Aussie transmissions bound for China

CHINESE-owned Australian automotive transmission designer and manufacturer Drivetrain Systems International (DSI) has sealed a deal to export Australian-made rear-wheel-drive automatic transmissions to an unnamed Chinese vehicle-maker starting later this year.

The transmissions will be built at the company’s Albury plant which, ironically, is closed for two days this week due to a parts supply problem that has temporarily halted production of its six-speed front-wheel-drive transmission for South Korean car-maker SsangYong.

Like the SsangYong transmissions, which are fitted to the new Korando compact SUV, at least some of the rear-drive units are likely to boomerang back to Australia, this time in Chinese-built vehicles that are scheduled to go into production in early 2012.

DSI commercial manager for rear-wheel-drive transmissions Michael Gilchrist told GoAuto that the Chinese customer for the transmission had a business presence in Australia, but it was not DSI parent company Zhejiang Geely Automobile Holdings, which acquired DSI after it went into receivership when its major customer SsangYong hit trouble in 2009.

“It is not for our parent, I can tell you that,” he said. “It is for another customer.” Mr Gilchrist said the export deal was good news for the plant, adding handy volume to the rear-drive production line.

“If you have compare it with the volumes for our other rear-wheel drive customers, it is reasonable,” he said. “And it is good because we have the plant capacity to allow us to do it.

“We don’t have to make any investment there we just go ahead and do it.” At least seven Chinese vehicle makers have established sales beachheads in Australia, with Great Wall Motors, Chery, Geely, Higer, Foton and JAC already operational through independent distributors, and ZXAuto only months from offering utes for sale.

Last year, DSI confirmed it was preparing to export a rear-drive five-speed automatic transmission to China for Geely-owned London Taxi International’s Chinese factory, starting this year.

GoAuto has spotted one of the 2.5-litre diesel-powered boxy black cabs under test in Melbourne in recent weeks.

The same five-speed transmission is likely to be the subject of the new export deal, details of which DSI says are still confidential.

The transmission is made on the same production line that built four-speed automatic transmissions for Ford Australia’s Territory and Falcon wagon and E-Gas models until last year, before the car-maker switched over to imported ZF six-speeders.

DSI also has a production-ready seven-speed rear-drive transmission that was originally developed for SsangYong’s Rexton SUV before the Korean company went bankrupt and the program was abandoned.

Capable of being upgraded to an eight-speeder, the transmission is sitting on the shelf at DSI’s Melbourne research and development centre, awaiting a customer.

The Albury factory is currently making small numbers of rear-drive transmissions for export, but has strong demand from SsangYong for front-drive transmissions for its Korando.

SsangYong is preparing to unveil a broader range of products in concept form at next month’s Frankfurt motor show, perhaps including passenger cars in need of an automatic transmission.

Mr Gilchrist said SsangYong was buying every front-drive transmission the factory could make.

Unfortunately, a glitch with supplied parts has upset production, with 250 workers having to bring forward two rostered days off while the company tries to sort the issue this week.

Australian Manufacturing Workers Union’s NSW vehicle division secretary Sean Morgan told Albury’s Border Morning Mail:

“They (DSI) haven’t got quality parts and they don’t want to make product with what they’ve got.” DSI operations manager Barry Maginness was quoted as saying the arrangement was necessary as the factory was awaiting supplies from overseas.

Mr Maginness said production levels were expected to rise in late August with increased demand from customers SsangYong and Mahindra.

While DSI is working to secure production at its Australian plant, it is also helping parent company Geely to establish three major transmission plants in China.

The first, in the south-central province of Hunan, is set to begin production of the Australian-designed six-speeder in August – the first Chinese-made automatic transmission.

During its start-up phase, the plant is being managed by an Australian DSI production executive, who will turn it over to Chinese management as the factory ramps up production over the next six months. Ultimately, it will build a maximum of 200,000 units a year for Geely and other Chinese car-makers.

Two more similar plants are also under construction - one of them at Chongqing, the home city of major Chinese car-maker Changan.

Collectively, they will be capable of producing 600,000 automatic transmissions, all of them destined for the Chinese domestic car-makers.

The Albury plant is responsible for front-drive transmissions for customers outside of China, including SsangYong and its parent company, India’s Mahindra and Mahindra, while also producing all rear-drive transmissions globally, including for China.