1. Introduction to the Project
1.1 Project Background
1.1.1 Product Background
The bearing is the key basic part of the equipment manufacturing industry. At present, the performances and quality level of the rolling bearings produced in our country are not high as a whole and most of the high-grade bearings shall be imported. With the rapid development of the rail transit equipment industry, the demand for the high-grade bearings has been sharply increased. The demand for the more than 200km/h EMU bearings, heavy railway freight car bearings with the axle load of more than 30 tons and new urban rail vehicle bearings with the operating life of more than 2 million km has been increased.
1.1.2 Market Prospect
During the “12th Five-Year Plan”, the investment of the railway industry took on the situation that it was high in the first period and low in the last period. In 2010, the operating mileage of railways in the whole country is 91000km, the traffic mileage of the high-speed railways is 110000km, the special passenger railway reaches 13000km and the double-track rate and electric rate reach 50%, respectively; by 2020, the operating mileage of railways in the whole country will have reached 120000km, the new special passenger railways will have reached 16000km, the double-track rate will have reached 50% and the electric rate will have reached 60%.
The bearings of the high-speed railway vehicles and urban rail vehicles of our country basically depend on the imports. At present, the bearings of the high-speed EMU are basically SKF, FAG, Timken and NSK products. If the autonomous manufacturing is achieved in the high-speed railway products and rail transit products of our country, the key parts shall be based on the domestic market, which is of great importance for the high-speed train of our country to break through the foreign technical blockage. According to the “12th Five-Year Plan” of the Ministry of Railways, it is planned to have 990 16-car EMU and 426 8-car EMU in our country in 2014; it is planned to reach 1995 trains, including 1120 16-car EMU and 480 8-car EMU in 2015. By 2020, it is planned to have reached 2200 EMU, including 1530 16-car EMU and 670 8-car EMU. According to the 16-car EMU, each train shall be equipped with 128 bearings for the bogie equipment and 120 traction motor bearings, the bearings of each EMU are changed in the fourth-grade repair (1 year). It is predicted that the annual demand for the high-speed EMU bogie bearings is 0.2065 million and the annual demand for the traction motor bearings is 0.1958 million in 2015. In 2015, the demand in the railway vehicle maintenance market is 0.32 million, it is 0.1544 million in the new train bearing market and the total demand for the bearings reaches 0.4744 million. By 2020, the quantity of the online operating speed increased railway vehicles will have reached more than 0.3 million and the total demand for the bearings will have reached 0.5384 million. At present, the high-speed railway is achieving the cross-span development, the relevant new products and technologies are continuously entering our country, which has accumulated a large amount of experience for the technical application of the railway vehicle bearings. This will necessarily promote the development of the autonomous innovation technology of the domestic railway vehicles and advance the progress of the key technology, common technology and matching technology of the railway vehicle bearings.
With the 6th speed boost of the railways of our country, the demand for the high-accuracy bearings of the speed boost coaches and freight cars has been gradually increased, with the broad space for development. In 2012, the total 49 railway lines for passenger traffic have been built and the quantity of the coaches and freight cars operating on the lines reaches 0.3 million. By 2015, the preservation of the speed boost trains in the whole country will have reached more than 0.4 million; by 2020, the quantity of the speed boost coaches and freight cars operating on the line will have been more than 0.5 million. The main busy trunk lines will have achieved the division of coaches and freight cars on the different lines, the railway network with the rational layout, clear structure, complete functions and smooth cohesion will have been basically established and the main technical equipment will have reached or approached the international advanced level.
1.1.3 Technical Analysis
The project is planned to take the technology of the investment enterprise.
1.1.4 Advantageous Conditions of Project Construction
(1) Policy advantages
Nationalgovernment and departments have frequently promulgated the relevant policies so as to support and encourage the development of the high-end equipment manufacturing industry. The project construction meets the 13thFive-Year Plan for Economic and Social Development. The project can enjoy the special preferential policies and support policies of the national and provincial industrial development. In addition, the government of the zone exercises the investment promotion policy of “One Project One Discussion” for the investment enterprise.
(2) Personnel advantages
The human resources needed for the construction of the project can be available in the local area. There are rich human resources in our city. In the urban area, there are vocational schools, which can train the personnel according to the demands of the enterprises. Our city, with the good industrial development foundation, is only 1h ride to Changchun City, a famous “City of Colleges and Universities” and “Automobile City” in the whole country, so the personnel demand can be met.
