SwRI, Chinese Auto Industry Regulator Agree to Enter Joint Venture

SAN ANTONIO--April 13, 2005--Southwest Research Institute(R) (SwRI) and the state-owned China Automotive Technology and Research Center (CATARC) have agreed to form a joint-venture company to provide research, development and testing services for automotive products, components and systems in China.

The joint venture, called Tianjin SwARC Automotive Research Laboratory Co., Ltd., will be located in Tianjin City, People's Republic of China.

The company will provide independent and impartial evaluation of automotive products, powertrain components and automotive system designs. It also will develop test protocols for evaluating exhaust aftertreatment devices and systems and will organize and conduct consortium research and development experiments and tests for the Chinese government and transportation and energy industries.

SwRI, which currently operates a representative business office in Beijing, will establish a technical presence in China and further its scientific purposes through its participation in the joint venture. SwARC will draw on SwRI's expertise in automotive emissions research and its leadership role in developing test protocols for diesel aftertreatment evaluations in the U.S. It will utilize laboratories, equipment and buildings owned by CATARC.

J. Dan Bates, Southwest Research Institute president, said, "This joint venture places SwRI emissions technology closer to the growing automobile market in China. At the same time, it also supports the mission of CATARC."

CATARC's President, Professor Zhao Hang, explained that SwARC in Chinese is composed by two characters. The first one means "seek, explore," the second means "conquer." Zhao said he believes that the formation of SwARC is a good start. "I hope the company will devote its resources to seeking truth, will explore automotive hi-tech fields courageously, will conquer the most difficult challenges, and achieve success by furthering cooperation," he said.

SwRI will own 55 percent of the new company and will nominate four of seven directors for its board.

CATARC, based in Tianjin, is a state-owned technical and administrative entity of the Chinese automotive industry. It provides standardization and technical regulation, product certification and testing research, quality system certification, information and databases for the auto industry, engineering management and design, enterprise management science research, and automotive high-technology development and applications.

SwRI, based in San Antonio, is an independent, nonprofit applied engineering and physical sciences research and development organization with 2,900 employees. Its 11 technical divisions include the Engine, Emissions and Vehicle Research Division, and the Fuels and Lubricants Research Division. The two divisions are overseen by the Office of Automotive Engineering.

SwRI is an independent, nonprofit, applied research and development organization based in San Antonio, with more than 2,800 employees and an annual research volume of more than $399 million.