Fair Friend Broke Ground to Construct a Plant in The Zaez in Henan Province

The machine-tool manufacturer, Fair Friend Enterprise Group, broke ground on Oct.18 to construct a plant in the Zhengzhou Airport Economic Experimental Zone (ZAEZ) in Henan Province, China as part of its goal to lead the global machine-tool sector by 2020 with estimated revenue of US$8.3 billion.

According to the zone's administration, the ZAEZ occupies 415 sq.km. to be China's first national-class airport economic experimental zone, strategically positioned as an international logistics center for air-logistics, high-end manufacturing and service industries.

Tenants of the zone's air-logistics district are Russian Airlines (AEROFLOT), China Southern Airlines, Hong Kong Dragon Airlines, S.F. Express, United Parcel Service (UPS), and TNT Holding B.V.

ZAEZ targets attracting manufacturers of aircraft products, biomedical equipment, and smart devices. The Foxconn Technology Group became a tenant in 2010 with plans to invest US$5 billion initially to produce 100 million iPhones and Foxconn-branded smartphones combined a year.

According to the administration,16 brand-name suppliers of smartphones have had products made in ZAEZ since 2010, including Apple Inc., the Coolpad Group, Beijing Tianyu Communication Equipment Co., Ltd. and ZTE Corp., with the zone's output totaling 96.4 million systems in 2013 and projected to reach 150 million systems by 2015, to constitute one-eighth of the smartphones built worldwide.

E-commerce operator Alibaba, Microsoft, and Cheng Uei Precision Industry Co., Ltd. have decided to set up operation in ZAEZ, with Cheng Uei having reportedly signed an agreement with the administration to set aside 20 square meters for production of parts for 200 million smartphones yearly with investment of RMB70 billion (US$11.4 billion).

Fair Friend is the first machine-tool maker to move into the ZAEZ, with plans to use 3,000 acres backed by subcontractors and construction scheduled to be completes sometime in the first half of 2016.

Chairman, Jimmy Chu, estimates corporate operations in China to generate revenue in excess of NT$18 billion (US$600 million) in 2014, up from 2013's NT$14 billion (US$466 million), partly thanks to recent partnership agreements with nine enterprises in Zhengzhou, including the Zhengzhou Nissan Automobile Co., Ltd.

Planning to acquire a German, South Korean and two mainland Chinese machine-tool makers by the end of this year, Chu projects its machine-tool business to generate revenue of approximately NT$55 billion (US$1.8 billion) next year, up from 2014's estimated NT$40 billion (US$1.3 billion).