Chinese safety maker wins FAW contract

SHANGHAI -- East Joy Long Motor Airbag Co., a domestic Chinese maker of safety systems, beat overseas competitors to win an order with FAW Group.

East Joy Long will begin supplying steering wheels, passenger and driver airbags, side airbags and electronic control units to FAW Group in late 2009.

The company has supplied FAW Car Co., maker of FAW's own brand cars Red Flag and Besturn, since 2006. But winning an order with FAW Group opens doors to new avenues. FAW Group has joint ventures with Volkswagen AG and Toyota Motor Corp.

This "new project with FAW Group is a very, very important project," says Bobby Li, vice president of purchasing and sales at East Joy Long. He declined to divulge any details about the deal.

Airbag suppliers such as global safety system manufacturers Autoliv Inc. and TRW Automotive Inc. competed to win the order from FAW Group. With rising material costs, automakers are trying harder to cut costs. For local Chinese suppliers this is an opportunity.

The new order brings new prospects to the company, and Li expects at least a 70 percent increase in sales this year. In 2007 East Joy Long had sales of 200 million yuan ($29 million).

East Joy Long's existing customers include Anhui Jianghuai Automobile Co., Jiangling Motors Corp., Beiqi Foton Motor Co., and Geely Automobile Co.