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ISSN-1652X

1-11

VEHICLE COMPONENT

THE

CHINAin focus

Booming regions21 visiting suppliers

F KG - F O R D O N S KO M P O N E N T G R U P P E N

Translations increase

sales

Truck.

Plåt, grov plåt och inte minst gasskuren plåt från oss används varje dag av Sveriges tillverkare av truckar, entreprenadmaskiner, skogsmaskiner och gruvmaskiner. Liksom av deras underleverantörer. Tonvis som frigör kapital, minskar lager, skapar flexibilitet, förenklar administration och resulterar i lägre kassation. Med mera. Behöver du balk, rör, stång, profiler och plåt i stål, rostfritt eller aluminium? Välkommen att se allt som vi kan erbjuda på www.begroup.se

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ISSN-1652-862X.

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THE VEHICLE COMPONENT 1/11 3

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The Scandinavian Vehicle Component is issued six times a year in Swedish or English.

Head quarters: Bror Nilssons gata 4, Älvstranden. SE-417 55 Göteborg. Phone +46-31-711 89 01. Fax +46-31-711 89 04. E-mail: [email protected]

Publisher: Svenåke Berglie, President of FKG - Fordons-komponentgruppen AB. Mobile phone: +46-703-410 123. E-mail: [email protected]

Editor-in-Chief: Tege Tornvall. Box 126, SE-793 23 Leksand. Phone +46-247-137 25. Mobile phone +46-70-628 87 76. E-mail: [email protected]

Advertising: The Vehicle Component. Johan Turian. Ad 4 you media AB. Krukmakargatan 35 C, SE-118 51 Stockholm. Phone +46 8 556 950 44. Fax +46-8-556 960 19. E-mail: [email protected].

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SVEAChairman: Lars-Gustaf Hauptmann,Färåsvägen 14, SE-428 37 Kållered.Tel. +46-31-795 35 21,mob. +46-731-40 25 09.E-mail: [email protected]: Rönnbärsgången 7, SE-436 54 Hovås.Tel +46-31-16 99 85.Fax: +46-31-16 93 75.E-mail: [email protected]: www.sveafordon.com

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ISSN-1652-862X. Copyright: C FKG 2011.

Printed copies: 3,200 Swedish and 800 EnglishAudited circulation: 3,430

All texts in this issue are by the editor (TEGE) and express his views, if not marked otherwise.

Cover: Skilled craftsmen and green buses in China.

5 China in focus. On March 27, 21 Scandi-navian automotive suppliers will gather in Shanghai for meetings with Chinese vehicle manufacturers and suppliers and visits to Volvo Car, Geely, Sunwin/Volvo Bus, Volvo Construction Equipment, Kongsberg Auto-motive and SAPA.

8 Car-loving trade minister. Sweden’s mi-nuster of trade, Ewa Björling, supports the Scandinavian supplier visit to China - and is also a fan of cars, not least racing cars.

9 Going east. The reason for Scandinavian suppliers to operate in China is rather fol-lowing their customers and finding new and growing markets than benefitting from low costs, which won’t last forever.

10 Booming regions. The Scandinavian suppli-er visit is mainly to Shanghai and surround-ing areas with their booming growth. But China has also rural, less dynamic regions.

11 New market. Most Scandinavian suppliers in China so far have fellow Scandinavian or European companies as customers. But they also have domestic Chinese companies in sight.

12 21 qualified Scandinavian suppliers. Presentation of participating companies.

16 New 5-year plan. Slower growth, focus on inland and western regions and stimulating private consumption are cornerstones of China’s next 5-year plan.

17 Watertight JV deals - European partners. Kongsberg Automotive vice president Bent Wessel-Aas advises Scandinavian suppliers to go on their own in Chinese operations. Law firm Mannheimer Swartling advises them to find partners from home.

18 Volvo Car prepares for China. With new factories first in Chengdu and later in Daq-ing and Jiading, Volvo Car aims at 800,000 cars sold per year by 2020. But there are conflicting demands in what cars to develop and sell.

20 Fast growing bus market. As 50/50 owner of Sunwin and Silver Bus and also importing from Europe, Volvo Bus is a major player on China’s dynamic bus market - mainly for high tech, lean and green buses.

21 Dedicated Chinese. Chinese employees have a very positive attitude and are keen to improve themselves.

22 SVEN pages: Translation increases sales.

CONTENTS 1/11

Editorial cooperation

The Vehicle Component now cooperates with Automotive Sweden, sharing material both ways. Short news will be found in Automotive Sweden’s newsletter and on FKG’s website. /Tege Tornvall, Editor-in Chief.

4 THE VEHICLE COMPONENT 1/11

Svenåke BerglieManaging Director [email protected]

China – here we come!The world’s automotive industry is rapidly recovering from the recent crisis. Volume forecasts

for 2013 and later on for 2020 are even higher than they were before the crisis. The annual production forecast for 2020 is 100 million vehicles. Three per cent of these vehicles are ex-

pected to be electric – three million vehicles.But the growth will be unevenly spread. Production in North America and Western Europe will

recover but will probably not reach 2007 levels. The growth will come in Brazil, Russia, India and China, the so called BRIC countries.

This doesn’t mean that the more mature markets like North America and Western Europe are without interest for OEMs and suppliers. Both are very big markets and so far also technological leaders. But as a supplier you have to take a strategic position with regards to the BRIC countries.

In October and November last year, FKG for the second time arranged Go Global projects in In-dia and Brazil, supported by the Swedish Business Development Agency. Both countries show great optimism, even if Brazil is a much more developed and mature automotive market than India.

Some participating suppliers will probably invest in both India and Brazil. The main reason for this is to serve existing customers. At the same time, you strengthen your position in other markets, where existing customers produce. Brazil also has local regulations for content of components and technology, which will require local production.

It is quite easy for Western European companies to invest in Brazil and India. Their legislation is similar to what we are used to in Europe. English is spoken by almost all business people. European industry has a long experience from working in both Brazil and India.

China is different. First of all, it’s a huge market, the biggest of all as well as the fastest growing. OEMs like GM, VW, Toyota, Nissan, etc. as well as the big suppliers are in China since long.

All OEMs are tied up in joint ventures, which is mandatory.Most suppliers seem to prefer green field investments of their own. You invest in Brazil, India

and China to serve your customer and supply the local market. Export is also an option, but logistic costs can easily kill exporting components.

For Scandinavian suppliers with no China experience, both the opportunities and challenges are big. The opportunities are of course connected to OEMs starting up or expanding in China. Just the organic growth can be immense. But tier 2 suppliers can also find strategic positions in China to serve their tier 1 customers.

But if opportunities are great, so are the challenges. The cultural differences between Europe and China are significant. As a newcomer, you have to learn about these differences. The legisla-tion in China differs very much from what we are used to, and bureaucracy can also be a challenge. Intellectual Property Rights issues also have to be addressed in China.

Taking decisions about a China strategy is a necessity for Scandinavian suppliers. Under Geely ownership, Volvo Car will certainly have a much more aggressive China strategy than during its Ford time.

For heavy vehicles, AB Volvo is still struggling with its truck strategy but VCE and Volvo Bus joint ventures are doing well. If Scania gets more tied up with VW, it might get a new China strategy.

With this background, it’s easy to understand the reasons for our third China Go Global project. We want to make it easier for Nordic suppliers to quickly find strong positions in the world’s fastest growing market.

China – here we come!

A part of the future in automotive industry

We offer a complete process from product development to a customised logistic chain:

welding ∙ powdercoating ∙ sheet metal processingautomatic pressing ∙ manual pressing ∙ assembling

Production locations in Sweden, Lithuania and Chinawww.nitator.se


On March 27, no less than 20 Scandinavian supplier companies to the automotive industry will gather in Shanghai for a week of visits to China-based vehicle producers and suppliers. In total, the group will count at least 50 partici-pants and is the biggest such visit to China ever from Scandinavia.

