Three of the six new plants that automotive molder Plastic Omnium SA plans this year will be in China, part of a broader push it's making in Asia, where it will locate 12 of the 20 new facilities in its near-term investment plans.
The Levallois, France-based company said Feb. 25 that 2014 sales in its automotive division rose 4.9 percent to 4.88 billion euros ($5.93 billion), with profit up 8.6 percent to 401.7 million euros ($488.2 million).
While European auto sales revenue grew 7.4 percent, and it said performance in the United Kingdom and Germany was “excellent,” much of its capital investment is targeting Asia, where it projects China's vehicle market to grow 7.1 percent in 2015 to 23.2 million units.
“The market is once again driven by China,” said Chief Operating Officer Jean-Michel Szczerba, in a presentation to analysts. “China will account for 1.6 million additional cars, 80 percent of the year's growth. We're expecting subdued growth in Western Europe and North America.”
The company said it grew in 2014 in all major markets, including Western Europe, which is 43 percent of sales and North America, which is 26 percent, and beat the market growth in all regions except North America.
Asia was only 17 percent of Omnium's global sales, but that's where it is growing fastest.
In 2015, Szczerba said the company will open bumper manufacturing plants in the Chinese cities of Wuhan, for General Motors joint ventures, and in Changsha, for VW and Fiat joint ventures, and a fuel systems plant in Beijing for a local car maker.
It will also open two plants in the United States, in Tennessee and Kansas, this year, and one in St. Petersburg, Russia.
It said Chinese vehicle sales rose 9.4 percent in 2014, while Plastic Omnium's sales in the country rose 23 percent, to 430 million ($522.6 million) euros. It opened four new plants in the country last year.
It said 58 of its 102 automotive product launches globally came in Asia last year. Worldwide, the company said it is targeting growth in the 2014-2018 period of double the auto industry's anticipated 3 percent annual growth.
“This growth will be driven by the installation of new production capacities, particularly in China and North America, and new product lines… boosted by new laws worldwide increasingly favoring innovative products to reduce weight and control pollution,” the company said.
The company said it was on target to hit 7 billion euros in annual sales in 2018, including business in its much smaller environmental products division.