Faurecia has signed of an agreement with Changchun municipality and auto supplier Xuyang Group, in which it holds a majority stake, and said the move would accelerate its development in China.
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Under the terms of the agreement with Changchun, Faurecia will take a stake in Xuyang Group, becoming the strategic shareholder of one of the key suppliers to automaker FAW Group and its international affiliates inlcuding FAW-VW which builds Audi and Volkswagen cars locally.
Faurecia said it epected to expand its involvement with FAW and its affiliates in three areas.
The Changchun Faurecia Xuyang Automotive Seat joint venture, founded in 2001 and held 60% by Faurecia and 40% by Xuyang, currently specialising in seat frames, will expand to make complete seats.
Two new joint ventures will be created to make interior systems, building on Faurecia’s existing Changchun plant and acoustic modules and floor carpets, building on existing Xuyang plants.
Faurecia plans to finalise these agreements during the first half of 2010.
The city of Changchun is one of the main automobile production centres in China, hosting FAW and its JVs with VW, Toyota and GM, producing some 1.5m vehicles in 2009, with a target of 2m from 2011 and 3m in five years.
China is a strategic development area for Faurecia. The group already has 15 plants and three R&D centres there, with some 3,400 employees, and will achieve 2009 sales of EUR 600m – up 35% compared with 2008.
A Faurecia spokesman could not immediately confirm the size of the Xuyang stake or the price Faurecia is paying for the deal.
