TOKYO -- Asahi Tec Corp. plans to step up its China aluminum-wheel business considerably after its purchase of U.S. supplier Metaldyne Corp.
The Japanese supplier expects to close on its purchase of Metaldyne by year end.
Asahi Tec's subsidiary in China, Dicastal Asahi Aluminium Co., makes and sells aluminum wheels to carmakers in China and exports to Japan.
Those exports "will be expanded dramatically" next year, says Shoichiro Irimajiri, Asahi Tec's chairman.
Exports from China to Japan will come to less than $5 million this fiscal year. That will jump to between $30 million and $50 million in the next fiscal year, Irimajiri predicts.
The parts are sold to a variety of customers in Japan, he says.
In contrast, at Metaldyne, CEO Tim Leuliette says, "We ship more from the United States to China than China to the U.S."
Asia, especially China and Southeast Asia, will be the enlarged Asahi Tec's top growth priority, says Irimajiri.
Asahi Tec has been strong as a supplier to Japan's truckmakers, as well as to Japanese construction-equipment companies. Asahi Tec now supplies components to Guangzhou Honda and Guangzhou Toyota in China.
Metaldyne, of Plymouth, Mich., is still lining up customers in China. Its customer list will include Shanghai Automotive Industry Corp. for transmission components, as well as Hyundai Motor Co. and DaimlerChrysler AG.
"We have a China facility that we planned to fill over 24 or 36 months," says Leuliette. "Maybe they can help us fill it sooner."
Asahi Tec plans to buy Metaldyne for about $1.2 billion, including the refinancing of Metaldyne's debt.
Metaldyne makes suspensions, ball joints, and engine and transmission and transfer-case parts for light vehicles.
Asahi Tec, a publicly traded company less than half Metaldyne's size, is a supplier to light vehicles and medium- and heavy-duty trucks. Asahi makes aluminum wheels and engine parts and cast ductile iron truck suspension parts.
After the takeover, the new company's revenues will approximately break down to $1.3 billion to $1.4 billion in North America; $800 million in Asia, including $60 million to $70 million in Thailand; and $400 million in Europe.
Asahi Tec has a 25 percent stake in Dicastal Asahi; Wheelhorse Aluminium Casting Co., of Guangdong province, a 55 percent share; and Dicastal Wheel Manufacturing Co., of north China's Hebei province, a 20 percent stake.
You may e-mail James B. Treece at [email protected]