HVAC supplier chooses to locate in Detroit to access region's talent pool

For Zhang Daocai, chairman of the Sanhua Holding Group, it was a "historic moment, a milestone".

On Thursday, the manufacturer of controls and components for the commercial and residential heating, ventilation and air conditioning (HVAC) and refrigeration industries, announced the opening of its North American automative tech center in Detroit, Michigan.

Zhang flew to Detroit from headquarters in Hangzhou, East China's Zhejiang province to celebrate with staff members, government officials and business partners a crowning achievement for the company he started in 1984 on modest means.

"We chose Detroit to establish our first North American automative tech center because we want to access the talent pool, the latest innovation and technology, given the fact that the Big Three major American automotive companies - Ford, General Motors and Fiat Chrysler - are all here," said Zhang.

Detroit is "undoubtedly" the top spot for many automotive industry players, he added. "Besides, the majority of our clients in the automobile-related air conditioning and thermal systems are here; we can respond to inquiries and needs of our customers in a more timely manner."

Functions of the center are threefold: customer service, product testing and development, and research and innovation, said Stone Shi, general manager of Zhejiang Sanhua Automative Component Co Ltd. "It will also support our market expansion in the Americas as well as [help us] cooperate and collaborate with our headquarters' research and development center in Hangzhou."

Sanhua entered the US market by selling products through a trade company in the 1990s, then enhanced its American presence in 2002 by founding its US arm, Sanhua USA, to manage sales and distributions.

In 2007, it acquired Ranco, inventor and manufacturer of the four-way valve, and continuously expands its product line. Five years later, it bought Mississippi-based R-Squared Puckett Inc.

Sanhua USA has around 200 employees. To date, it has paid $1.3 million in taxes to the US government.

In April, Sanhua won a 2017 Automotive News PACE (Premier Automotive Suppliers' Contribution to Excellence) Award, often referred to as the "Academy Award for Innovation" in the automotive industry field, for its electronic expansion valve. It was the first China-based global supplier recipient in the award's 80 year-history.

Sanhua pledged to make more energy-efficient products and will gradually shift its product line toward "green".

Contact the writer at junechang@chinadailyusa.com