Chairman Jimmy Chu of the Fair Friend Group has announced plans to spend around US$50 million on a new operations headquarter and R&D center in Hangzhou City, mainland China, as part of the group's effort to quickly boost its share of China's machine-tool market. Construction on the facilities, which will occupy 85 hectares of land in Hangchou's Xiaoshan District, is to begin by the end of next year.
Chu said that his group has developed manufacturing sites in Hangzhou's Xiaoshan, Jiangdong, and Xiasha districts, but that the Xiaoshan site is no longer suitable for manufacturing since it stands at an exit of the Hangzhou subway system.
The Xiaoshan site mostly makes lathes and vertical and horizontal machining centers priced from RMB400,000 (US$65,500 at RMB 6.1:US$1) to RMB2.3 million (US$76,600) apiece, with machining centers constituting 70% of total output. The site's annual revenue has been around RMB1.2-1.3 billion (US$196.7-213.1 million) in recent years.
Fair Friend's Xiasha site occupies 303 hectares of land and accommodates two subsidiaries that make forklift trucks and big and midsize CNC lathes. The Jiangdong site stands on 360 hectares of land, 160 hectares of which have been developed to make CNC lathes and pneumatic compressors. The group plans to develop the rest of the land in five years to make other machine tools.
Informed sources report that the Dongfeng Yulon Motor Corp., a subsidiary of Taiwan's Yulon, also plans to build a headquarters complex in Hangzhou. According to company officials, the new complex will not be limited to car-parts manufacturing but will also include space for the dining, cultural/creative, and biotech industries to set up shop.
