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The global auto parts giant Valeo Group of France is preparing to make a big show in China. Earlier this month, Valeo set up a new R&D center in Shenzhen, becoming the latest case of its localization strategy. In the past year, Valeo achieved a turnover of 9.6 billion yuan in China. By 2015, Valeo hopes to double it again. To this end, Valeo will expand its investment of 600 million to 800 million US dollars. In addition to setting up a local R&D center, the money will be used to expand new plants. “For me, the main task at present is to promote the expansion of Valeo in the Chinese market,†said Jacques Aschenbroich, CEO of Valeo Group. Localization On April 1, Valeo's electronic research and development center in Shenzhen was officially put into use. The center has an investment of 18 million yuan and covers an area of ​​1,200 square meters. It has three laboratories. It is estimated that by the end of the year, 105 engineers will join the center, and only one of them will be a foreign engineer. The hiring of local engineers is an important part of Valeo's localization strategy, which is considered to be closer to local car manufacturers and consumers. The R&D center in Shenzhen will focus on the development of electronic hardware devices, as well as the development of electronic components for electric vehicles. This year, Valeo also plans to set up a new R&D center in Shanghai, which will focus on the power system business. Aschenbroich said that in addition to providing products that are consistent with the world's major markets, R&D in China will develop specific products that are relevant to the Chinese market and consumers. In addition to the addition of research and development centers, Valeo has also accelerated the investment and construction of new plants. On the day of the establishment of the new R&D center in Shenzhen, Valeo announced the completion of its expansion project in Shenzhen. Valeo produces switches, control panels, top modules and more. In line with this, the Changan Peugeot Citroen project has been confirmed to be settled in Shenzhen and will be put into operation in 2012. At present, most of Valeo's business in China comes from international OEMs. Each year, they supply a variety of automotive components to major customers such as Audi, Ford, Peugeot Citroen and Chery. Next, Valeo hopes to increase the share of local OEMs in their overall business. By 2015, Valeo hopes that 30% of its sales in China will come from local manufacturers. Aschenbroich said that Chinese local manufacturers are becoming more aware of the high added value and high quality of their products. They also hope that suppliers can provide products that meet their needs. Therefore, with the continuous development of local manufacturers, "they absolutely need suppliers like Valeo." In fact, the factory in Shenzhen has already provided support for BYD, a car manufacturer in Shenzhen. The future business of the newly established R&D center will also involve the field of electric vehicles, which is the important business that BYD has become famous for. “We came to China because we know that China has a very good development potential,†Aschenbroich said. “For me, the most important task at present is to promote the expansion of the Chinese market.†Valeo, 1994 When I came to China, I now have 18 production bases and 3 R&D centers with nearly 8,000 employees. In 2010, Valeo achieved a turnover of 9.6 billion yuan in China. In the same year, Valeo's global sales were 9.6 billion euros (about 86 billion yuan). In 2010, Asian markets, including China, accounted for 19% of Valeo's global sales. However, Valeo is not satisfied with its current achievements in China, they have developed a more ambitious plan. Based on 2010, Valeo hopes to double its sales in China by 2015. To double this, in addition to the new R & D center and expansion of the factory, Valeo is recruiting employees on a large scale. Of the 27 countries in the world where Valeo is involved, China is the country with the second largest number of employees. By 2015, the number of employees in China is expected to reach the top. By then, sales in the Chinese market will reach second place worldwide. At present, 60% of Valeo's business is concentrated in the European and African markets, and the Asian market including China accounts for 19%. It is estimated that by 2015, Valeo's sales in Asia will account for 30% of its global sales. Valeo clearly knows that this large-scale growth will mainly come from the Chinese market. "For Valeo, China is not called 'emerging markets,' but a market that has risen in development," Aschenbroich said. A year ago, Valeo set up a special team to investigate the development of China's auto parts market. The specific content of this survey is still not known to outsiders, but it can be seen from the actions of Valeo. Valeo predicts that the market size of Chinese local manufacturers will continue to expand, and this is the opportunity of Valeo. However, Valeo also found that Chinese customers and consumers are “increasingly smarterâ€. “They will also observe and investigate what technology is used by component suppliers to select suppliers.†This has, to a certain extent, prompted Valeo to strengthen its R&D capabilities in China in a targeted manner. At Valeo, approximately 5.6% of the turnover will be spent annually for research and development. At present, Valeo does not give a specific amount of R&D investment in China. However, it promises that in the next few years, the investment dedicated to R&D in the Chinese market will account for about 30% of global R&D investment. This is in line with Valeo's sales expectations for Asian markets including China. Perhaps, a survey of the Chinese market a year ago made Valeo very impressive. In 2008, when the “financial crisis†broke out, the Valeo Group lost 207 million euros. In the following year, Valeo quickly turned around and continued to raise its profit target in 2010. Among them, the rapid development of Asian markets such as China has set its sights. In Valeo's plan, in order to achieve long-term rapid development, it is necessary to achieve mergers and acquisitions in Asian regions such as China. At the end of 2009 and the beginning of 2010, Valeo acquired an auto parts company of Changchun and Nissan in China through capital increase and shareholding. But the high cost of acquisitions has made Valeo more focused on reinvesting its existing base. The establishment of a new R&D center and expansion of the factory in Shenzhen is an important part of it. Sitting in the conference room of the Shenzhen factory, on a propaganda board behind As-chenbroich, the logo of Valeo's green trademark was inserted in the place marked with the words of Shenzhen. Covered by green, it is a Chinese map of a whole rooster. Aschenbroich said: "For Valeo, the most important thing now (especially in the Chinese market) is to ensure that development can be smoother."