Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

China Automotive Systems, Inc. (CAAS) Garners Long-Term Contract With SAIC-GM-Wuling

|Includes: China Automotive Systems, Inc. (CAAS)

China Automotive Systems is a leading supplier of power steering components and systems to the Chinese automotive industry, operating through ten Sino-foreign joint ventures. The company offers a full range of steering system parts for both passenger and commercial vehicles and has annual production capacity of over 3.8 million sets of steering components.

The company reported today that it has entered into a multi-year agreement to supply the SAIC-GM-Wuling (SGMW) joint venture with its high-quality rack and pinion power steering systems. The SGMW joint venture was formed in 2002 and consists of General Motors and two Chinese firms - Saic Motor Corporation Limited and Liuzhou Wuling Motors Company Limited. GM reported record sales in 2012 at SGMW with 1.4 million vehicles sold, an increase of 12.4% year-on-year.

China Automotive has already begun shipments to the joint venture. The steering units are intended to be mainly installed in SGMW's Wuling Hongguang brand, which is the best-selling multi-purpose vehicle (NYSE:MPV) in China. Based on the current order rate from SGMW, the company's shipments of steering systems could approximate 350,000 units in 2013.

China Automotive also supplies FAW Volkswagen and Dongfeng Peugeot Citroen in the sector with similar components. This is a good sector for China Automotive to be in, especially since it is gaining market share. According to the China Association of Automobile Manufacturers, sales of MPV vehicles soared by 50% to more than 300,000 units just in the first quarter of 2013.

For more information about China Automotive Systems, please visit caasauto.com

Please see disclaimer on the MissionIR website www.missionir.com/disclaimer.html