ZF Forms Joint Venture with FAWER in China

FRIEDRICHSHAFEN, Germany and CHANGCHUN, China, Nov. 25, 2003 -- ZF announced today it has signed an agreement for the foundation of a strategic joint venture with the automotive supplier FAWER in Changchun, China. The new joint venture will produce chassis components and systems for passenger cars and commercial vehicles made in China.

The company will be called ZF FAWER Chassis Technology Co. Ltd., and will be located in Changchun. Planned products include: chassis components from the ZF Car Chassis Technology, and Off-Road Driveline Technology and Axle Systems Divisions. In the medium term, ZF may supply complete axle systems for passenger cars. For the ZF Group, ZF Lemforder Metallwaren AG holds 51 percent of the shares with FAWER 49 percent.

FAWER is an affiliated corporation of FAW, one of China's largest vehicle manufacturers. FAW produces its own vehicles and cooperates with the VW Group as well as Japanese automakers.

"We expect this commitment to bring a new dynamic to our business relations with automakers in China," said Hans-Georg Haerter, who directs ZF Asia/Pacific region interests. "Along with ten ZF plants in the country, we can now offer the Chinese market the entire range of ZF competence in driveline and chassis technology."

ZF Friedrichshafen AG is a leading worldwide supplier of driveline and chassis technology. Headquartered in Friedrichshafen, Germany, ZF is among the 15 largest automotive suppliers in the world. The company has a total workforce of 53,300 at 119 locations in 25 countries, and combined revenues for the group totaled more than $10 billion in 2002.

ZF operates a large manufacturing network in North America, combined with global research and development capabilities, to provide advanced technology to the region. The ZF Group North American Operations Technical Center is located in Northville, Michigan.