The group is headed by Mr. Svenåke Berglie, managing director of FKG, the asso-

ciation of Nordic suppliers to the world’s automotive industry. He is the driving force behind the Go Global programme, which for ten years has made Nordic suppliers visit countries, regions and vehicle producers of interest for production, procurement and sales.

Countries visited include China, India, South Korea, Brazil, USA, Germany, France, England, Italy, Turkey, Rus-sia, Poland, the Baltic states, Hungary, the Czech Republic, Slovakia, Slovenia, Roumania and Ukraina.

This will be the third visit to China, this time with a focus on potential business opportunities

Chinain focusReaching for the

sky: Shanghai World Financial Center, 492 m high.


Participating companies

PHOTOS: ERLAND LINDAu

Kongsberg Automotive with several plants around Shanghai for gear shift and interior com-ponents

Leax, supplier of machined pow-ertrain parts with eyes on China

MCC Mobile Climate Control, AC, heating and ventilation for buses and commercial vehicles

Nitator, machined metal compo-nents with contracted Chinese production

Plastal, engineered plastic front and rear bumpers and other body parts, now ready for China

Promens, Icelandic supplier of injection moulded plastic parts

Raufoss, supplier of aluminium suspension parts with plant in Suzhou

REC Resident Engineering Co, marketing consultants planning to establish a Nordic supplier office in Shanghai

Tristone took over Trelleborg’s engine cooling systems and parts and now plans for China

Verktygsmekano offers service and maintenance on plastic forming tools and has contracted Chinese production.

with Volvo Cars and Geely and the supplier cluster they will need for their ambitious Chinese growth plans.

The group will visit Volvo Car’s Chinese headquarters in Jiading as well as Geely’s plant in Beilun with a full day of talks with Geely representatives and suppliers.

The programme also includes visits to Volvo Construction Equipment (SAIC/Volvo Bus) in Pudong, Sunwin (owned by Volvo Bus) in Nanjing and Scandinavian suppliers such as Autoliv, Kongsberg Automotive and Sapa as well as Jiading and NIP industrial parks.

Further, the group will meet logistics specialist Schenker and visit local Chinese supplier com-panies with an optional extension to Chengdu after the regular promgramme is terminated. At a special gala dinner, the group will meet representatives from the region Ministry of Com-merce and Foreign Trade.

Before leaving Sweden, participants were informed about China and its automo-tive industry at a seminar, held by technology and production consultants Fasitet, active in China since 2007. The seminar addressed issues such as working and living in China, Chinese culture, language and customs, the Chinese business culture, Swedish companies in China -and Chinese in Sweden.

The whole visit is managed by REC (Resident Engineering Co.), marketing consultants who have created an office for Nordic automotive suppliers in Mainz in Germany and now plan to do the same in Shanghai as a service for companies needing a base for their Chinese activities.

Financial support for the visit has been given by the Swedish Agency for Economic and Regional Growth. Administrative and contach assistance has been given by the Swedish Export Council.TEGE

Shanghai’s imposing skyline from the river.

AP&T automatic sheet metal press lines with sales and service office in Shanghai

Arkivator engine and chassis components with Chinese plant in Kunshan

Aros Quality Group with two Chinese operations for thin sheet and cable components

Autoliv with ten Chinese pro-duction sites for vehicle safety equipment

COT Clean Oil Technology with plans for Chinese sales

Essve fastenings with sales office in Shanghai and contracted Chinese producers

Fasitet technology and produc-tion consultants with Chinese

Gera Technology, Norwegian supplier of blow moulded plastic parts, not yet in China

Gnotec, components for security equipment with assembly in Hong Kong

Hardtech Gestamp, press hard-ened supporting steel structures

KB Konstruktionsbakelit, composite components, plans for China


Sweden’s trade minister Ewa Björling is also a Doctor of Medicine and has been asso-ciate professor in virology at the Institute of Micro Biology, Tumour and Cellular Biology (MTC) of Karolinska Institutet in Stockholm. She also has a personal interest in cars - particularly racing cars.

Among issues still to be solved are transparent bilateral sourcing with free and open competition, state credit subsidies to state-owned companies, and immaterial prop-erty rights.

- Free competition is still lim-ited by certain restrictions, such as the demand for joint ventures for foreign vehicle manufacturers in China and the need for compat-ible technical standards in certain areas, says Ewa Björling.

She stresses the importance of Sweden’s automotive industry and its many qualified and strong suppliers with their experience and competence in fields such as vehicle and traffic safety, clean and mean engine technology and clean and efficient production processes.

- For green technology, China is already Sweden’s second largest export market, says Ewa Björling. TEGE

cord annual growth rates of 20-40 per cent. This reflects not only the general Chinese economic growth of 8-10 per cent per year, but also the even stronger growth in major areas such as automotive and telecom.

To grow even faster, Swedish companies in China must also take market shares. So far, Swed-ish suppliers present in China have few other customers than vehicle producers and suppliers with Nordic or European owners.

New trade agreementBut this may soon change. Since ten years, the Swedish and Chinese governments have been negotiating on new multilateral terms of trade for the future.

- We are now close to fulfill-ing these negotiations and have more than 80 per cent of the new terms fixed, says Ewa Björling.

Fast growing Chinese tradeSweden’s trade minister welcomes supplier visit to China- This visit of Nordic automotive suppliers to China is a most welcome initiative, says Sweden’s minister of Trade, Mrs. Ewa Björling.

China is fast becoming one of Sweden’s leading trade partners. In 2009, China

was Sweden’s 9th biggest import provider and 10th biggest export market. But China will soon have climbed higher in both respects.

- Our total trade with China was 66 billion SEK (about as many renminbi, RMB) in 2009 - 3 per cent of our total trade. In the next five years, we aim to double our exports to China and will also further increase our imports, says Ewa Björling.

She adds that many Swedish companies present in China re-

Trade minister Ewa Björling with a heart for cars.


China meets the world.

In fact, the present Chinese state is an exception, as China’s history is largely about indepen-dent realms fighting each other. There are inherent tensions between the north and the south, the west and the east.

This is why the top priority of the present Chinese state is stability. Hard to argue against.TEGE

bination of long term planning, mixed state and private owner-ship, free enterprise and competi-tion within certain bounds, and a high degree of flexibility.

Contrary to competing de-mocracies, the Chinese state con-trols all political, financial and fiscal tools in the theoretical tool box - with little room for conflict-ing opinions and interests.

Theoretical wage

Year China Sweden

2010 3,000 RMB 25,000 SEK

2020 7,781 RMB 30,475 SEK

2030 20,182 RMB 37,149 SEK

2038 43,262 RMB 43,526 SEK

The table is purely theoretical extrapolation. It means Chinese operators will need 28 years to catch up with their colleagues in Sweden. However, it disregards purchasing power, currency fluc-tuations and political and market influences.

In reality, neither China nor welfare states will constantly grow by such steps. We could sooner expect China to grow by 5-10 per cent and welfare states only marginally by 1-2 per cent per year. Anyway, China - and also India with 1.2 billion in-habitants - will catch up in a few decades.

That is, provided energy, food, water and other resources as well as global politics allow for it. Extrapolating curves is one of the cardinal sins of all political, economic and social analyzers and planners.

In the long run, China will also meet the demographic problems of an ageing population with fewer working to support it. China’s strong growth will gradu-ally lose speed when it approach-es the same level of welfare as we enjoy in Sweden.

Still, China is on the move with a strong momentum, directed and driven by a powerful state with the reins firm in hand. China’s communist party is pragmatic rather than orthodox. It aims to control the economic, social and political development of the whole country by a com-

Going east is the call of the dayA century ago, going west was the call of the day. The USA was the world’s fastest growing market, attracting both fortune-hunting businessmen and hords of unemployed from all over Europe. But today, the call comes from the east, where China is the world’s fastest growing and soon also biggest market.

