ERIE, Pa. and Shenyang, China (January 12, 2009) – GE Drivetrain Technologies, a unit of GE Transportation, and A-Power Energy Generation Systems (NASDAQ: APWR) announced today that they have signed two Letters of Intent (LOI), one for GE Drivetrain Technologies to supply A-Power with 2.7 megawatt (MW) wind turbine gearboxes and a second to establish a Joint Venture partnership for a wind turbine gearbox assembly plant.
Under the supply agreement, GE Drivetrain Technologies will supply A-Power with more than 900 2.7 MW gearboxes beginning in 2010. “We’re excited about the opportunity to serve A-Power,” said Prescott Logan, Business Leader GE Drivetrain Technologies. “The speed and focus that A-Power has brought to building its wind turbine business, combined with the highly reliable design of its Fuhrländer 2.7 MW turbine, position A-Power well for long-term success in China and the broader global market.”
Added Logan: “Our agreement with A-Power is part of our larger strategy to build our customer base through key strategic partnerships, expand into new geographies, and develop innovative drive train systems that leverage GE Drivetrain Technologies’ more than 100 years of designing and manufacturing electromechanical drives.”
The companies' joint venture agreement creates a wind turbine gearbox assembly business that will be majority owned by GE Drivetrain Technologies and operate under the name GE Transportation. The new assembly plant will bring multi-megawatt gearbox capacity to China and serve as GE Drivetrain Technologies’ Southeast Asia manufacturing center from which it will serve its customers in the region beginning in mid-2010.
The Joint Venture company will take advantage of A-Power’s knowledge of the local market, as well as of GE Drivetrain Technologies’ process and quality expertise.
Establishing a joint venture with a strong partner such as A-Power is consistent with GE Transportation’s approach to the global market. “GE’s successful history of conducting business in China is based on our belief that we must operate as a local company,” said Tim Schweikert, President of GE Technology Infrastructure in China. “We appreciate the value of a local perspective as we bring advanced wind drive train technology to the forefront in China.”
The combination of these two agreements fits well with A-Power’s business strategy and complements investments that it has already made to build a world-class wind turbine business. “Our gearbox supply agreement and JV partnership with GE Drivetrain Technologies represent another significant building block in the foundation of our wind turbine business,” said John S. Lin, Senior Vice President, Director, Chief Strategy Officer and acting Chief Financial Officer of A-Power. “We are pleased to partner with a company such as GE that brings global quality standards, renowned engineering expertise, proven design, and a commitment to a local supply chain.”
These agreements support China’s initiative to increase wind energy output from one gigawatt in 2005 to 30 gigawatts by 2020 and are the basis for additional future investments by GE Drivetrain Technologies in its local supply chain and advanced wind turbine drive train products, such as its IntegraDrive geared generator.
About GE Transportation
Established more than 100 years ago, GE Transportation, a unit of General Electric Company (NYSE: GE), is a global technology leader and supplier to the railroad, marine, drilling, mining and wind industries. GE provides freight and passenger locomotives, railway signaling and communications systems, information technology solutions, marine engines, motorized drive systems for mining trucks and drills, high-quality replacement parts and value added services. With sales in excess of $4.5 billion, GE Transportation is headquartered in Erie, PA, and employs approximately 10,000 employees worldwide. For more information visit www.getransportation.com.
A-Power Energy Generation Systems, Ltd., through its PRC operating subsidiary, Liaoning GaoKe Energy Group Co., Ltd., is the largest provider of distributed power generation systems in China and entered China's wind energy market in 2008. The Company is also focused on developing and commercializing additional renewable energy technologies and has strategic relationships with both Tsinghua University and the China Sciences Academy in Guangzhou.