August 28, 2009, BAIC (Beijing Automotive Industry Corporation) and Bosch sign the CVT (Continuously Variable Transmission) strategic development contract in Beijing Hotel. The leaders from the Ministry of the Nation and Beijing Municipal Government attended the contract signing ceremony.

The leader of the Ministry of Nation said in his speech that with the rapid development of Chinese economy, the government would accelerate the adjustment on the structure of China’s automotive industry and strengthen our competitiveness in auto industry, according to the policy and guideline of the automotive industry development that China had defined. He also pointed out that the CVT development project between BAIC and Bosch would greatly boost R&D intensity on the key auto parts such as powertrain, and provide strong support for BAIC self-owned brand vehicles.

The leader of Beijing Municipal Government introduced the automotive production and marketing in Beijing for the guests. He also emphasized the significance of this development project between BAIC and Bosch, which would enhance the core competitiveness of Beijing automotive industry, and promote a stable and rapid development of Beijing automotive industry in its new era. He also sincerely expressed his hope that this development project would be a wonderful opportunity for the two companies to strengthen their business relationship, thus promoting the rapid and stable development of Beijing automotive industry.

During the ceremony, Mr. Ma Tongli, Vice President of BAIC and General Manager of its Powertain Company and Dr. Detlef Classe signed their names on the contract.

With a history of over 50 years, BAIC is one of the most important birthplaces of Chinese automotive industry, and has made historic contribution for the development of China’s economy and national defense. In recent years, BAIC has kept a strong development momentum and rounded off its complete range of passenger cars, SUV and commercial vehicles. It maintains a growth rate above the industrial average and takes the first place in terms of economic index among Beijing state-owned enterprises. It is expected that BAIC will produce and sell over 1 million vehicles in this year, to be the first enterprise with a capital of over 100 billion CNY in Beijing, and become one of the first-tier domestic automotive groups and an important industrial pillar of the capital. BAIC works actively to promote its group strategy, attaches great importance to the construction of industry chain and puts the powertrain development in the prominent position in its strategy. On August 6, 2009, BAIC officially set up a powertrain company, centralizing the plan, operation and management of its powertrain businesses for the self-owned brand vehicles, which ensures the independent development of BAIC and cultivation of national brands.

The Bosch Group was set up in 1886, and comprises Robert Bosch GmbH and its more than 300 subsidiaries and regional companies in over 60 countries. Bosch founded its first trading office in China as early as 1909. In 1926, the first car service workshop opened in Shanghai. Today, all Bosch business sectors are present in China: Automotive Technology, Industrial Technology and Consumer Goods and Building Technology. As the inventor of CVT push-belt technology, Bosch has over 30 years of CVT experience. Currently over 70 different car models are available with CVT push belt technology. Today an accumulated volume of over 13 million cars, with various power trains such as gasoline, diesel and hybrid drives are driving around with CVT push belt technology. Bosch is committed to the joint development on CVT technology with local partners worldwide through know-how transfer and engineering support.

The CVT for medium and high class cars that BAIC invests in and Bosch co-develops, is incorporated with Bosch’s concept of energy saving and emission reduction. It will be applied in the self-owned brand passenger vehicles of BAIC in the future. Differently from conventional automatic transmission, CVT has un-fixed gear ratios allowing the engine to run at its most efficient RPM resulting in improved fuel efficiency. Some cars equipped with this technology in the Japanese market can offer a 3 – 14% improved fuel efficiency than the same models with a manual transmission. Because of its step less or continuous variable principle, CVT offers drivers 100% smoothness. The CVT which will use Bosch’s advanced and mature development technology and state-of-the-art push-belts technology, can transfer high torques and provide a better fuel economy with a smaller packaging (size and weight) compared with conventional automatic transmissions.

With the application of new technologies, the cooperation on CVT development for the Chinese market between BAIC and Bosch will bring tangible benefits for the Chinese consumers considering the energy saving and emission reduction without compromising on comfort and fun-to-drive. CVT fuel savings can contribute to achieve the goals of energy saving of China’s 11th Five Year Plan. It gives the necessary significance to this project for the development of China CVT technology and market.

The cooperation project is an important strategic project of BAIC after China released its Automotive Industry Readjustment and Revitalization Plan. The project agreement marks another step that BAIC has made towards its independent R&D.

Additional information can be accessed at www.bosch.com.cn