The simplest form of motor vehicle.

No wonder, as China with 1.34 billion inhabitants also has the world’s larg-

est population. This is 2.7 times more than the whole of Europe and 4.3 times times bigger than the USA.

So far, the average Chinese in-come per household is little more than 10 percent of that of mature welfare states. But with annual economic and wage growths of close to 10 per cent, China is fast on its way to catch up.

According to several Nordic companies present in China, av-erage wages in the region around Shanghai are as follows:l unqualified blue collar: about

1,500 RMB (about the same in SEK)

l qualified CNC operator: about 3,000 RMB

l office, engineers, sales and management: from 3,000 to 25,000 RMB.Assuming that annual wages

grow by 10 per cent in China against 2 per cent in Sweden, a Chinese CNC operator with 3,000 RMB per month in 2010 will earn more than 43,000 by 2038. Beginning with 25,000 SEK in 2010, a Swedish CNC op-erator also earn 43,000 in 2038.

Theoretical wage growth by 10 per cent in China and 2 per cent in Sweden:


Modern life in mega city Shanghai.

NingboShanghai

Beijng

Hong Kong

ChinaTianjin

Chongqing

Wuxi

Daqing

Guangzhou

Chengdu

PHOTOS: ERLAND LINDAu

largest producer of coal, which is also the country’s main energy source. China also invests in water and nuclear power.Economy: GDP in 2010 was 5.9 bíllion USD or close to 4,300 USD per capita. Annual economic growth is 8-10 per cent. The of-ficial inflation rate is about 5 per cent. Official work force: 814 million people (2009) with 4,2 per cent official unemployment. Currency: Renmimbi (RMB) with fixed rate 6.7695 to the USD, which puts it equal to the SEK.

Main cities by their metro area population (in brackets: administrative area population):Shanghai 17.0 million (18.9)Beijing 13.2 million (17.5)Guangzhou 12.0 (15.0)Shenzhen 8.8 (13.3)Tianjin 8.2 (12.0)Chongqing 7.5 (32.4)Hong Kong 7.1 (7.1)Dongguan 7.0 (8.3)Nanjing 6.8 (7.6)Wuhan 6.6 (9.0).

Industrial area around ShanghaiZhehiang: province south of Shanghai with 103,617 km2 area and more than 52 million inhabit-ants; hilly with rich archipelago along the coast; traditional farming and fishing but fast growing indus-try around harbour town Ningbo with 6 million inhabitants. This is where the Nordic Industrial Park NIP is located.Jiangsu: province north-east of Shanghai with 102,600 km2 area and about 80 million inhabitants. Mostly flatland with farming, gas and oil deposits and fast growing industry. Major cities are Wuxi (meaning no tin, as it used to have tin mines), Kunshan and Nanjing.Shanghai: one of China’s four main cities with close to 20 million inhabitants on 6,341 km2. This equals 3,154 inhabitants per km2. The more densily populated city itself counts about 10 million in-habitants. The area is divided into 16 districts and 3 counties with more than 200 towns and a myriad of smaller administrative units. It is China’s leading business and bank-ing centre and has a subtropical, fertile climate. It is watered by the Yangtze and Huangpu rivers and has a big harbour TEGE

Government: people’s republic with ruling communist party via National People’s Congress and its Standing Committee; deci-sions are carried out by the execu-tive president and ministeries.Administration: 23 provinces (including Taiwan), 5 autono-mous regions (including Tibet), 4 main citiies (Beijing, Chongqing, Shanghai, Tianjin) and 2 admin-istrative regions (Hong Kong and Macau); each province is divided into a hierarchy of prefectures, sub-prefectures, towns and smaller units. Many provinces are the size of major European coun-tries and count 50-100 million inhabitants each.Geography: eastern coastal and fertile area with farming and in-dustries; north-eastern Manchuria colder and drier with mining and industries; south-eastern region with mountains and rich vegetation; central part with rivers, farming and mountains; northern Inner Mongolia with steppes, deserts and mountains; western Xinjiang and Tibet with vast plains, high mountains and sparse population.Natural resources: rich deposits of coal, oil, copper and other minerals; China is the world’s

China’s new, fast growing mega industrial towns in the inland. To ease the strain on fast growing eastern provinces, the state pur-posefully directs more resources to these cities and their sur-rounding areas. The Chongqing province has more than 32 mil-lion inhabitants, and Chengdu is a sub-province of Sichuan and counts some 11 million.

China, basic factsSurface: 9,671,018 km2 (matter of definition)Population: 1.34 billionPer km2: 140 inhabitantsCapital: Beijing, about 13 million inhabitants; the Beijing urban area counts about 18 million

Beijing is not only China’s capital and political and administrative centre but

also one of its major industrial re-gions, close to the former capital Tianjin.

Shanghai is the Chinese mainland’s leading financial and business centre and the hub of a fast growing industrial region.

Guangzhou with close-by Hong Kong is China’s port to the world and open for foreign cultural influences. It is also the centre of a fast growing indus-trial region. Hong Kong itself is China’s second financial centre with more international contacts as a former British colony.

Chongqing and Chengdu are

Booming regionsChina is a state of contrasts. Most of its inhabitants live in its fertile eastern regions, close to rivers, at or not too far from the sea. Its vast inner and eastern regions are sparsely populated with high mountains (including Himalaya), deserts (Gobi and Taklamakan) and cold winters.


Nordic Industrial Park

In cooperation with various countries, China has created a number of industrial parks, closed industri-al sites with favourable conditions for foreign investments and estab-lishings.

One such is NIP, the Nordic Industrial Park close to the big har-

bour Ningbo in the Zhehiang province south of Shanghai. It is owned by the Norwe-gian company Styrbjorn AS and headed by CEO Ove Nodland.

On an area of 275,000 m2 for industrial and commer-cial activities, Ningbo offers 140,000 m2 of office, produc-tion and assembly facilities, not counting 30,000 m2 under construction.

There are still surfaces free for rent, and NIP’s manage-ment staff also offers advice and assistance for mainly Scandinavian companies planning Chinese operations.

On a more modest scale, marketing consultants REC (Resident Engineering Co.) will offer Scandinavian auto-motive suppliers office rooms and services in Shanghai, similar to those they already offer in Mainz in Germany.TEGE

www.nip.com.cn

“We have experience to share”, says consultant Semcon’s automotive head Stefan Ohlsson.

SAPA will receive the Scandinavian supplier group in Jiading.

owned Chinese customers are also Aros Quality Group, Essve, Gnotec, Hardtech, MCC, Kongs-berg, Raufoss, and Tristone. But they all want to bring in local Chinese companies as customers as well.

One strong reason for produc-ing in China to supply customers operating in China is of course low costs to compete with local Chinese suppliers. More expen-sive imports need a high degree of technical sophistication and exclusivity to justify their prices.

But transport costs are still relatively cheap, and several Scandinavian suppliers transport components both ways over the oceans for machining in one place and assembly and delivery in another.

Some Scandinavian suppliers already have domestic Chinese customers. One is machined met-al component supplier Nitator, which uses contracted Chinese producers for customers both in and outside China. Another is Verkstadsmekano, which per-forms service and maintenance on plastic forming tools both in China and on other markets.

Not participating in the visit-ing group are several Scandina-vian suppliers already present in China. Aluminium profile sup-plier Sapa will receive the group as guests on Monday, March 28, and technology and engineering consultant Semcon with some 50 engineers in China is open for questions and visits.

“After five years in China, we have experience to share on Chinese business habits and technology development”, says Semcon’s automotive head Stefan Ohlsson. Semcon is now a global consultant with 3,500 employees outside Sweden and the ability to develop complete vehicles. Customers include Volvo, BMW, Audi and VW.

