If you want to be successful in the world’s largest automotive market, you need to be present on-site. ZF is expanding its presence in China with new production and development capabilities to offer Chinese customers tailored high-tech solutions.
April 12, 2019
Kathrin Wildemann has been a part of the permanent Copy Team at ZF since 2016. In her online and offline articles, she likes to cover electromobility and other topics that involve sustainability.
In the automotive industry, China has been a market of superlative growth for many years now. In 2018, approximately 23.3 million vehicles, nearly a third of new vehicles worldwide, were newly certified in China. Although growth has recently begun to slow down a bit, there is no question that established international automotive manufacturers cannot overlook the East Asian country if they plan to remain successful over the long term. At the same time, Chinese OEMs have long shed their image as cheap manufacturers and have moved to the fore when it comes to future trends such as electromobility and autonomous driving.
Well Positioned in China
ZF is already well acquainted with the Chinese market. The technology company opened its first plant in Langfang in 1994. Currently, there are 32 production sites, which employ around 15,000 employees – and counting. ZF is considerably expanding its presence in China. “Our Group strategy, known as ‘Next Generation Mobility,’ is clearly focused on rapidly growing markets, and particularly China”, says Dr. Holger Klein, Member of the Board of Management of ZF. Dr. Klein has led the Asia-Pacific market region at the Group’s Chinese headquarters in Shanghai since the fall of 2018. “Almost all of our customers will expand their business into China over the coming years. We will support them in this with our ‘Local for local’ strategy by offering our entire portfolio of skills right there, locally, from development services to local Just-in-Sequence delivery.”
Accordingly, ZF will significantly increase its development capabilities and hire additional 1,000 engineers in China. At the same time, the Group will have built three new production facilities by the end of 2020, including two plants for electric power steering and chassis components for passenger cars in Zhangjiagang as well as a hub for different types of electric drive solutions in Hangzhou. Electromobility plays a particularly important role in China due to stringent legal provisions and subsidies. Over half of all electric vehicles that were newly registered worldwide in the last year are being driven on the streets of China.
The ZF transmission plant in Shanghai has been producing automatic transmissions since 2004.
High-Tech Solutions from China for China
The start of series production of the 8HP 8-speed automatic transmission in ZF’s transmission plant in Shanghai serves as another important example of the Group’s comprehensive localization strategy. Since 2004, 5-speed, followed later by 6-speed, automatic transmissions have been manufactured at the plant. In addition, further development of the Group’s flagship product, which will go into production in the spring of 2022 in Saarbrücken, is slated for localization in Shanghai. The fact that ZF enjoys success with its transmissions in the age of electromobility when also offered in hybrid models is evident from a recently notched-up large order from BMW.
ZF already manufactures prototypes of the 8-speed automatic transmission 8HP at its Shanghai plant. Volume production is set to begin in Q3 2019.
The technology company cooperates with the China Automotive Technology and Research Center (CATARC) and works closely with Chinese customers, both new mobility service providers as well as established OEMS, in order to develop solutions that meet the specific requirements of the Chinese market. For example, ZF is manufacturing the TraXon commercial vehicle transmission in a joint venture with Foton, a commercial vehicle manufacturer. Manufacturing will start in the next few days in the newly built plant in Jiaxing. “We plan to increase our localization efforts to 100 percent in the coming years by strengthening the presence of our innovations and high-tech products even more,” says Klein.
“We offer our entire portfolio of skills right there, locally, from development services to local Just-in-Sequence delivery.”
Dr. Holger Klein, Member of the Board of Management of ZF Friedrichshafen AG