ZG Boge Elastmetall sets up Chinese JV

By Liz White, ERJ staff

Friedrichshafen, Germany-ZF Boge Elastmetall, the rubber-metal technology division of ZF Friedrichshafen AG, signed a joint-venture agreement with local partners in Shanghai, China earlier this year.

“The new company will develop and produce rubber-metal components to reduce noise and vibration in the chassis and drivelines of road and rail vehicles,” said ZF's statement on the deal. "The joint venture combines all activities of both partners in China in the area of rubber-metal products,” said ZF Boge Elastmetall managing director Bernd Schmeling, who added that the focus over the coming years will be on the Chinese market.

ZF Boge Elastmetall owns 51 percent of the new company, ZF Zhongding NVH Co. Ltd, whilst partner Anhui Ningguo Zhongding (Group) Co. Ltd owns 44 percent. The remaining shares belong to the Shanghai Huizhong Economic Development Co. Ltd.

The company will start operating in the first half of 2005, with a workforce of 500, at its plant in Ningguo, Anhui Province, and production, engineering and sales activities in Shanghai. During fiscal 2005 ZF Zhongding NVH should achieve sales of over Euro 20 million with an investment of Euro 4.2 million, said the group.

This initial turnover figure is possible because the two partners will put all their current market contacts and production volume into the JV, ZF explained. Anhui Ninguo Zhongding has agreements with Shanghai Volkswagen and Shanghai GM, while ZF Boge Elastmetall is the supplier for the VW platform PQ 35 and for carmaker Jinbei.

ZF Boge Elastmetall is a developer and manufacturer of vibration damping and mounting systems for car, commercial vehicle and rail vehicle chassis and drivelines.

ZF Friedrichshafen said in its annual results statement that 2004 sales for the rubber-metal business were up by 3 percent to Euro 526 million. This increase was “backed by chassis and engine suspension products designed to comply with new legislation aimed at protecting pedestrians,” said the German-headquartered group.

The rubber-to metal group is a small part of the total ZF business, which reported an 11 percent overall increase in sales, to Euro 9899 million in 2004. “This substantial growth of Euro 971 million is primarily a result of the economic trend in commercial vehicles and construction machinery as well as the market success of new products,” said the group.

"2004 was a successful year for ZF. We are still on the right track with our strategy of maintaining technological leadership and taking advantage of globalisation opportunities," commented ZF ceo Dr Siegfried Goll at the group's April results meeting.

Most ZF divisions achieved double digit sales increases and, together with improved operating figures, this contributed to profits of Euro 180.7 million, against a loss the previous year of Euro 162.3 million, Zoll said.

Zoll said the ZF Group continued to expand internationally in 2004: as well as the Rubber-Metal Technology venture in China it set up another Chinese JV for manufacturing automatic car transmissions.