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Castrol and Dong Feng Join Hands To Manufacture Lubricants In China

Castrol, the lubricant brand of the BP group, and Dong Feng Group announced today that they are to form a joint venture company to supply lubricants to the growing Chinese market.

The new company, Dong Feng-Castrol Lubricant Co., Ltd, will be based in Wuhan, in Hubei Province, the largest city in central China, and is the first Chinese-based lubricant equity joint venture between a global lubricant major and a leading Chinese automobile manufacturer. Under the joint venture contract, BP, Dong Feng Motor Corporation and Dong Feng Automobile Co Ltd. will have equity stakes of 50:20:30 per cent respectively in the joint venture, which will run for an initial 30 year period.

With a total investment of RMB120 million and total production capacity of 50,000 tons per year, the joint venture will carry out product research and development, manufacturing and the marketing of a range of dual-branded Dong Feng-Castrol automotive lubricant and antifreeze products. In addition, the joint venture’s products will be used for both the first-fill and service fills for the full range of Dong Feng automobiles, ensuring all Dong Feng customers benefit from high quality products and service.

Owned by BP, Castrol is a highly regarded global premium lubricant brand with over 100 years of technology leadership and research and development expertise.

"The joint venture will combine Castrol’s widely recognized advanced technology, management and marketing expertise with Dong Feng's strengths, which include a highly educated workforce, safety awareness and excellent logistics management," said David Baldry, BP's Group Vice President, Lubricants.

A red and green ribbon was used at the signing ceremony to represent the win-win partnership between Castrol and Dong Feng.

Mr. Ren Shimao, Vice Governor of Hubei Province, indicated that "the co-operation between a world-renowned lubricant specialist and China’s leading vehicle manufacturer will, no doubt, bring enormous benefits to the development of the automotive industry in Wuhan and also its neighbouring areas in Central China. It will definitely help to bring lubricant quality and technology development to a new level."

Speaking at the ceremony, Mr. Chen Yan, Chairman of the joint venture company, said: "The Castrol-Dongfeng joint venture will bring us to the forefront of best-in-class partnerships. We firmly believe that such collaboration will make it possible to bring together engine technology development, lubricant technology expertise, international management practices, local market knowledge, an educated workforce and international standard production facilities. All these elements will contribute to the success of this partnership, which in turn will greatly enhance our ability to build our market presence here in China."

"Dong Feng Motor Corporation is known as the world’s third largest truck manufacturer and also one of China's top three automotive companies. The partnership with BP represents a strategic move to provide the best products and service offers to our consumers. And we are confident that our collaboration with the leading lubricant specialist will bring us more competitive advantages, through the development of the best product and service offerings, said Mr. Xiang Kaiyong, General Manager of the Joint Venture.


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