Product category:
Form/co-ordinate, optical and vision instrumentation
News Release from: LK
Edited by the Engineeringtalk Editorial
Team on 04 April 2005
Joint venture gets the measure of
Chinese market
To take further advantage of China's expanding economy and industrial base LK Group has formed a joint venture operation with a division of Shanghai Electric Corp.
To take further advantage of China's expanding economy and industrial base, leading British metrology solutions provider, LK Group, has formed a joint venture operation with a division of Shanghai Electric Corp This will provide LK with a second production facility in addition to its main factory and headquarters at East Midlands Airport
The joint venture will enable LK to expand greatly its already strong presence in China by presenting it with the opportunity to supply the local currency market, which accounts for approximately 80% of the potential.
Called Shanghai-LK, the company is a joint venture between the British manufacturer working with its long-term agent for mainland China, Well Resources, and a division of Shanghai Electric Corp, Shanghai Machine Cutting Tools, in whose plant the LK operation is based.
Looking for a Western company to form a joint venture operation with, Shanghai Electric recognised LK's strength as a high-end metrology company.
The first locally produced CMM with a nominal measuring capacity of 1500 x 1000 x 800mm has already been delivered to Ninghai Yiqun Precision Mould Manufacture Co, which, as its name suggests, is a major mould manufacturer supplying to automotive companies such as Shanghai Volkswagen and Shanghai General Motors.
The other model currently in build at the facility is a layout machine, the first of which has been ordered by Shanxi Automobile Group Co, one of China's growing number of tier 1 automotive suppliers.
China already has a large installed base of UK-manufactured LK machines.
Of these, half are installed in automotive OEMs and large first-tier suppliers, including many CMMs in Shanghai General Motors.
LK's long-established headquarters for the Asia region is situated in Hong Kong.
The company also has a strong presence in other Far Eastern territories, including Japan, Korea, Malaysia, Singapore, Taiwan and Thailand.
Said Charlie Edgington, LK's CEO for world markets except the USA: "Our opportunity is to access the 80% of the market where smaller firms, such as second and third tier automotive subcontractors, prefer to buy locally produced machines, made from locally sourced components, and sold in the local currency".
"Now we can attack that market as well".
"The future looks very encouraging, especially as the Chinese Government's stated aim is for the country to become the largest global manufacturer of vehicles built to Western standards and LK has such strength in that sector".
"We also have an enviable track record in aerospace and it will not be long before that industry in China starts to make a real impact".
"Our sales to other manufacturers, subcontractors and mouldmakers are equally mature, so we anticipate buoyant sales across the board in the coming years".
The impact of Shanghai-LK will be felt outside the Asian market too.
A new family of machines will be built at Shanghai-LK destined for world markets, including the UK, and is expected to be launched mid 2005.
The production unit is designed to meet the needs of Asia for the next several years.
There is no practical limit to the available space for future expansion within Shanghai Machine Cutting Tools' premises.
Shanghai-LK will exhibit at the China International Machine Tool Show, to be held at the Beijing International Exhibition Centre from 11th to 17th April 2005.
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