Motorola Signs Agreement With Tianjin Economic Technological Development Area (TEDA) to Further Motorola Investment in China
New Manufacturing Facility Expected to Become Automotive Electronics Supply Source for the Chinese Automotive Market -- Among the World's Fastest Growing Automotive Markets
TIANJIN, China, April 27 -- Motorola, Inc. today signed an agreement with the Tianjin Economic Technological Development Area (TEDA) to build a new manufacturing facility that will expand Motorola's presence in one of the world's fastest growing automotive markets. The new facility is expected to be built in phases. The first phase is to be complete in late 2004 and will be about 200,000 square feet.
The new facility will be adjacent to existing Motorola manufacturing facilities in Tianjin. The majority of manufacturing will be for Motorola's automotive electronics business, which will produce engine control units, interior electronics, telematics and powertrain products as soon as 2005. The new facility also will have manufacturing lines for Motorola's embedded computing and energy systems businesses.
From an automotive perspective, the new facility will give Motorola an opportunity to aggressively compete in the Chinese automotive electronics market. According to Global Insight, a leading automotive market research firm, China automotive vehicle sales (passenger car, light commercial and heavy commercial vehicles) grew from 3.46 million units in 2002 to 4.10 million units in 2003, representing a compound annual growth rate (CAGR) of 18.5 percent. The firm also forecasted, in December of 2003, that China global vehicle sales are expected to account for 25 percent of the growth from 2006 to 2007.
"This opportunity is a double-play for Motorola. Worldwide, we continue to see an increased demand for electronic content in vehicles, growing at a rate of about 9 percent. So, match that content demand with the market growth opportunities in China, and we're excited to partner with our customers and deliver Motorola's automotive electronic technologies and solutions in markets worldwide," said Marios Zenios, senior vice president and general manager of Motorola Automotive.
As stated in its first quarter 2004 earnings announcement, Motorola noted that for the third consecutive quarter, its automotive business received significant new and replacement business awards with a combined value of more than $1 billion in lifetime value over several years. The wins are across all regions of the world, including China, and in the areas of telematics, sensors, chassis, powertrain control, and interior electronics.
These awards are examples of the growing demand Motorola is experiencing for its automotive electronics. Motorola would like to open the new Tianjin facility to help speed the time-to-market of key components so its customers can reduce overall vehicle program costs.
"This is another example of Motorola's long term commitment to China," said Daniel Shih, corporate vice president and president, Motorola China. "We are committed to establishing global production and research and development capabilities in China. The contract signing today signifies Motorola China is focused on developing the capability needed to support high-growth markets like automotive electronics."
About Motorola
Motorola, Inc. is a global leader in wireless, broadband and automotive communications technologies that help make life smarter, safer, simpler, synchronized and fun. Sales in 2003 were U.S. $27.1 billion. Motorola creates innovative technological solutions that benefit people at home, at work and on the move. The company also is a progressive corporate citizen dedicated to operating ethically, protecting the environment and supporting the communities in which it does business. Motorola's sales in China in 2003 were U.S. $4.67 billion. For more information: www.motorola.com .
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