ChineseBusinessworld.com > Technical Transformation of Car Valves

Technical Transformation of Car Valves

 

Project name
Technical transformation of car valves

Project unit
Shandong Penglai Power Machinery Factory

General survey of the project unit
Set up in 1958, this factory is a state-run enterprise. There are 700 workers and staff members including 60 technicians.

The main equipments are about 300 sets with the fixed assets of RMB 20 million yuan. It covers an area of 60,000 sqm with a building area of 28,000 sqm. The output value in 1995 was RMB 25 million yuan with the profit of RMB 1.5 million yuan.

This factory has manufactured the engine valves for more than 30 years. It has over 40 type and 80 specifications and the annual output is 3 million pcs. It is the largest valve production enterprise in Shandong Province.

Reasons for setting up this project
In the recent few years, car industry is the major industry of the national economy. The eighth-five-year plan is the important period for the development of automobile in China.

The valves for PEUGULT brand car is the typical product of this project. The manufacturing technology and the function are all reached the modern international standard.

Market forecasting
Valves are the key damagable fittings of the internal-combustion engine. Automobile industry, as the key industry to develop in China, will need more and more valves in the near future. By the end of the ninth-five-year-plan, the car production capacity will be 1.5 million sets a year and the needed valves will be 20 million pcs, the production capacity of other type of automobiles will be 1.5 million sets a year and the needed valves will be 12 million pcs, the production capacity of motorcar will be 5.12 million sets and the needed valves will be 20.48 pcs. From above we see that the total needed quantity of valves will be 52.48 million pcs. Other more the other documents said that the needed valves for repairing usage will be 85.14 by the end of this century.

There are 26 factories producing valves in China, among them, there are only 8 factories whose annual production capacity is over 3 million pcs, the others are bellow 2 million pcs.

After the eighth-five-year-plan finished, the total valve production capacity may be 50 million pcs.

Supply of raw materials and power
The annual needed steel is 1200 ton which will be supplied well in China and the power can be supplied well locally.

Investment
The total investment is RMB 80 million yuan. Among them RMB 10 million yuan is for constructing 12,000 sqm of factory buildings, RMB 50 million yuan for equipment, RMB 1.5 million yuan for environmental protection, RMB 2.5 million yuan for others, RMB 8 million yuan for preparation.

The foreign investment amount will be USD 5 million.

Economic profit
After the project finished, the added production capacity will be 5 million pcs with the output value of RMB 112.5 million yuan and profit of RMB 22.5 million yuan. The investment recovering period is 3.6 years.

Cooperation form
Joint venture, cooperative venture or other cooperation forms.