Business Activities News
- Weichai Power eyes Delphi Corp. assets
Date: 15-Dec-2006 Sources: (Shenzhen Daily)
DOMESTIC diesel engine maker Weichai Power Co. is interested in buying assets of bankrupt U.S. auto parts maker Delphi Corp., Weichai's executive director said Thursday.
'We are interested in Delphi's assets as their technologies are the best in the industry,'Xu Xinyu said. 'We might have some cross-border acquisitions next year.'
A deal would give Weichai a foothold in North America, a market many domestic automakers and parts suppliers have been eyeing.
But any move by Weichai Power to acquire Delphi Corp.'s component business could spur opposition from U.S. labor unions and politicians fearful of more job losses and the transfer of technologies to China, analysts say.
In an effort to slash costs and emerge from bankruptcy protection, Delphi, a former General Motors unit, said earlier this year that it aimed to sell or close by the end of 2007 non-core product lines.
Delphi said these could include brake and chassis systems, cockpits and instrument panels, door modules and latches, and steering and wheel bearings.
Xu did not say which assets his company is particularly interested in.
Hong Kong-listed Weichai, which competes with companies like Cummins Inc. to supply engines to the world's second-largest auto market, had in September announced a plan to also list on the Shenzhen Stock Exchange, after privatizing its unit Torch Automobile Group Co.
The move, subject to regulatory approval, would expand Weichai's portfolio into the vehicle business, as Torch owns 51 percent of Shaanxi Heavy-Duty Motor Co., one of the five largest heavy-duty truck makers in China.
Xu said Weichai had recently been in discussions with industry giants such as Volvo AB, MAN AG and Caterpillar Inc. about possible opportunities to cooperate.
'If we talked with each other a year ago, the opportunity available was on the engine side. But now Weichai can offer a whole lot more that covers the overall auto industry.'
Other domestic firms eyeing Delphi's assets include Wanxiang, the country's largest auto parts maker and one of its most acquisitive companies.
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