China Automotive Systems, Inc. (NASDAQ: CAAS) is a Chinese-based power steering components and system supplier. Shares jumped 42.06% on Wednesday, December 19, 2018. Over the past three months, China Automotive has seen an average daily volume of 28,510 shares. However, on Wednesday, 546,220 shares traded hands, equating to $1.66 million in dollar volume.
Shares surged Wednesday after China Automotive announced it has initiated a development program for a recirculating-ball steering (RCB) system in conjunction with Chrysler’s (NYSE: FCAU) Autonomous Vehicle product development. The development program, known as the i-RCB Program, began in the Fall of 2018 and is currently in the Design Verification (DV) test phase. Mass production of the steering system is expected to begin in August 2019 with projected annual sales of about 45,000 units. China Automotive is also looking to take advantage of other market opportunities for their new product, including the Chinese domestic heavy-duty truck market. Mr. Qizhou Wu, CEO of China Automotive, commented, “Our nearly ten-year track record with Chrysler anchored us to be the trusted supplier choice for their promising new product in a key secular market trend. Domestically, we are having serious discussions with a few large OEMs in the commercial vehicle sector.” Here is the full press release detailing the i-RCB Program:
China Automotive Systems, Inc. Press Release:
WUHAN, China, Dec. 19, 2018 /PRNewswire/ — China Automotive Systems, Inc. (CAAS) (“CAAS” or the “Company”), a leading power steering components and systems supplier in China, today announced it has begun a development program for a new recirculating-ball steering (“RCB”) steering system (“i-RCB Program”) in tandem with Chrysler’s Autonomous Vehicle product development.
Started in the fall of 2018, the i-RCB Program is currently in the Design Verification (“DV”) test phase. The Company expects to begin mass production in August 2019 with annual sales of approximately 45,000 units. In addition to orders from Chrysler North America, the technology of i-RCB has significant other market opportunities in the Chinese domestic heavy-duty truck market.
Intelligent hybrid power steering combines traditional RCB with electric power steering (“EPS”) to monitor or control basic functions such as steering speed, active returning, independent steering, and emergency steering. In addition, intelligent hybrid power steering provides extended functions such as lane monitoring with departure warning and crosswind compensation.
Mr. Qizhou Wu, Chief Executive Officer of CAAS, commented, “Autonomous driving is already on the product roadmap of many US and Chinese auto makers. Steering is a critical component in the autonomous driving ecosystem as on-road execution is crucial for safety measures. Our nearly ten-year track record with Chrysler anchored us to be the trusted supplier choice for their promising new product in a key secular market trend. Domestically, we are having serious discussions with a few large OEMs in the commercial vehicle sector.”
About China Automotive Systems, Inc.
Based in Hubei Province, the People’s Republic of China, China Automotive Systems, Inc. is a leading supplier of power steering components and systems to the Chinese automotive industry, operating through eight Sino-foreign joint ventures. The Company offers a full range of steering system parts for passenger automobiles and commercial vehicles. The Company currently offers four separate series of power steering with an annual production capacity of over 6 million sets of steering gears, columns and steering hoses. Its customer base is comprised of leading auto manufacturers, such as China FAW Group, Corp., Dongfeng Auto Group Co., Ltd., BYD Auto Company Limited, Beiqi Foton Motor Co., Ltd. and Chery Automobile Co., Ltd. in China, and Chrysler Group LLC in North America. For more information, please visit: http://www.caasauto.com.
This press release contains statements that are “forward-looking statements” as defined under the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent our estimates and assumptions only as of the date of this press release. These forward-looking statements include statements regarding the qualitative and quantitative effects of the accounting errors, the periods involved, the nature of the Company’s review and any anticipated conclusions of the Company or its management and other statements that are not historical facts. Our actual results may differ materially from the results described in or anticipated by our forward-looking statements due to certain risks and uncertainties. As a result, the Company’s actual results could differ materially from those contained in these forward-looking statements due to a number of factors, including those described under the heading “Risk Factors” in the Company’s Form 10-K annual report filed with the Securities and Exchange Commission on March 29, 2018, and in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission. We expressly disclaim any duty to provide updates to any forward-looking statements made in this press release, whether as a result of new information, future events or otherwise.
Article By: Andrew Rego