SKF on a Roll in China’s Car Sector

SKF Group AB, the world’s top bearing maker by revenue, will put more resources into China’s automotive market in the next few years to demonstrate its commitment to the world’s fastest-growing economy.


The company plans to expand its global technical center in China and increase production capacity by strengthening existing factories and building new ones, said Tryggve Sthen, president of SKF’s automotive division.


Headquartered in Gothenburg, Sweden, the bearing-to-lubrication conglomerate posted net sales of 61 billion kroner ($9 billion) in 2010. Net sales of SKF’s automotive division hit 18.2 billion kroner in 2010, up 13.6 percent year-on-year.


“China is, and has always been, an important market for us. We see good momentum in the country, and we are glad the investments we made here have developed well,” Sthen said.


These investments include a plant under construction in Jinan, the capital of eastern China’s Shandong province, which was launched in March. With an initial capital of 590 million kroner and an initial space of 16,000 square meters (sq m), the factory is set to open early next year with some 500 employees.


The Jinan operation will mainly make tapered roller bearings and truck hub units to serve automotive and truck makers. According to Sthen, the factory uses new technology that is designed to make Chinese trucks more competitive and reliable.


“The product is tailored to the truck industry and will serve both local clients and those in Asia, and it will help upgrade the industry standard,” Sthen said.


In a separate factory in Wuhu in eastern China’s Anhui province, SKF is adding capacity to mass-produce a new product line of bonded piston seals, designed for a new generation of automatic transmissions. These parts will result in reduced friction and improved fuel efficiency.


China aims to develop the energy-saving vehicle industry over the next 10 years, with government funding of 100 billion yuan ($15.65 billion). The Ministry of Industry and Information Technology said in a report that 4.19 million energy-saving cars had been manufactured as of the end of June.


SKF plans to achieve more technological breakthroughs. The company will revamp and expand its global technical center based in suburban Shanghai.


By 2015, the new operation will cover 3,500 to 5,000 sq m of space, at least five times the current area. The company aims to attract 400 skilled workers for the center, compared with about 20 people in 2010.


SKF has received orders to supply bearings and seals to a “start-stop” solution used by a major car producer in China, which can achieve up to 25 percent fuel consumption savings in city traffic.


But the company has further ambitions. It is working closely with local authorities in Shanghai’s Jiading district to contribute its technology to an electric car demonstration zone.


“China is at the forefront in clean-energy development. We see clear ambitions and significant support from the government. We hope to be part of the process and ride the ‘green’ boom,” Sthen said.

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