Sapura Industrial Unit Lands RM307 Mln Chery Axle Assembly Contract
KUALA LUMPUR, Nov 4 (Bernama) -- Sapura Industrial Bhd’s wholly-owned subsidiary, Sapura Machining Corporation Sdn Bhd, has signed a master purchase agreement with Chery Corporate Malaysia Sdn Bhd.
The agreement covers the assembly of front and rear axle systems for selected vehicle programmes, under a contract valued at an estimated RM307 million.
Chery Corporate Malaysia is the official regional arm and distributor of China's Chery Automobile Group in Malaysia.
In a Bursa Malaysia filing today, Sapura Industrial said the project will be undertaken at its facility in Bukit Beruntung, Selangor, over a 4.5-year period and marks the group’s first direct engagement with Chery.
“The project represents a strategic step in the company and its subsidiaries' manufacturing and assembly initiatives.
“Apart from being in line with Chery's localisation plans, it also supports Malaysia as an automotive manufacturing hub, enhances access to new market opportunities and reinforces the company's position as a trusted growth partner in advanced industrial manufacturing and assembly in Malaysia and the region,” said the automotive components manufacturer.
The project is expected to commence in the second half of the group's financial year ending Jan 31, 2027, and is expected to contribute positively to its earnings and earnings per share for the financial year.
Separately, Sapura Industrial said the contract scope covers the assembly of axle systems for Chery's internal combustion engine (ICE), hybrid electric vehicle (HEV) and battery electric vehicle (BEV) platforms, including the JAECOO J5 and vehicles under the LEPAS brand.
Managing director Datuk Syed Izuan Syed Kamarulbahrin said the contract underscores the confidence global automotive manufacturers place in Malaysia's automotive supply chain and local partners with proven technical expertise, operational strength and high-quality standards.
“We are pleased to establish a long-term partnership with Chery, supporting its localisation objectives and contributing to the advancement of Malaysia's automotive industry,” he said.
Chery Corporate Malaysia vice-president Cheng Namweng said Malaysia plays a key role in Chery's regional expansion ambitions, with capable local partners remaining central to its strategy.
“We have seen firsthand Sapura Industrial's professionalism, technical expertise and responsiveness throughout our engagement.
“The team has consistently demonstrated strong execution and a quality-focused approach, and we are confident in Sapura Industrial as a trusted partner as we continue expanding,” he said.
-- BERNAMA