Eaton to manufacture truck transmissions in China

CLEVELAND, OH.... Eaton Corporation announced today that it has gained Chinese government approval to begin manufacturing heavy-duty truck transmissions in Shanghai for Asia/Pacific markets.

Eaton Truck and Bus Components (Shanghai) Company, Limited (ETB-Shanghai) will be located in a new, 100,000 square foot facility and will manufacture Eaton Fuller 10-, 13- and 18-speed transmissions for original equipment manufacturers in Australia, China, Japan, Korea and other Asia-Pacific countries. Production is expected to begin by early next year and is projected to grow to more than 24,000 units annually by 2008.

Eaton Chairman Stephen R. Hardis said, "This expansion of Eaton's operations in China is the latest of many building blocks in our long-term strategy designed to grow Eaton into a $10 billion company by the year 2000. We are building upon the strengths of this company via new product introductions, increased international expansion and strategic acquisitions."

Formation of ETB-Shanghai is the company's fourth operation in China, and the third announced in the past 16 months. In 1993, Eaton and Jining Hydraulics Company of Jining City, Shandong Province, formed a joint venture to manufacture low-speed, high-torque hydraulic motors, primarily for agricultural and construction equipment. In April, 1996, the company announced a joint venture agreement with the Suzhou Electrical Apparatus Group Company to manufacture and sell electrical circuit protection devices, and in June, 1997, announced a joint venture agreement with Weihai Measuring Tools Factory to manufacture washing machine controls.

Thomas W. O'Boyle, Senior Vice President-Truck Components, said the transmissions to be manufactured will be advanced models that will meet the growing Asia-Pacific demand for quiet, reliable, high performing and cost-effective truck components. O'Boyle said that in addition to serving as a manufacturing base, ETB-Shanghai will become a center for truck components sales and service in China.

"This new facility provides a base from which to serve our customers in this part of the world," O'Boyle said. He also pointed out that the recently announced addition of the Spicer® clutch business to Eaton's market-leading medium- and heavy-duty Eaton® Fuller® transmissions, will permit Eaton to better respond to customers who are demanding systems solutions to their drivetrain needs on a global basis.

"This transaction will directly contribute to our Truck Components growth initiative. Eaton is currently an acknowledged leader worldwide in the design, manufacture, and distribution of truck drivetrain components for medium-duty and heavy-duty commercial trucks. The addition of a wholly-owned facility in China now gives us a strengthened manufacturing and marketing base for the Asia/Pacific region," O'Boyle said. Eaton Fuller 9-speed truck transmissions have been manufactured in China since 1985 under a licensing agreement with China National Heavy Duty Truck Corporation.

The new Eaton facility, which will be located in the Pudong area of Shanghai, will machine, assemble, test and ship transmissions. It will include state-of-the-art flexible machining systems and computer controlled testing, to insure that the products conform to Eaton worldwide truck transmission quality standards. Qualification to the QS-9000 quality standard is expected by the first quarter, 1999.

Eaton Corporation is a global manufacturer of highly engineered products which serve industrial, vehicle, construction, commercial and aerospace markets. Principal products include electrical power distribution and control equipment, truck transmissions and axles, engine components, hydraulic products, ion implanters and a wide variety of controls. Headquartered in Cleveland, the company has 55,000 employees and 155 manufacturing sites in 26 countries around the world. Sales for 1996 were $7 billion.



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