Delphi China Reports 50 Percent Consolidated Sales Growth in 2003

Leading auto components supplier well-positioned for long-term growth

SHANGHAI, China, June 10 -- Delphi Corp. China recently announced that its consolidated sales in China had reached US$650 million in 2003, increasing approximately 50 percent compared with the previous year. To maintain its leading position in the Chinese market, Delphi China is striving to diversify itself from a manufacturing center to include research and development to bring advanced technologies into China.

"We expect Delphi China's positive growth trend to continue," said Jinya Chen, president of Delphi Automotive Systems (China) Holding Co., Ltd. "Our customers increasingly want world-class technologies and local technical support to differentiate their vehicles in China's competitive market. Only by introducing more first-rate technologies, driving R&D capability in China, and providing excellent value and service to customers, can we meet our customers' expectations."

To date, Delphi operates 14 legal entities in China involving total investment of more than US$450 million. These operations manufacture more than 40 categories of products for customers in China and overseas.

  The following are noteworthy developments in 2003:

  Driving R&D capability

Delphi recently announced a US$50 million investment in its first R&D center in China. As a wholly owned entity of Delphi, Delphi China Technical Center Co., Ltd will be located in Waigaoqiao Free Trade Zone in Shanghai's Pudong New Area. The first phase of construction is expected for completion in June 2005 and will initially employ 500 employees. The center will develop components and support application and systems engineering for local and overseas customers and transplant automakers.

"The Delphi China Technical Center is a significant milestone for us. It represents an important strategic move -- building world-class research and development capabilities on top of our extensive manufacturing presence. Our vision is to build our China Technical Center into a first class R&D center," Jinya Chen said. "China is more than a simple manufacturing and export center -- it is capable of becoming a global engineering center. We will lead China's development in making it a reality."

Delphi is also focused on training local talent. Delphi China established the Delphi-Tsinghua Institute -- a joint-training technology institute with China's premier technology university -- to develop the next generation of engineers in China. Delphi will also send more than 60 engineers for 6- to 18-month training terms in the United States.

Introducing more advanced technologies

Delphi is committed to bringing world-class technologies to China. In June 2003, Delphi announced in Shanghai it would invest US$12 million to introduce the advanced Multec 3 gasoline fuel injectors and begin initial production at the Delphi Shanghai Dynamic and Propulsion Systems Co. Ltd. in September. The fuel injector is the core component of a vehicle's engine management system (EMS). Delphi's advanced Multec 3 injector features the latest technology, which offers improved performance at lowered costs, and was launched in the U.S. and European markets last year.

Expanding sourcing in China

China's ability in sourcing plays a significant role in Delphi's global supply strategy. Local auto component suppliers have made considerable improvements in terms of quality and delivery in the last decade.

Many multinationals, including Delphi and its major customers, have recently expanded procurement in China. In 2003, Delphi sourced almost US$225 million worth of goods from local suppliers. Last year, Delphi attended two sourcing fairs -- the 2003 China Chongqing Global Sourcing Fair and the International Sourcing Conference in Shanghai -- to explore opportunities of sourcing more from China.

Gaining customer recognition

All Delphi ventures in China are QS-9000/ISO 9000 certified, a priority in Delphi's global strategy. High operating standards like these have resulted in high recognition from Delphi's customers. In 2003, Delphi China ventures received 16 awards from global customers as well as local OEMs such as SAIC GM Wuling, Nanjing Fiat, Changhe Suzuki, Hainan Mazda, Brilliance, and more. In January 2003, Honda presented Delphi's Shanghai, China operation with its Excellent Supplier Award to acknowledge the Freedom(TM) battery's exemplary product quality, service, delivery and price point. For the third consecutive year, Beijing Delphi Wanyuan Engine Management Systems Co., Ltd. earned SAIC- GM-Wuling Automobile Corp.'s Best Supplier award.

Jinya Chen said, "We continue to focus on excellence by striving to exceed customer expectations through outstanding quality products and services, and to become the best supplier in the eyes of our customers."

For more information on Delphi Corporation, please visit http://www.delphi.com .