Georgsmarienhutte Holding GmbH (GMH), one of the leading engineering steel producers in Europe, is betting on the outstanding quality of its products to spur its growth in China, the world's major fastest-growing economy.

"The Chinese market, with its fast-expanding manufacturing sector, represents strategic significance for us," said Hartmut Heine, GMH's chief representative and general manager in China.

Having established its presence in China since the 1980s, GMH now has 8,000 employees in the nation. It has enjoyed brisk growth over the years, as demand for its high-quality products have stayed strong, thanks to the nation's robust economic growth.

In 2005, GMH's business in China increased by 20 per cent, scoring 60 million euros (US$763 million) in sales. The company is expecting to achieve "at least" similar growth in 2006.

The German-based company now has 12 business units since restructuring in 2003. It now supplies both individual solutions and complete systems for areas such as raw materials recycling, steel production, steel processing, railway wheels and axles.

During its long presence in China, the GMH Group and its subsidiaries have established an extensive network of local customers, not only foreign joint ventures but also local enterprises.

Groditz GmbH, a manufacturer of forged products and electric steel, has been supplying components to Chinese energy industry for over dozens of of years. Georgsmarienhutte GmbH, the nucleus of the Group, has been supplying various steel alloys to the Minmetals Group, China's largest metal importer.

Currently, GMH supplies more than 10,000 tons of steel each year to customers in Shanghai and North China. It also supplies key components used in all types of engines, with a number of China's major automakers being its customers, including Volkswagen, FAW Group Co and others.

"We will strive to promote all our business lines in China in the coming years, as China's demand for high-quality steel products will remain strong," said Heine.

China's economy has been growing at a speed of more than nine per cent over the past decade. In the meantime, the nation has evolved into a major manufacturing hub in the world, fuelling demand for steel products ranging from auto parts to railway wheels.

The Chinese Government intends to invest heftily in infrastructure such as railway links and power plants in the coming years. Meanwhile, the nation's manufacturing sector is also trying to move up the value chain, shifting from basic assembling to products with higher added value.

GMH is hoping to tap into great opportunities in the process as its products have been adopted in a wide range of industries in China, including the power equipment, shipbuilding, and railway equipment sectors.

Windhoff, a subsidiary of GMH, clinched a 2-million-euro (US$2.57 million) deal with Beijing Subway Construction Management Company, to offer machinery maintenance equipment for subway lines No 5 and No 10 in the capital city. Windhoff will deliver the equipment this year so as to prepare for the completion of the projects in 2008.

Windhoff is active in the design and engineering field of machines and plants.

For decades, Windhoff has been concentrating on particular products for special segments of the market.

Its production and sales today include a variety of technologically accurate and reliable products for railway vehicles, railway workshop equipment and handling systems. Windhoff was also a major equipment supplier for the metro project in Nanjing, Tianjn and Shenzhen, and it is now bidding for metro projects in Guangzhou and Dalian.

"One of the key strengths for GMH is that we provide individual products for the whole system, which guarantee the reliability of our products," said Heine.

According to Heine, the Tianjin Light Rail, which was put into use in early 2005, has been operating smoothly - without even a single hitch thanks to the GMH products it adopted.

"Our sales in China will continue to grow in the coming years, given the fast growth in China's economy and the ever-increasing trade between China and Germany," said Heine

Germany is now China's biggest trading partner in Europe. The bilateral trade volume in 2005 reached US$63.2 billion, accounting for nearly one-third of the trade volume between China and the European Union.

(China Daily 09/13/2006 page19)