China XD Plastics Brakes Ground on New Production Facility
HARBIN, China--Dec. 23, 2013: China XD Plastics Company Limited , one of China's leading specialty chemical players engaged in the development, manufacture, and sale of polymer composites primarily for automotive applications, today announced it broke ground on a 300,000 tons polymer composites production and R&D project in Southwest China that would expand production capacity by 300,000 metric tons and equipped with a professional research and development center and an independent training center.
China XD's southwest expansion project is situated in an area of 3,230,000 square feet in Nanchong City, Sichuan province, the hub of the economic circle in Chengdu and Chongqing. Within a 500-kilometer radius of the construction site, there are factories for automotive manufacturers such as First Automobile Group, Shanghai GM, Volvo, Changan Ford and Dongfeng, etc. The region is also home to industries of high-end applications that the Company has been pursuing, including China Southern Rail Corporation ("CSR") and China Northern Rail Corporation ("CNR") in the high-speed railway sector, and Xi'an Aircraft Industry (Group) Company Limited, Chengdu Aircraft Industrial (Group) Company Limited and Guizhou Aviation Industry (Group) Company Limited, etc. The mayor and municipal party secretary of Nanchong City joined the groundbreaking ceremony, marking the official commencement of the project in the southwest. At the groundbreaking ceremony, Mr. Jie Han, Chairman and CEO of China XD Plastics, said, "China XD breaking ground on a 300,000 tons polymer composites production and R&D project in Southwest China today is another critical milestone for the Company following the launch of 45,000, 120,000 and 225,000 metric tons production bases in tandem in Northeastern China. We are pleased to be here with the support of the provincial, municipal and district governments."
According to the its development plan, the Company plans to complete the project in approximately two years, funded with its existing cash, its future operating cash flows and loans. The decision to build the fourth production base follows China's 12th Five-Year Plan, which promotes green and environmental protection sectors and new material industries. The Company will benefit from favorable tax policies under China's Western Development Program by locating the project in Southwest China. The launch of the southwest base is expected to facilitate profit maximization for the Company, and on the basis that products from the northeast bases cover Northeastern and Northern China and radiate into Eastern China, this southwest base is expected to help fulfill the nationwide layout where products will cover Southwestern, Southern and Central China and further radiate into Eastern China, which will lay a solid foundation for maintaining a leading role in China's industries and as a result, help realize our transformation from a leading plastic new material enterprise in China to a leading specialty chemical player in Asia engaged in polymer composites.