Other Scandinavian suppliers in China with advice to offer Scandinavian colleagues are Sapa and Kongsberg Automotive, both to be visited by the Scandi-navian group.TEGE

Swedish-, Scandinavian- or Eu-ropean-owned vehicle producers and suppliers already operating in China. Very few so far have local Chinese manufacturers among their customers.

As an example, engine part supplier Arkivator lists the fol-lowing customers for its Chinese operations: Scania, Saab, Volvo Cars, the Volvo group including Mack and Renault Trucks, Au-toliv, Bosch, Haldex, Ljunghäll (light metal cast components), SKF and ZF. Scania and Saab actually mean exporting from China.

Among Scandinavian sup-pliers concentrating on foreign-

New market with low costsFor a long time, the main reason for moving pro-duction from mature industrial areas to developing countries was lower wages. But with economic growth also come raising wages, and one day these countries are no longer low cost.

This has happened in South Korea, is happening in the Czech Republic and will of

course also happen in China. It is only a matter of time. Develop-ing countries are not supposed to remain low-cost forever.

But there is still one good - indeed better - reason to produce in developing countries: they are fast becoming new, growing markets. This is today the main reason for producing in China, to be close to an expanding and potentially huge new market.

For Nordic suppliers, it gener-ally means following Swedish vehicle producing customers to China, India, Brazil and other emerging markets. In fact, Volvo Cars and the Volvo group require them to do so.

In the case of China, Scania so far is not present, Volvo Trucks has burnt its fingers on a joint venture, and Saab’s only presence is by BAIC, which assembles earlier 9-3 and 9-5 models.

But there are also big Scandi-navian suppliers present in China as potential customers. Most of the companies now visiting China supply or plan to supply


21 qualified suppliersThe group visiting China on March 27 - April 1 counts 21 highly qualified Scandi-navian automotive suppliers. Supplementing the list are the following presentations:

Automotive customers: Volvo Car, Volvo group with Mack and Renault Trucks, Scania, Saab, Autoliv, Bosch, Haldex, Ljunghäll, SKF and others.

Headquarters, development and three factories in Sweden. Partners in Brazil.

In China: one plant in Kunshan, Jiangsu. 10 employees with need for more.

Chinese managing director: Mi-kael Helgewall, +86-139 168 14240. [email protected]. www.arkivator.com

AQ Aros Quality GroupIndustry group with 18 companies in Sweden, Italy, Estonia, Bulgaria, Poland, India and China for automo-tive and other fields. Headquarters in Västerås in Sweden.

Presence in China: AQ Holmbergs and AQ Electric in Suzhou west of Shanghai.

Staff in China: Swedish manage-ment and 280 employees for AQ Holmbergs and 150 for AQ Electric.

For automotive applications, AQ Holmbergs makes thin metal stamp-ing components for use in electronic equipment and other applications. AQ Electric produces wiring and cables for power supply and interior heating, and also inductive compo-nents and electrical cabinet assem-blies.

Processes: stamping, pressing, assembly.

Management in China:Managing Director AQ Holm-

bergs: Jonas Palmqvist, +86-512 6808 1216 ext. 20. [email protected]

Managing Director AQ Electric: Andreas Björk, +86-512 6616 3998 ext. 8100. andreas.bjork@aqg,se , www.aqg.se

AutolivWorld leader in automotive safety equipment and systems with 80 plants in 29 countries. About 43,000 employ-ees and a global turnover of about 7 billion USD.

Autoliv supplies most of the world’s vehicle producers on a growing mar-ket, driven by both customer and legal demands.

Headquarters, production and R&D centre in Sweden. Listed on US stock market.

Products: 3-point seat belts and belt systems, airbags, steering wheels, electronic driver assistance, etc.

In China: 10 facilities with 5,400 employees, of which 300 in R&D. Mostly in Shanghai/Nanjing area but also Guangzhou and Changchun. Autoliv has one third of the Chinese market and also exports from China.

Production processes: inhouse component manufacturing, engineer-ing and also crash testing. Autoliv is also an important customer for other suppliers.

Chinese CEO: George Chang, +86-21-691 696 99. www.autoliv.com

COT Clean Oil TechnologyInnovation company with new, pro-tected and patented OilRefiner System for cleaning lubrication and hydraulic oil, mainly in automotive applications. The system keeps oil clean longer and prolongs intervals between filter replacements.

n Sheet Metal Processingn Advanced welding and surface treatmentsn Electric Wiring Systems & Modulesn Plastic Moldingn Inductive Components

AQ Group offers a wide range of advanced technologies:

www.aqg.se

Demand More The Aros Quality Group has approximately 2,500employees in Sweden, Poland, Estonia, Bulgaria, Italy, China and India.

AP&TAutomation-Presses-ToolingDesigns, manufactures and markets complete automated lines of presses and tools for forming of sheet metal and tubes.

Automotive applications: machine lines for press hardening of boron steel for supporting and crash protection structures.

Head quarters and development in Sweden, two factories in Sweden and one in Italy.

Sales and service companies in six countries outside Sweden, including a new office in Shanghai in China.

About 300 employees, of which six in China: two full-time Swedes and four Chinese. Further need for quali-fied people.

Many automotive customers throughout the world. In China: Baosteel, FAW.

Contact: Per Josefsson, Vice Presi-dent Global Sales & Service. +46-325-661800. [email protected]. www.aptgroup.com

ArkivatorProduces machined steel components for powertrain and chassis: rods, shafts, housings, manifolds, etc.

Processes: cutting, turning, milling, drilling, grading, assembly. Product development and prototypes.


often in collaboration with automated press line specialist AP&T. The com-pany now has 34 press hardening lines installed around the world.

Since 2005, Hardtech is owned by the Spanish family-owned industrial group Gestamp Automoción with global operations.

In China, Gestamp has a plant in Kushan north of Shanghai and plans for further Chinese expansion.

Contact: Marketing director Markel Jonsson, +46-920-474 000. [email protected]. www.hardtech.gestamp.com

GnotecThis supplier manufactures metal components for cars, trucks and safety equipment and has a long history as a supplier to the automotive industry.

Gnotec has eight factories in Sweden, Slovakia, Lithuania and Hong Kong with a total of 600 employees.

Focus is on high volume stamping and sheet metal fabrication of parts for various automotive and industrial systems.

Processes used include stamping, welding, laser cutting and assembly, assisted by tool engineering and prototyping.

Gnotec already has an assembly site in Hong Kong but is now considering operations also in the Shanghai area.

Contact: CEO Stefan Ottosson, +46-345-48500. [email protected]. www.gnotec.com

an office in Shanghai, now with some 30 consultants in product develop-ment, technology and production. They are both Chinese and European. Fasitet also has some Chinese consul-tants working in Sweden.

Chinese customers include Volvo Car, Geely, CFMA and suppliers to these companies.

Contact: CEO Ingrid Bergqvist, +46-31-700 1 40. [email protected]

Gera TechnologyA Norwegian specialist in advanced blow moulded plastic components, mainly for automotive functions such as Engine Pipes, Air Ducts, Filler Pipes and Containers.

Main customers are the Scandina-vian Vehicle producers: Volvo Group, Volvo Car, Scania and Saab.

Gera is 100 per cent Norwegian and has its headquarters in Horten with production units in Kongsvinger close to the Swedish border.

Gera has been part of a big global organization in the past and is now looking for new opportunities to go global again.

Contact: CEO Peter Didriksson, +47-941-385 51. [email protected]. www.geratech.no

Gestamp HardtechSpecialists in high strength boron steel for supporting structures and crash protection in vehicles. The company has sprung from Swedish high strength steel producer SSAB and is located in Luleå in the north of Sweden, not far from the iron mines of Kiruna.

