Delphi Expands Diesel Presence in Asia-Pacific

New business wins demonstrate progress in building relationships with Asian automakers

Delphi invests in new diesel support facilities in China, Korea and India

New senior diesel executive moves to Shanghai to provide better local support

TOKYO, Oct. 25 -- Delphi Corp. , the world's second largest supplier of diesel injection systems and common rail technology, has been working with regional vehicle manufacturers for more than 20 years. Vehicles or engines equipped with Delphi diesel fuel injection equipment include Hyundai, Kia, SsangYong, Daewoo, Nissan, Isuzu, Tata, Mahindra & Mahindra, Maruti and others.

Delphi recently has won repeat or new diesel common rail contracts with Hyundai-Kia, SsangYong, Tata and four other customers to be named in the coming months -- this includes three Chinese engine manufacturers. Delphi's Multec diesel common rail system has been designed to help customers meet current and future stringent emissions requirements and help improve fuel economy and engine performance.

As Delphi Diesel Systems expansion and commitment to Asia Pacific increases, the organization is transitioning from a European base to a global entity due to increased sales.

Footprint Expansion

Delphi Diesel Systems has been present in the region since 1979 through partnerships in India and Korea. Delphi Diesel Systems introduced its electronic unit injector (EUI) to the Korean market in 2000, and its diesel common rail system in 2001, supplying to Hyundai/Kia. Delphi continues to grow its ventures with local technical development capabilities in key vehicle subsystems required to advance the Korean OEM's global growth.

The India based joint venture, Delphi-TVS was created in 1989 together with the TVS group, the largest and most diversified automotive supplier in the country.

Delphi also plans to develop common rail manufacturing in the Asia Pacific region, using manufacturing systems proven at its plants in the United Kingdom, France and Spain. The company will use its existing footprint in India and Korea as well as develop capabilities to manufacture in China. The plan is to implement a capacity of one million common rail systems annually in Asia to supply a growing local market and to release capacity at its European plants to support planned growth in that market.

"We have taken a hard look at diesel growth around the world and come up with an investment plan that we believe will allow Delphi to provide the best, most appropriate responses anywhere in the world," said Guy Hachey, vice president Delphi Corporation and president, Delphi Energy & Chassis. "Our success in Europe has proved our capability and helped our customers introduce vehicles that are recognized as class-leaders. We now hope to deliver that capability to our customers in Asia-Pacific, where we see tremendous growth opportunity for both diesel and gasoline engine management systems."

Enhancing Engineering and Support Capabilities

In July, Delphi announced it will open a China Technical Center in Shanghai to support existing and future business in the region with a planned investment of $50m. The first phase is expected to be completed in July 2005, and will initially employ 500 engineers and scientists. The new facility will support business with local vehicle manufacturers, as well as global customers developing in the country. Among many expertise and R&D capabilities the future China Tech Center boast, one is to provide local diesel applications engineering support, including a full calibration capability.

The Delphi China Tech Center also will work closely with Delphi's rapidly expanding capability in India, including the electronics technical center in Bangalore (to provide a vehicle-wide integration capability) and the joint venture with TVS. The Bangalore Technical Center plays a critical role in providing embedded software systems for many of Delphi's fastest growing product lines, including diesel common rail engine management systems. Delphi-TVS was the first company to manufacture modern passenger car rotary diesel injection technology in India in 1991, and in the coming months, plans to be the first to develop and introduce common rail systems for a leading domestic vehicle manufacturer on an Indian-manufactured engine.

In Korea, Delphi recently opened a state of the art technical center, located in the province of Yong-in, Seoul, with an initial investment in excess of US$20 million. A team of 240 engineers and support personnel will initially focus on developing gasoline and diesel engine management systems for its customers.

Local Management Appointment

Delphi has committed to a series of moves that will make its support of local automakers even stronger. In a senior management change, Pascal Dutfoy has been appointed diesel product line manager for Delphi Asia Pacific. Dutfoy will be located at Delphi's China headquarters in Shanghai, and he will report to both Jon DeGaynor, business line executive, Delphi Diesel Systems, and to Herman Chang, regional director, Delphi Energy & Chassis and Delphi Steering. The move is effective immediately.

"We are committed to providing our customers with the best local support possible, because we recognize the Asian automakers demand it," DeGaynor said. "Pascal brings tremendous credentials to this assignment, and he will lead the Delphi team in supporting our A/P programs as well as developing our manufacturing, purchasing and engineering capabilities in the region. In addition, Pascal will work with our Asian customers to help them build their diesel programs not just at home, but in international markets, as well. Our worldwide diesel capabilities are enormous, and we can help Asian automakers develop and grow in any market."

Dutfoy's announcement follows a series of recent announcements in which Delphi is growing its diesel capabilities in Asia.

Delphi Provides Cost-effective Technology

Delphi was the first company to introduce closed loop fuel injection control strategies, using a patented technology called Accelerometer Pilot Control (APC). By directly monitoring in-cylinder combustion quality, APC allows the engine management system to automatically optimize its calibration as conditions change. The system has been proven to yield very effective emissions control as well as reduced noise, and to help the engine maintain these attributes as it ages.

Delphi will also introduce a new generation of high-pressure pumps during 2005. The design is scaleable for engines from 1.4 liters to 8 liters, providing substantial economies in both design and manufacturing. The new pumps, which will initially be manufactured in Barcelona, Spain, provide pressures up to 2,000 bar combined with very high levels of durability and reliability.

Complementing technologies can offer a complete emission system solution

Complementing these injection technologies are Delphi's broad range of combustion control systems such as EGR and variable valve timing, and its comprehensive portfolio of aftertreatment systems.

"As stricter diesel emission regulations take effect in China, we anticipate considerable growth in demand for diesel aftertreatment products," says DeGaynor. Delphi is ready today to offer Diesel Oxidation catalyst technologies to meet Euro II and Euro III emission standards. Delphi's Diesel Catalyzed Particulate Trap is another key technology ready today to meet future particulate matter emission standards.

Combined with capabilities in diesel fuel injection systems and engine management systems, Delphi can not only optimize individual catalyst component performance but also offer full exhaust systems to provide high value emission system solutions for our customers.

"To meet individual customer needs, Delphi is ready to supply any level of technology or to develop a complete, optimized system from fuel tank to tailpipe," says DeGaynor.

Delphi operates in nine countries in the Asia-Pacific region and employs 9,000 people in consolidated operations and more than 17,000 people within joint ventures. In 2003, Delphi sales in the region totaled $2.7 billion.