Global leading auto suppliers and manufacturers agree to open production sites in area

Weichai Group, a leading Chinese heavy-duty truck and components developer, celebrated the groundbreaking of the Weichai International Engine Component Industrial Park in the Weifang Hi-Tech Industrial Development Zone on July 13.

Twenty global leading automotive parts makers, including Germany's Knorr-Bremse and United States' Tyco, have signed agreements to open production sites in the industrial park.

More than 1,300 people including representatives from Weichai's suppliers and local governments attended the ceremony.

The 2,000-hectare industrial park, involving more than 200 billion yuan ($29.08 billion) in investment, is projected to have more than 500 auto components suppliers engaged in sectors such as hydrogen fuel cells, smart products and electronics. The park will support Weichai's internationalization and East China's Weifang city to become a hub for engine production, according to local officials.

Modern plants, research and development centers, apartments for employees and supportive infrastructure facilities will be set up in the park to better serve businesses. The park will also place a high priority on eco-friendliness, said officials.

According to the Weifang city government, the industrial park will have an annual industrial output value of 500 billion yuan. It will attract more than 100 billion yuan worth of investment from Weichai's suppliers, and the annual tax from these businesses is expected to exceed 30 billion yuan.

The local government has decided to provide all types of support to enterprises in terms of land use, taxation, finance and professionals, among others, to promote development in the industrial park.

Johannes Haeussler, sales director of Wieland Group, one of Weichai's suppliers, said Weichai is a company with strong competitiveness in global markets. Wieland expects to establish a closer partnership with Weichai to enjoy a more flexible products supply model, he said.

Tan Xuguang, chairman of Weichai Group, said that as Weifang is the birthplace of Weichai, it has helped the company turn its dream into reality. In return, Weichai will continue to support Weifang's development in the upcoming years.

Tan said the industrial park demonstrates the Weifang government's efforts and determination to continuously upgrade its business environment. It also provides Weichai's management with greater responsibilities in terms of supporting the city's development.

He added that Weichai will further support Shandong's efforts in replacing old economic development drivers with new ones, and seek new growth opportunities in areas such as new energy.

Hui Xin'an, Party secretary of Weifang city, said that all related government departments have to learn from Weichai and further improve their working efficiency to better serve companies in the Weifang Hi-Tech Industrial Development Zone. He hoped companies that agreed to move into Weichai's industrial park are able to accelerate construction so as to launch their operations as quickly as possible.

Weichai Group was originally known as Weifang Diesel Engine Factory when it was established in 1946. It has transformed itself into an international company in recent years, and had an annual sales revenue of 230 billion yuan in 2018.

Statistics from Weichai show that the company has invested more than 15 billion yuan in engine development in the last 10 years. Its engine R&D input accounted for 40 percent of its total R&D expenditure in 2018, compared with 36 percent in 2017 and 32 percent in 2016.

Ten years of continuous input has yielded great returns for the company, resulting in Weichai controlling the core technology in its powertrain development and it being awarded first prize at the 2018 National Science and Technology Progress Awards for its breakthroughs in commercial vehicle powertrain development and applications, according to the company.