Processes used are hot pressing and press hardening in a unique method,

The company has headquarters, R&D and production in Sweden and also an office with REC in Mainz, Germany. It now aims at following Swedish vehicle producers to China.

Contacts:CEO Morgan Ryhman, +46-31-47

29 70. [email protected]. www.cot.se.

Marketing director: Göran Fredriks-son, same ‘phone number. [email protected].

Essve ProdukterThe OEM division of an important Swedish specialist in fastenings. Trading and outsourced production to customer specifications. The group is owned by the big Swedish public company B&B Tools, providing indus-trial necessities with a turnover of 8-9 billion SEK.

Headquarter: Sollentuna north of Stockholm with automotive office north of Gothenburg.

Products: fastening elements such as nuts, bolts, clamps, etc.

Essve wants to follow its Swedish customers to China, notably Volvo Cars. B&B Tools has an office in Shanghai with a staff of 30 under managing director Thomas Sörensson. The group also has an OEM office in Zuchou.

Contact: Product vice president Jan Hultén, +46-303-20 78 00. [email protected]. www.essve.com

FasitetSwedish engineering and industry con-sultants with more than 110 employees and operations in several countries. It is owned by the big German family group Benteler, supplier to automo-tive and other industries with close to 24,000 empoyees in 38 countries.

Present in China since 2007 with

Gestamp’s Chinese plant.


KB Kon struk tions-Bakelit ABPioneer in automotive composites, this company was founded in 1947 to develop bakelite and resin materials for industrial applications.

Located in south Sweden, KB now produces composite components mainly for vehicle manufacturers and their suppliers.

Products include consoles, tanks‚ covers, panels, pillars, housings, car-tridges, etc.

They are produced by injection and compression moulding, and assembled and post treated into finished products.

With production in Sweden and Lithuania, KB is now ready to extend its operations to China.

Contact: Ronnie Törnqvist, Vice President Marketing & Technologies. + 46-435-560 00. [email protected]. www.konstruktions-bakelit.com

Kongsberg AutomotiveA major Norwegian public company, the Kongsberg group turned over 864 million € in 2010 and operates in 19 countries around the world, including China. It develops, produces and mar-kets a variety of automotive systems.

Products: driveline systems, interior systems, actuation and chassis systems, fluid transfer systems, power products systems for both OEM and aftermar-ket.

In China, Kongsberg has a fully owned company in Wuxi in Jiangsu since 2005 and three more plants around Shanghai.

Among customers in China are Volvo Car and Geely, GM, VW SAIC, Audi, Ford, Renault, Nissan, Mazda

and Nissan Dongfeng.Contact: Joachim Magnusson,

Executive Vice President Driveline Systems, +46382-38475 . [email protected]. www.ka-group.com

LEAXLong established supplier of machined powertrain components for heavy ve-hicles with three plants in Sweden and two in Latvia. Production processes are mainly advanced machine cutting and forging of rotating powertrain components.

Among customers are Scania, the Volvo group including Mack and Renault Trucks, Atlas Copco, Sandvik M & C and supplier companies Arvin Meritor, Dana, Danaher, Haldex, SKF and ZF.

So far, LEAX has no Chinese operations but comes to China to look for contacts and opportunities.

Contact: CEO Roger Berggren, +46-221-346 07. [email protected] www.leax.se

Mobile Climate Control, MCC-HVACThis company specializes in interior climate systems. MCC develops, pro-duces and markets efficient systems for comfortable interior climate conditions in buses and heavy and commercial vehicles. HVAC stands for Heating, Ventilation and Air Condition.

With headquarters and produc-tion in Sweden north of Stockholm, the company also operates in several European countries, North America and Asia.

In China, MCC has one manufac-turing and one trading company, both located in the Nordic Industrial Park

near Ningbo south of Shanghai. Using Chinese suppliers, it counts Dynapac, Cargotec and Ruukki as well as local companies among its customers.

Contact: CEO Clas Gunneberg, +46-176-207 800 or 705-930482. [email protected]. www.mcc-hvac.com

NitatorA qualified supplier of metal compo-nents with high added value. With ad-vanced CAD/CAM and 3-D support,

Nitator produces parts in heavy stamping, laser cutting of sheet metal and tubes, welding and painting.

In China, Nitator has a contracted manufacturing partner in Fine Metal, both for the Chinese market and for exports.

Processes used are stamping, weld-ing and machining of components.

Nitator also has a trading company in Hong Kong.

Contact: CEO Jan-Eric Petersson, +46-35-177 500. [email protected]. www.nitator.se

Plastal Industri ABSpecialist in development, styling, eng-ineering and production of composite front and rear bumpers and other body parts for cars and commercial vehicles. Volvo Car is a major customer.

The company has headquarters and production in Sweden plus production plants in Norway and Belgium.

In China, Plastal has opened a representation office in Shanghai, so far mainly for purchasing of tools for its European plants. But further on, the company also aims at production in

21 qualified suppliersKONSTRUKTIONSBAKELIT AB


Tristone FlowtechThis was formerly the Trelleborg group’s operation for handling fluids and gases in automotive applications. This is done by rubber-extruded and composite tubes, hoses and ducts in complex forms to fit into engine bays.

With 7 factories in 7 countries, the company turns over about 200 million € and employs about 2,000 people. So far, Tristone has no Chinese office or operation but plans to establish one this year.

Contact: Key account manager Johan Bunse, +46-31-650 151. [email protected]. www.tristone.com

Verktygsmekano i Motala ABSubsidiary of Vätterledens Invest AB, a group of business and trading compa-nies with headquarters in Gothenburg.

With its Swedish operations in Motala, Verktygsmekano develops, pro-duces and delivers injection moulding tools to Scandinavian suppliers of plas-tic components to Volvo, Scania and others. The company also offers project management, service and modifica-tions, including mobile service units.

New plastic forming tools are made by contracted partners in China. Since 2002, they have delivered about 1,500 tools to Swedish customers. Verkstads-mekano has its Chinese administrative and technical office in Dongguan.

Contact: MD Lars-Eric Boreström, +46-708-174801. [email protected]. www.viab.se

Project team: Benny Johansson, +46-141-58058, Birger Haglund, +46-141-58057, Stefan Krantz, +46-141-58056. www.verktygsmekano.se

TEGE

China for both Volvo and other vehicle producers.

Contact: CEO Per Ewe Wendel, +46-706-34 67 63. [email protected]. www.plastal.com

Promens HFThis major Icelandic company has 47 factories in 19 countries and 4,200 employees worldwide. It develops and produces injection moulded plastic components for automotive and other purposes. In vehicles, they are used for exteriors, interiors and under the bonnet.

Production processes: blow mould-ing, thermoforming, injection mould-ing, rotation moulding.

Until now, Promens has no Chinese operation but is looking for a Chinese partner.

Contact: Stephan Bauer, +354-580-5550, [email protected]. www.promens.com

Raufoss TechnologyWith its abundant water power resourc-es, Norway has a strong aluminium industry. One obvious example is Rau-foss, a global supplier of lightweight suspension parts for vehicles.

Components in extruded alu-minium are machined and formed by in-line forging or stretch bending cold forming, moulding, stamping, heat treatment and assembly.

Headquartered in Raufoss in Norway, the company is now owned by Neuman Aluminium in Canada. It forms the hub of an industrial park for lightweight metals in its home town. It also has facilities in Boisbriand in Quebec in Canada and in Suszhou in Jiangsu, China.

Contact: Leif Bronken, +47-98 28 19 99. [email protected]. www.raufossneuman.com

RECResident Engineering Co. in Saab’s hometown Trollhättan is a marketing and management consultancy, based in Gothenburg and with the automo-tive industry as one of its pillarstones. It assists in project management, business and process development, and new establishments.

