China Stocks: China Automotive Systems (CAAS) (2003)

China Automotive Systems Inc. (NASDAQ: CAAS) was founded in 2003 and is headquartered in Jingzhou City, Hubei Province, China. It has 5,319 full-time employees and is the leader of China’s automotive power steering systems and parts. Vendor.

China Automotive Systems Logo

China Automotive Systems (CAAS):

China Automotive Systems Corporation is a leading supplier in China’s automotive power steering system and components industry, operating through its 15 companies. The company has more than 20 years of experience in the field of automotive power steering system manufacturing.

The main business of China Automotive Systems is concentrated in China. The increase or decrease in China’s automobile production and sales will cause corresponding changes in the company’s operating performance. The company’s products include a full range of steering system components for passenger cars and commercial vehicles. At present, the company provides 4 series, more than 300 models of power steering system products, including rack and pinion power steering, integral power steering, electric and manual steering, steering column, steering oil pump and steering oil pipe.

According to the latest data from China Association of Automobile Manufacturers, China’s automobile production and sales in 2014 reached 23.7 million and 23.5 million, respectively, an increase of 7.3% and 6.9% respectively compared to 2013. Among them, the production and sales of passenger cars were 19.9 million and 19.7 million, respectively, an increase of 10.2% and 9.9% compared to 2013. In 2014, the production and sales of commercial vehicles were both 3.8 million units, down 5.7% and 6.5% respectively from 2013. In 2014, the company’s passenger car and commercial vehicle steering gear sales increased by 19.6% and 1.4% respectively over the same period of the previous year. With the recovery of China’s overall economy and the continuous growth of the income of Chinese urban and rural residents, the automotive industry experienced single-digit growth in 2014. Industry analysts expect the market growth rate to remain at 8% to 10% in 2015.

China Automotive Systems has strong technical force and R&D capabilities, and pursues a technology-leading strategy to maintain its competitive advantage in the industry. The company has a provincial-level technical inspection center and employs about 500 employees, including 49 senior engineers, 6 foreign experts and 247 engineers. The center is committed to the development and testing of steering systems, the improvement of production processes and the application of new materials and new production methods. The company believes that its engineering and technical expertise and its focus on continuous research and development enable the company to use the latest technology, materials and processes to solve problems for customers and bring innovative products to the market. At the same time, the company carried out active cost management in other business areas and increased the total expenditure of R&D activities including engineering technology. In 2014 and 2013, they invested approximately US$23 million and US$20.9 million respectively. The substantial increase in R&D expenses in 2014 was mainly used for the research and development of electric power steering systems. The company believes that the demand for new electric power steering system products will increase significantly. In 2013 and 2014, the sales of electric power steering products accounted for 9.3% and 12.1% of the company’s total sales respectively.

China Automotive Systems has 3 major trademarks and more than 190 Chinese national patents for power steering technology. The company is integrating cutting-edge technologies into its current production lines, such as electronic chips for electric power steering systems. The company has signed a 10-year patent license transfer agreement with BISHOP Steering Technology, a leader in providing advanced steering valve technology and automotive steering technology innovation; and a major manufacturer of steering column (necessary technology for electric power steering systems) South Korea Nanyang Co., Ltd. signed a technology transfer agreement. In addition, the company and Tsinghua University jointly established the Hang Lung Automotive Steering System Research Institute, aiming to develop electric power steering (EPS) and electro-hydraulic steering system (EHPS).

China Automotive Systems has established business partnerships with more than 60 automakers, including 2 of China’s five largest automakers, FAW Group and Dongfeng Motor Group, China’s largest light vehicle manufacturer-Shenyang Brilliance Jinbei Co., Ltd. The company, the largest state-owned automobile manufacturer-Chery Automobile Co., Ltd., and the largest private automobile manufacturers-BYD Automobile Co., Ltd. and Zhejiang Geely Automobile Co., Ltd. GM, Volkswagen, Citroen and Chrysler North America are the company’s core customers. Since 2008, the company has supplied power steering gears to a Sino-foreign joint venture established in China by General Motors, Citroen and Volkswagen. Since 2009, the company has supplied power steering gears to North America Chrys.

The marketing team of China Automotive Systems has 136 employees and is divided into the OEM management department, after-sales service department and international business department. These marketing teams keep in touch with the company’s core customers. They are stationed in major automobile production areas under the company’s organization, aiming to more effectively represent customer interests, promote customer projects, and coordinate customer strategies to improve overall service quality and satisfaction. The company’s ability to support customers will be further enhanced through its extensive presence in sales organizations, manufacturing facilities, engineering technology centers, and joint ventures.

China Automotive Systems will focus on brand recognition, quality control, cost reduction, research and development, and strategic mergers and acquisitions to achieve domestic and international market expansion. The company’s complete organizational structure, high-quality and affordable products, strong R&D capabilities and its leading market position will support the company’s continuous development and become an international power steering system supplier in the near future.

Subsidiaries of China Automotive Systems (CAAS):

  1. Hubei Henglong Automotive System Group Co., Ltd. (founded in 2007, 472 employees)
  2. Shashi Jiulong Automobile Power Steering Gear Co., Ltd. (Established time: 1993 / Number of employees: 2,881 (including Jingzhou Henglong and Technical Inspection Center))
  3. Jingzhou Henglong Auto Parts Manufacturing Co., Ltd. (Established time: 1997 / Number of employees: 2,881 (including Shashi Jiulong and Technical Inspection Center))
  4. Shenyang Jinbei Henglong Automotive Steering System Co., Ltd. (Established: 2002 / Number of Employees: 328)
  5. Hubei Hongying Sensor Technology Co., Ltd. (Established: 2005 / Number of Employees: 20)
  6. Wuhu Henglong Automobile Steering System Co., Ltd. (Established time: 2006 / Number of employees: 143)
  7. Wuhan Jielong Automobile Electric Power Steering System Co., Ltd. (Establishment time: 2006 / Number of employees: 238)
  8. Hang Lung American Company (Established: 2007 / Number of Employees: 12)
  9. Jingzhou Henglong Automobile Technology (Testing) Center (Established: 2009 / Number of Employees: 2,881 (including Jingzhou Henglong and Shashi Jiulong))
  10. Beijing Hainachuan Henglong Automotive Steering System Co., Ltd. (Established time: 2010)
  11. Chongqing Henglong Hongyan Automobile Steering System Co., Ltd. (Established time: 2012 / Number of employees: 113)
  12. CAAS Brazil Auto Parts Import and Trade Co., Ltd. (Established: 2012 / Number of Employees: 10)
  13. Wuhan Chuguanjie Automobile Technology Co., Ltd. (Established: 2014)
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