A high-speed train departs Tianjin station. SKF Group announced on Tuesday that it had won a bearing contract worth about 110 million yuan ($17 million) with the Ministry of Railways. [Photo / Bloomberg]
Bearing giant aims to "strengthen manufacturing footprint in Asia"DALIAN - SKF Group, the world's top bearing maker by revenue, announced on Tuesday it will build a new factory in Jinan, capital of Shandong province, in a bid to support the growing demand from customers in China and elsewhere in Asia.
"This new investment will support the rapid growth of SKF's business in China and is part of SKF's strategy to strengthen its manufacturing footprint in Asia," said Tom Johnstone, president and chief executive officer of SKF Group.
The total investment amounts to around Swedish kronor (SEK) 590 million ($93 million), and the factory is expected to be fully operational by the first half of 2012, Johnstone said.
The factory will mainly manufacture bearings for the automotive and truck makers, and it will also serve the industrial markets and the vehicle aftermarket, he added.
The company also announced on Tuesday that it had won a bearing contract worth about 110 million yuan ($17 million) with the Ministry of Railways for China's freight wagons.The contract will be completed in April this year, according to the company.
"Currently, a growing number of manufacturers are moving to China's western areas, which means there is a high demand for not only passenger trains but also freight wagons to distribute the finished products," Rakesh Makhija, president of SKF Asia, told China Daily.
"We see a very positive trend in China's railway industry. And a better rail network can improve logistics and have a strong effect on related costs and lead time," he said.
The company is also getting involved with China's booming wind energy industry.
In late February, SKF won a deal worth SEK 500 million with Goldwind Science & Technology Co, one of the leading turbine manufacturers in China. Goldwind's new 2.5 megawatt (mW) direct drive turbine will be equipped with SKF Nautilus bearings as the main shaft arrangement.
"This is our biggest-ever order in the wind energy industry. We are very pleased to sign this contract because the wind-energy industry is a growing sector in China and also a very important market for us," said Makhija.
In 2010, SKF generated 7.3 billion yuan in sales in China, up 35 percent from the previous year, accounting for nearly 13 percent of the company's total sales revenue, according to Erik Nelander, president of SKF China.
"Over the past 15 years, our sales increased at an average annual growth rate of 30 percent in the Chinese market," said Nelander. He said innovation and efficiency are always the goals of SKF, especially during China's transition to sustainable development.
"With increasing production going to the Chinese market, SKF will provide customers with more innovative and efficient products and services help China to upgrade its industries," he added.>