For Nordic automotive suppliers, REC keeps an office in Mainz in Germany and plans to do the same in Shanghai. REC also manages the present visit of Scandinavian suppliers to China.

Contact: Peter Bryntesson, +46-31-27 58 86. [email protected]. www.rec-inter-national.com

Service on composite forming tool


”Plastic compounds for the automotive industry

– developed and

produced in Sweden”

Henrik Eriksson – R&D Manager

Polykemi AB | Box 14, 271 21 Ystad, SWEDEN | Phone: +46(0)411-170 30Telefax: +46(0)411-167 30 | E-mail: [email protected] | www.polykemi.se

More info: www.polykemi.se

Coal is China’s main energy resource. PHOTOS: ERLAND LINDAu

mainly in underdeveloped west-ern regions. To avoid social and political unrest, China must now raise their standard to acceptable levels.TEGE

and reduced poverty. China’s per capita income was 4,300 USD in 2010 - about one tenth of that of rich welfare states.

At least 10 per cent of the Chinese are still genuinely poor,

which could always overturn the best laid plans. That is why China’s government protects its stability so persistently.

However, certain society and business areas will still grow faster, such as infrastructure and transports. But with more focus on the west, around and beyond fast growing mega cities Chengdu and Chongqing.

There will also be more focus on softer values, such as environ-ment, energy saving, life quality

l slower growthl focus on westl private consumption

More private consump-tion, sligthly less economic growth and

more investments in western regions. These are the main aims for China’s new five-year plan, recently passed by the National People’s Congress.

For the coming period, China plans to restrain its annual GDP (Gross Domestic Product) growth from 7.5 to 7 per cent. This may seem marginal and within the limits of statistical miscalcula-tions, but China’s government is arguably alone in the world in actually controlling all relevant economic, political and social factors - except pure chance,

New 5-year plan:

Old habits in rural areas.


Joint venture deals must be watertightOne way of getting a foothold in China is by a joint venture (JV) with a Chinese partner. For vehicle manufacturers, this is still mandatory. For suppliers, it is an option.

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Forming a JV with a Chinese partner has three obvious advantages: it requires less

money than going on your own, it can simplify and speed up for-malities, and it can provide local knowhow and experience without the need for external aid.

But it also brings an inherent risk of conflict if things don’t turn out as planned. In cases of problems, each partner tends to protect his own interest, and the local partner generally has closer and better relations to local authorities.

Even though Chinese laws in letter offer equal terms for both parties in a conflict, local courts are not always fully aware of this and tend to favour the local part.

In fact, several Scandinavian and European companies have had problems with JV partners. Volvo Truck took a step back and presently has no Chinese produc-tion. Kongsberg Automotive has left JV partnerships in favour of fully-owned subsidiaries.

At the 2010 Supplier Forum in Gothenburg, Kongsberg’s vice president Bent Wessel-Aas explic-itly advised his audience to go for fully-owned companies in China rather than JV solutions:

“Problems with JV partners can be very costly and compli-cated, not least if you have to buy them out”, he said and men-tioned the following potential risks:l You could find your partner

competing with you via another company.

l You could find your products copied.

l You could meet dumped competitor prices.-

l You could see over-optimistic cost estimates, overvalued stocks - or stocks taken over below their value..If chosen at all, JV deals

should be thoroughly thought out and formulated to be watertight in all conditions.

TEGEJan Holmberg.

Clas Nyberg.

Kongsberg’s Bent Wessel-Aas speaks for fully-owned subsidiaries.

Advice from lawyers:

find European partners

They claim that suppliers with their own subsid-iaries tend to do better

long term business than those who form joint ventures with Chinese companies or use Chinese agents. Many compa-nies who first formed such JV operations have later gone on their own - often at great costs for buying out their Chinese partners.

To share costs and reduce risks, Nordic suppliers can find a partner among other Nordic colleagues - or even competitors. They can also form alliances between several suppliers by creating jointly owned operations in China./www.mannheimerswartling.se

Going on your own or finding Chinese partners is not the only ways to enter the Chinese market. You can also form alliances with other Scandinavian or foreign partners. This is what qualified legal advisors Jan Holmberg and Clas Nyberg from the Swedish law firm Mannheimer Swartling recommend.


World Class MachiningArkivator Industry manufactures complex products for customers within the automotive and general industry.

The foundation for our business is machining and we take responsibility for the complete value chain.

• Steel, grey iron, aluminium and sheet metal• High and low volume• Small and big components• Prototype manufacturing• Production engineering

We have been located in China since 2008.

Arkivator Equipment (Kunshan) Co., LtdBuilding 3 · No 78 Changyang Road Yushan Town · Kunshan · PR of ChinaTelephone +86 139 1681 4240

Arkivator IndustryGöteborgsvägen 5 · PO Box 743 SE-521 22 Falköping · Sweden Telephone +46 515 72 36 00

www.arkivator.com

The present Volvo can-not satisfy all these demands simultaneously. It would need two parallel model development lines, sharing basic technology and components. This is exactly what its new Chinese connec-tions can offer.

With one R&D department in Sweden and one in China, it can develop models and versions to suit either Western or Chi-nese and Asian markets. The vital issue is selling enough new cars to cover the development and production costs for this, not least hybrid and electric cars for short distance commuting and urban use.

With a new administrative and strategic organisation, Volvo can uphold its sales and market shares on mature markets and create new sales on emerging markets. This would mean continued production in Sweden and Belgium and sales on the 400,000 level in Europe and North America, and rapidly growing new sales towards 300-400,000 in China and other Asian markets.

Volvo Car prepares for plants in ChinaThis year, now Geely-owned Volvo Car aims to sell more than 400,000 new cars, up 7 per cent on 2010. But still, this is more than 50,000 units less than in the record year 2007, when Volvo sold 458,323 new cars.

To regain and pass this level, Volvo will need the extra sales expected from its new

Chinese plant in Chengdu, 1,600 km west of Shanghai. It will be ready for production in 2013. The aim is for 50,000 new cars made there in 2013, 100,000 in 2014 and more in 2015.

This will be an all-new, greenfield factory, probably to be supplemented by one in Daqing in the province of Heilongjiang in Manchuria and probably also one in Jiading in the Shanghai area.

With new models made in China, Volvo plans to increase

its Chinese sales from 30,552 in 2010 to 200,000 in 2015. But it will not be quite the same models or versions made and sold by Volvo today. New models will come, specifically developed for the Chinese market.

Conflicting interestsIn this, Volvo is under conflict-ing interests with several parallel agendas to follow:l finding its own way, as new

CEO Stefan Jacoby has advo-cated

l establishing a position as a European premium brand

l meeting Chinese market

demands for big luxury carsl meeting Chinese owner

demands for smaller, cheaper cars

l offering Chinese officials stately transport

l meeting governmental Chi-nese demands for cleaner and leaner cars.


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Chinese headquartersMinority owner of Volvo Car with 12 per cent is the investment company of Jiading, the district of Greater Shanghai where Volvo will locate its Chinese headquar-ters and most likely also its third production plant.

This will get the same re-sources for developing complete cars as Volvo has in Gothenburg, but its efforts will be directed to the conditions and demands of the Chinese market, and possibly also Asian export markets.

It is all part of the aim of both Li Shufu and Stefan Jacoby to sell 800,000 new Volvo cars per year by 2020. The only way to do this is by producing and selling in China as well. And the only way for Volvo’s Scandinavian suppli-ers to stay on is to go along with Volvo in this.

To assist them, FKG arranges its supplier visit to China. It opens a door not only for par-ticipating companies, but also for other Scandinavian suppliers quick on the uptake.

TEGE

Supplier Forum, this opens new business opportunities for alert Scandinavian suppliers to be present in China either on their own or by alliances.

