Car parts maker shifts focus

Norstar says it will generate 20pc of profits from China market as global players relocate to mainland

Mainland car parts exporter Norstar Founders Group will sell 20 per cent of its output to domestic buyers within three to five years, according to chief executive Zhou Tianbao.

'Coping with the increasingly competitive global automotive market, many international automobile manufacturers and auto parts system integrators have shifted their purchasing and production activities to the mainland in a bid to cut production costs,' Mr Zhou said.

Norstar makes car brake components in Anhui province. Customers in the United States accounted for 48 per cent of Norstar's turnover of 1.7 billion yuan for the year to March, while Canadian buyers took up 29 per cent and European firms 23 per cent.

Vice-president David Dai Wei said that the company did not sell directly to manufacturers but to parts integrators, many of which were setting up shop in China.

Norstar has built a new plant in Beijing to assemble suspension systems and shock absorbers. Trial production will begin within two months.

The company announced its turnover localisation goal after reporting a 67.24 per cent surge in annual net profit to 273.48 million yuan despite rising raw material prices and brutal market conditions for both American and mainland carmakers.