Leading automotive supplier Kautex Textron GmbH & Co. KG will be making plastic fuel tanks in China that can meet emission standards in California.
The company broke ground on a new plant in Wuhan, Hubei province, on Oct. 28, according to state-run local media Changjiang Daily.
It is Kautex's fifth manufacturing plant in China, adding to existing production sites in Shanghai, Guangzhou, Changchun and Chongqing.
The report quoted Kautex President and CEO Vincent Perez saying that the plant will be equipped with state-of-art technology that can produce gas tanks with fuel evaporative emissions as low as 0.3 grams of hydrocarbons per vehicle per day. That would meet emission standards in California, the report said.
With an initial investment of 100 million yuan ($15.7 million), the project will start with 3,800 square meters of manufacturing space, with plans to expand to 7,500 square meters, the report said. Production is slated to begin in 2017, mainly supplying nearby car assembly plants in Wuhan, Xiangyang, Changsha and Zhengzhou.
When it reaches full production, the plant is expected to reach 500 million yuan ($78.7 million) of annual output, the report said.
Preze, along with Kautex Executive Vice President of Global Operations Eric Cardinali and President Asia Wayen Shen, also met with local officials on that day, according to a statement from the Hannan District government.
Wuhan is a booming automotive hub with annual automotive (including suppliers) industrial output of 200 billion yuan ($31.5 billion) and 1.1 million assembled cars, the government said.
In 2014, Bonn, Germany-based Kautex reported sales of $1.98 billion, 13 percent of which came from Asia.
Kautex entered the automotive industry in 1964 when it built the first prototype of a plastic fuel tank for Ford Co.
Its parent company, Textron Inc., is based in Providence, R.I.