Fast growing Chengdu is the capital of the province of Sichuan and has more than 7 million inhabitants in its urban area and more than 11 million with sur-rounding towns. Chengdu is old and was called the Brocade City for its textile industries.

Daqing, by contrast, was founded as late as 1959 to house workers of the nearby oil fields. It has grown remarkably fast to its present 2.7 million inhabit-ants and also has important petrochemical industries. As the oil production seems to have reached its peak, Daqing’s au-thorities now see the automotive industry as a replacement.

Via a holding company, Daq-ing’s authorities now own 37 per cent of Volvo Car shares and have an obvious influence on Volvo’s board decisions. There is no sur-prise that Volvo’s second Chinese plant will be in Daqing with cold and snowy winters.

both Geely head Li Shufu and Stefan Jacoby have claimed that Geely will remain Geely, and Volvo Volvo.

Consequently, Volvo will need qualified, reliable technology and quality suppliers in China. As Volvo’s purchasing head Bernt Ejbyfeldt said at the 2010

Suppliers from homeFor this, Volvo will need its Swedish and European suppliers to follow on to China for high tech, high quality supplies to its new Chinese plants. Mother and sister company Geely already has its local suppliers to share for simple, high volume parts. But


Green Sunwin bus in Shanghai.

are, of course, more expensive, but the state offers up to 600,000 RMB subsidies for each new such bus. Pekkari claims that Sunwin is a leader in this field.

He also says the Chinese state invests heavily in railroads and superfast trains. China has 40 per cent of the world’s super trains. Co-ordinated with rapid bus net-works, they are intended to ease the load on roads from growing vehicle traffic.TEGE

the end of 2010, the total length of all Chinese roads was almost 4,000,000 kilometres. Of these, 74,000 km were motorways with ambitious plans for further extension.

They were being used by more than 200 million road-going vehicles. Of these, about 2.5 million are big or mid-sized buses. Of these, close to 7,000 are made by Volvo. No figures for Sunwin or Silver Bus are given, but reasonable estima-tions are that about 30,000 Sunwin and 3,000 Silver buses are rolling on Chinese roads.

Sunwin aims at mid and top level city and commuting buses. It gets its drivelines from Sweden but uses domestic Chinese suppliers for most of its components. Scandinavian sup-pliers are welcome, particularly for more advanced and complex components and systems.

Local sourcing“It is hard for international suppliers to compete for simple, cheap components”, says Lars-Olof Pekkari and says two thirds of the contents of Volvo buses are from local sourcing.

He tells that China con-sciously supports development of new fuels and driveline technologies to become less dependant on imported oil and diesel. China is investing 100 billion RMB (about the same in SEK) to support new technology R&D and a further 15 billion to support operators in buying new, greener and cleaner buses.

Hybrid and electric buses

But Volvo also makes buses in China in cooperation with Chi-nese joint venture partners. With SAIC (Shanghai Automotive Industry Group), Volvo shares the Sunwin Bus Corporation in Pudong, Shanghai. Sunwin produces more than 3,000 new buses per year, mainly city and short distance buses. With Xian Aircraft Corp. in Xian, Volvo shares the Silver Bus Corp., which makes about 300 long distance coaches per year.

Urbanization“In China, the big business is city and commuting buses for fast growing big cities”, says Lars-Olof Pekkari, Director of Business Development at Volvo Bus. Close to half of China’s 1.34 billion inhabitants now live in cities. By 2035, more than two thirds are expected to live in cities.

To meet this domestic migra-tion, China is heavily investing in new roads and railroads. By

Shanghai alone has a fleet of about 25,000 city buses. Of these, some 250 are hybrids

and 120 fully electric. The latter are all from Volvo Bus and were used for Shanghai’s 2010 World Expo.

With its huge population and fast urbanization and economic growth, China invests heavily in its infrastructure, not least bus and railroad transports. China’s new bus sales are about 120,000 per year with a strong growth tendency. There are about 90 bus makers in China, most of them domestic.

By volume, Volvo and its international competitors so far have but a small share of this market. In 2010, Volvo delivered about 600 new buses in China - all imported from Volvo Bus plants in other countries. This represents 6 per cent of Volvo’s global bus production of 10,229 units in 2010, an increase of 4 per cent on 2009.

Fast growing bus marketThe Chinese bus market is driven by heavy state subsi-dies and the need to use less of conventional diesel fuel. While most buses still use conventional drivelines and diesel fuel, major big cities in general and Shanghai in particular open up a market for new powertrain and fuel technologies.

More than 200 million vehiclesIn early 2009, four million kilometres of Chinese roads were used by 170 million road vehicles. Split into categories, they were as follows:l cars (78 million)l motor cycles (90 million)l 3-wheelers (13 million)l tractors (15 million)l light and mid size com-

mercial vehicles (9-10 million)

l heavy commercial vehicles (more than 2 million)

l buses (about 2.5 million)But most of these numbers

grow rapidly. By the end of 2010, there were 78 million cars, up 19.3 per cent on the year before. The total number of road going vehicles was well over 200 million units.

PHOTOS: VOLVO BuS


In 2010, Volvo Construction Equipment (VCE) turned over 53.8 billion SEK, up 51 per cent on 2009. Particu-larly strong was the recovery in Asia, up 88 per cent to 24.4 billion SEK. A driv-ing force was China with its ongoing infrastructure and

housing investments.This opens new business

opportunities for Scandinavian suppliers. On March 29, VCE will receive the Scandinavian supplier group in Pudong in the Shanghai area. Topic of the day: potential supplies to this plant. /TEGE

Dedicated Chinese- but hard to find qualified peopleScandinavian suppliers in China generally are quite satisfied with their Chinese employees. “They have a very positive attitude, want to satisfy our custom-ers and are keen to improve themselves”, says Johan Palmqvist, head of AQ Holmbergs in Suzhou. He also says that many Chinese speak good English.

are low, rentals are high, up to 25,000 RMB per month. Another problem is personal transports. An hour each way to and from work is normal. Most go by car - some with private chauffeurs. Roads are built fast - and con-gested again equally fast.

Traffic is intense and much more accident-prone than in Scandinavia. The authorities are aware of this and trying to

are so anxious to learn and speak English that English tends to take over.

Cultural differencies appear in habits and attitudes. In China, it is normal for managers to have servants. “First, I wanted to do household routines myself and felt awkward having someone else do it for me. But I was told this is seen as depriving Chinese home assistants of their work”, says Joachim Magnusson.

Most Scandinavians working in China are there only for one to two years and often live in rented flats, close to one another. They also go to Scandinavian clubs, play golf and generally socialize together.

A few stay on for longer and have to assimilate more into the Chinese society. But they generally live in flats, too. The vital question is where. “Finding a flast is easy. A good advice is to live close to good schools, if you have children”, says Joachim Magnusson.

English schoolsThere are several good, Eng-lish-speaking schools around Shanghai, as well as shops and service. Health care is not yet up to Scandinavian standards, but improving, according to several interviewees. Tap water is not advisable to drink. Instead, you have fresh water dispensers in your kitchen.

As for private and social life, there are work-related networks. There are more than 100,000 foreigners in the Shanghai area - still only 0.5 per cent of the total population.

While taxes and living costs

The working week is Mon-day-Friday with 40 working hours, eight per day. There

are only eight days of vacation, but China has numerous holidays and festivities which bring total work-free days close to 30, not counting weekends.

Personal taxes are very low. There are consumption taxes up to 17 per cent. The state gets most of its incomes from com-pany profit taxes of 25 per cent.

Of course, there are unions, but they don’t handle wages, which are negotiated individually for everyone. Wages are rapidly rising with competition for quali-fied people, hard to find. Staff turnover is rather fast, and it is hard to keep people.

“We try to counter this by taking care of our staff, not un-like old Swedish and Norwegian mill traditions”, says Gestamp Hardtech’s marketing director Markel Jonsson.

