HERZOGENAURACH, Germany – Schaeffler and CITIC Pacific Special Steel (CPS) signed a strategic partnership agreement here to strengthen their business relationship both economically and technologically, according to a news release by Schaeffler on March 31.
The Chinese CITIC Pacific Special Steel Group is China’s largest manufacturer of special steel. CPS has been a Schaeffler supplier for 13 years. The company primarily supplies the Chinese market, including the 13 Schaeffler production plants in China and the Asia Pacific region, as well as locations in the U.S. and Europe. In addition, CPS supplies more than 50 Schaeffler suppliers with increasing annual growth rates.
Schaeffler is one of the largest globally active automotive and industrial suppliers of precision components and systems for engines, transmissions, chassis applications, and rolling and plain bearing solutions. Since 2012, Schaeffler has increased the quantity of special steels it purchases from CPS by an average of 13 percent year after year to approximately 140,000 tons. Growth rates are also expected to be around 10 percent during the next few years.
The Schaeffler Group is planning a new production location in Xiangtan, China as expansion at the existing locations has reached its limits. Initial operation of the plant that will produce automobile parts and precision bearings is planned for the end of 2018.
“In view of Schaeffler’s future development and global course for growth, it is important that we not only strengthen the business relationship with our long-standing partner, but also extend it along the entire value added and supply chain in a sustainable manner,” said Oliver Jung, chief operating officer of Schaeffler AG.
CPS management would like to increase sales in overseas markets such as Korea, Japan, the U.S., Southeast Asia and the EU. CPS excels with its well-established chain of production plants strategically located on the Yangtze River and the latest manufacturing technology. In conjunction with Schaeffler, CPS is hoping to develop innovative materials and continuously optimize its manufacturing and logistics costs for rolling bearing steels. Improved risk control is also one of the objectives of the strategic partnership. CPS CEO Qian Gang and Oliver Jung say the strategic partnership is a win-win situation.