fehrenbach, the Chairman of the Board of Management, made the comments at a press conference on the occasion of the opening of a new development and manufacturing facility in Wuxi. By 2007, Bosch will have invested roughly €200 million (US$236 million) in the facility for the production and development of advanced diesel systems.

Between 2005 and 2007, Bosch plans to invest a total of some €650 million (US$768 million) in the China. Up to 2004, Bosch had invested roughly €550 million (US$650 million) in the establishment and expansion of its Chinese activities. In the past five years alone, the number of Bosch manufacturing facilities there has doubled, from 10 to 20.

This year, the sales of our Chinese companies are likely to exceed 1.2 billion euros [US$1.4 billion]. Year on year, on a comparable basis, this means a 20 percent increase.

In Asia-Pacific, we will generate sales of roughly six billion euros [US$7 billion] this year—exactly five times as much as ten years ago.

Asia-Pacific’s share of our worldwide sales is currently 14 percent. Ten years from now, we expect this share to be 25 percent.

—Franz Fehrenbach

Bosch will invest some €100 million (US$118 million) in the production of common-rail diesel systems in India by 2007. In South Korea, the company plans to spend roughly €100 million on new diesel technology products by 2010.

Like most industry experts, we expect to see China continuing to grow in the ranks of car-producing countries—probably occupying second place behind the U.S. just six years from now, which will put it ahead of Japan and Germany.

In Western Europe today, every second new car is a diesel. In China, this share is currently still very low. In the next ten years, however, it may increase to some 15 percent.

This is an opportunity both for environmental protection and for our new facility in Wuxi.

Apart from state-of-the-art diesel systems, Bosch expects to see considerable growth above all in its ESP electronic stability program in China due to increasing demand for systems enhancing road safety.

Bosch founded its first trading office in China as early as 1909. In 1926, the first car service workshop opened in Shanghai. Today, all of the Bosch business sectors are present in China. The company operates via a holding company in Shanghai, 13 subsidiaries, six joint ventures, and six trading companies.

November 22, 2005 in China, Diesel | Permalink | Comments (0) | TrackBack (0)

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