Recruiting needsSeveral Scandinavian suppliers in China need to recruit more staff. “We need to double our present staff of ten”, says Arkivator’s Chi-nese head Mikael Helgewall.

Rationalization and Lean thinking is easy to implement, ac-cording to several Scandinavian suppliers. “They know that we represent heavy investments and are quick to adapt”, says Joachim Magnusson, driveline execu-tive vice president of Kongsberg Automotive.

If problems arise, they are often related to cultural differen-cies or language matters. Even if many Scandinavians in China try to learn Mandarin, the Chinese

PHOTO: AuTOLIV

limit and regulate traffic flows as much as they can.

One cultural and society code to respect is that of saving your face. Another that of informal family and social networks governing decisions and business. “To handle and understand this, we must learn more about Chi-nese culture and history”, says Markel Jonsson.TEGE

Strong recovery


Chairman: Lars-Gustaf Hauptmann,Färåsvägen 14, SE-428 37 Kållered.Tel. +46-31-795 35 21,mob. +46-731-40 25 09.E-mail: [email protected]

Office: Rönnbärsgången 7, SE-436 54 Hovås.Tel +46-31-16 99 85.Fax: +46-31-16 93 75.E-mail: [email protected]: www.sveafordon.com

Cooporative members 2011 in SVEA:Autoliv ,BT Products, Fluent Sweden, Ingemanssons, Müller BBM Scandinavia, RT Labs, Sv Volkswagen, Saab Automo-bil, Scania, Volvo Technology, Volvo Car, Volvo Truck Corp, XDIN AB

Publisher: Svenåke Berglie

NR 1-2011

Information and debate pages for members of SVEA, the Swedish Vehicular Engineering Association, which in turn is a member of the global vehicle engineer association FISITA.

The aim of SVEA is to:

- speak for vehicle engineers in the general debate, informing about advantages and disadvantages of various types of vehicles and means of transport, both nationally and globally,

- create a network for fast distribution of informa-tion on vehicle technology within the profession,

- attract talented youth to continue the heritage of today’s vehicle engineers.

The whole world speaks English. Or at least understands it. Or can get an idea of what it’s all about through English.

Wrong. Simply wrong. Not even one fifth of the world's population speaks or understands English. And when you get into Asia, South America, Africa, i.e. the economically quickly developing areas of the globe, this ratio falls dramatically.

In some parts of the world, such as within the European Union, you are obliged to translate certain

types of documentation. With the rise of the Indian and Chinese economies, there are more and more administra-tive demands for local language. So far so good, you have to follow the law of the land.

But it doesn’t end there – you sim-ply make more money translating, and there’s research to support it!

The biggest independent research institute within the translation/local-

ization segment, Common Sense Advi-sory, did a study on people’s propensity to use and buy from web sites in Eng-lish or their mother tongue language. The figures speak for themselves.

The first and most important con-clusion is that people prefer buying in their own language.

If given a choice between English and their own language, they are three times more likely to use their own lan-guage. And if the purchase they want to make is of importance, as many as 85 per cent think that it’s critical to get

Read it - won’t buy it” in Chinese and other languages.

To translate or not to translateBy Johan Laestadius, CEO, Kommunicera Communications AB


Check list for choosing a translation partner when going into China

information in their home language, and that this definitely influences their buying decision.

The study showed that not only did customers prefer the site itself to be in their local language, but all transac-tions such as payment and support should also follow suite.

The conclusion is that language matters, and that this is true even for consumers who say that they are com-fortable using English.

Now you might say that, well, this might apply to web sites only, we strike bigger deals directly B2B ,and then the language doesn’t matter.

We would like to oppose that and offer an example to show that the most expensive can be the cheapest and that translation wins contracts.

In the bid for a large telecom contract in China, it finally came down to a choice between Nortel and Alcatel-Lucent. In Lucent’s tender, all documentation was in English, whilst Nortel preferred to translate everything into Chinese. Despite Nortel’s proposal being 15 per cent higher, they got the deal.

The most expensive actually be-came the cheapest ,because documen-tation in the domestic language meant that cheaper non-English speaking staff could be employed for mainte-nance and service work etc.

This, in turn, meant that the final cost for the customer was lower with the higher tender.

l Your translation agency must have local presence, either through owned offices or by partners. Quality-conscious translation agencies have a principle always to use translators translating into their mother tongue AND living in the target country. This is especially true for China, due to the rapid ongoing economic and cultural changes.

l Make English the source language, even if it entails relay transla-tion. That way you lower costs and broaden the supplier scope infinitely.

l If possible through your translation agency, get other contacts such as lawyers, marketing people, layout specialists and printers on site in China.

l In the early stages of market introductions, it is vital that your representatives in China feel involved and have their say. Therefore, make sure that your translation agency can handle in-country reviews and that they allow your representatives to have direct contact with the translators.

l Make sure that the agency can use and re-use all of your existing (and future) formats, including dtp, business systems and web. This makes for lower translation overheads and also shorter time-to-market.

l The agency should fully master 2-byte languages and move seamlessly between 1 and 2-byte.

l They should be able to handle e-commerce systems, plug in directly with web services and handle standards like XLIFF.

l If you have a choice, use file formats supporting layout AND linguistic support for the market, e.g. InDesign.

l Always keep the original format so that you can just update the contents, rather than reinventing the layout wheel every time.

l Make sure that your agency uses dedicated specialists for all stages of the project: project managers, translators and layout people respectively.

l Send final documents at the outset of the project. and don’t change them during the course of the project . Remember that China is to the east of us and that we risk losing a working day for each and every little change.

l Set the Graphic Guide lines for Chinese before you start trans-ferring documents into Chinese. Don’t do this job yourself but hire a specialist – why not your translation agency.

l Decide on working fonts, preferably Unicode fonts.

l When you order, order ready-layout documents as deliverables, but don’t forget to also order editable originals.

Double wage costs for bilingual technical expertise.

Posttidning B Port payé Economique BAvsändare/Returadress: Fordons Komponent Gruppen AB,

Bror Nilssons gata 4, SE-417 55 GÖTEBORG, Sweden

Sapa Automotive, Main office, SE-574 81 Vetlanda, Sweden. Tel+4638394100. Fax+4638310185. www.sapaautomotive.com

There is no suchthing as a minordetail.

Not in automotive, anyway.As specialists in the handling and shaping of aluminium extrusions for the automotiveindustry, we are used to finding solutions for most parts of modern cars and trucks.Light, strong and corrosion resistant aluminium can be used for structural parts, powertrain and driveline, interior components as well as trim parts and accessories. As a bonus, you get the environmental advantages. More than 90 % of the aluminiumcontent of cars is recycled, without loss of quality and with just a fraction of the original energy input.

From strong structural parts to components with high surface finish demands; wehave the capacity.

There is no such thing as a minor detail.:Layout 1 11-02-07 16.29 Sida 1

Sapa Automotive, Main office, SE-574 81 Vetlanda, Sweden. Tel+4638394100. Fax+4638310185. www.sapaautomotive.com

There is no suchthing as a minordetail.

Not in automotive, anyway.As specialists in the handling and shaping of aluminium extrusions for the automotiveindustry, we are used to finding solutions for most parts of modern cars and trucks.Light, strong and corrosion resistant aluminium can be used for structural parts, powertrain and driveline, interior components as well as trim parts and accessories. As a bonus, you get the environmental advantages. More than 90 % of the aluminiumcontent of cars is recycled, without loss of quality and with just a fraction of the original energy input.

From strong structural parts to components with high surface finish demands; wehave the capacity.

There is no such thing as a minor detail.:Layout 1 11-02-07 16.29 Sida 1

fkg - fordonskomponentgruppen · fkg - fordonskomponentgruppen translations increase sales. truck....

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