HARBIN, Nov. 22, 2010 /PRNewswire-Asia-FirstCall/ – China XD Plastics Company Limited ("China XD Plastics" or the "Company"), (Nasdaq: CXDC), one of the leading Chinese manufacturers engaged in the development, manufacture, and distribution of modified plastics primarily for use in automotive applications in China, today announced that it has signed an exclusive agreement with Ningbo Huazhong Plastic Products Company Limited ("Ningbo Huazhong") to develop and supply modified plastics for use in electric vehicles. As part of the agreement, China XD Plastics maintains the right to develop products for other automotive plastic manufacturers.
Ningbo Huazhong is a certified automotive parts supplier for a number of leading automotive OEMs in China, including China FAW Group, Shanghai Automotive Industry Corporation, Beijing Automotive Works and China Second Automobile Group, among others. According to the agreement, China XD Plastics will have the exclusive rights during the next three years to develop high-performance new plastic materials for use in Ningbo Huazhong's electric vehicle parts, with a primary focus on battery modules, charging stations and other applications.
Due to the many advantages of electric vehicles, including greater energy efficiency and lower emissions, the Chinese government has indicated in its twelfth five-year plan that it will invest 4 trillion Yuan, approximately $600 billion US dollars, to support the development of nine industries, including alternative energy automobiles and environmentally friendly new materials. By 2012, automobile production in China is expected to exceed 20 million units, with alternative energy vehicles expected to account for 10%, or over two million units, of total automobile production. Total demand for the new plastic materials for use in alternative energy vehicles is projected to exceed 250 thousand metric tons by 2012. China XD expects to derive additional growth opportunities by capitalizing on the development of the alternative energy vehicle market in China.
Mr. Jie Han, Chairman and CEO of China XD Plastics, commented, "We are pleased to announce our broadened strategic partnership with Ningbo Huazhong. We believe that this alliance further validates our leading position in the developing market for plastic materials for use in electric vehicles, while speaking volumes to our continuing R&D capability. We will continue to seek additional opportunities in this growing market, and we believe China XD is well positioned to meet the increasing demand for electric vehicles and other high-end modified plastics end markets."
About China XD Plastics Company Limited
China XD Plastics Company Limited through its wholly owned subsidiary, Harbin Xinda Macromolecule Material ("Xinda"), develops, manufactures, and distributes modified plastics, primarily for automotive applications. The Company's specialized plastics are used in the exterior and interior trim and in the functional components of more than 60 automobile brands manufactured in China including Audi, Red Flag, Volkswagen and Mazda. The Company's wholly-owned research institute is dedicated to the research and development of modified plastics, and benefits from its cooperation with well-known scientists from prestigious universities in China. At present, 169 of Xinda's products have been certified for use by one or more of the automobile manufacturers in China. For more information please visit http://www.chinaxd.net.
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this announcement are forward-looking statements, including but not limited to, the Company's ability to increase the number of certifications; the Company's ability to introduce new product applications for automobiles; the effectiveness, profitability, and the marketability of its products; the Company's ability to successfully expand its production capacity; the Company's ability to protect its proprietary information; general economic and business conditions; the volatility of the Company's operating results and financial conditions; the Company's ability to attract or retain qualified senior management personnel and research and development staff; and other risks detailed in the Company's filings with the Securities and Exchange Commission ("SEC"), which are available on the SEC's website at http://www.sec.gov. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and its industry. The Company undertakes no obligation to update these forward-looking statements to reflect subsequent occurring events or circumstances, or to changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results.
SOURCE China XD Plastics Company Limited