 (3) Industrial foundation advantages
In Liaoyuan City, there has been a cluster of aluminum processing enterprises in a certain scale. There are 11 aluminum alloy and relevant enterprises, including 6 backbone enterprises, 2 companies listed in the market and 2 enterprises with the output value of more than 1 billion yuan, 3000 practitioners, annual output of about 0.5 million tons of aluminum alloy and deep-processing products and annual output value of more than 3.9 billion yuan. Liaoyuan City has the good location advantages and market environment of developing the aluminum refined and deep-processing. The industrial bases related to aluminum processing in the surrounding include Changchunn Railway Vehicle Base, Changchun Automobile Manufacturing Base, Shenyang Automobile Manufacturing Base, Shenyang Aviation Manufacturing Base, Shenyang Equipment Manufacturing Base, Qiqihar Freight Car Base, Northeast Oil Production Base, Green Food and Medicine Production Base and Changchun Photoelectric Information Industry Base, etc. Neighboring Tongliao-Huolinhe Coal Power and Aluminum Integration Industrial Base in Inner Mongolia, Liaoyuan City has the material supply advantages and good logistic advantages.
(4) Good infrastructural conditions
Around the site chosen for the project are the complete public facilities, “7-connection and 1-leveling” infrastructural conditions and good matching facilities, which have provided the solid foundation for the project construction and saved the project construction funds.
(5) Transport advantages
Liaoyuan has the advantageous location conditions and its capabilities bearing development have been continuously strengthened. Liaoyuan is located in the central belt of two major economic areas, that is, Changchun and Shenyang, 100km from Changchun in the north, 200km from Shenyang in the south, with the No. 303 National Highway and Simei Railway penetrating the whole area, constituting the comprehensive transport system extending in all directions with Liaoxi Railway, Changliao Expressway, Yingmei Expressway, Jicao Expressway and Liaoxi Expressway under the construction as well as Liaochang Railway to be started and becoming the new channel to the sea and overseas in the hinterland of Northeast China.
1.2 Content and Scale of Project Construction
1.2.1 Product Plan and Scale
The project is planned to produce the bearings of more than 200km/h EMU, heavy railway freight cars with the axle load of more than 30 tons and new urban railway vehicles with the operating life of more than 2 million km, including the oil bearings.
1.2.2 Construction Content
The construction and investment contents are mainly plant buildings, office building, purchased technical equipment and public matching facilities.
1.3 Total Investment of the Project and Capital Raising
The total investment of the project is 161 million yuan, including the construction investment of 130.8125 million yuan.
Table 1: Summary Table of the Total Investment of the Project          
No.    Expense Name    Amount of Investment    Proportion of Total Investment %    Remarks      
1    Construction investment     13081.25    81.25          
2    Interest in the construction period                  
3    Current funds    3018.75    18.75          
    Total investment of the project (1+2+3)    16100    100.00         
Note: “RMB10, 000” in the Table shall be RMB.
1.4 Financial Analysis and Social Evaluation
1.4.1 Main Financial Indexes
After the output of the project is reached, the annual sales income will be 157.24 million yuan and the profit will be 47.3529 million yuan, with the investment recovery period of 3.5 years (after the tax, including the construction period of 1.5 year) and the investment profit rate of 29%.
Table 2: List of Major Indexes for Forecast of Financial Benefits
No.    Name    Unit    Index    Remarks      
1    Business income    10, 000 yuan/a    15724    Normal year      
2    Total profit    10, 000 yuan/a    4735.29    Normal year      
3    Internal financial yield rate of the investment    %    26    After the income tax      
4    Net financial value (Ic=10%)    10, 000 yuan    582    After the income tax (operating period of 10 years)      
5    Recovery period of all the investment (after the tax)    a    3.5    Including the construction period of 1.5 years      
6    Investment profit rate    %    29         
Note: “RMB10, 000” in the Table shall be RMB.
1.4.2 Social Evaluation
The project construction fully supports the industrial structural adjustment of Liaoyuan City, further accelerate the reconstruction of Northeast Old Industrial Base and the rapid development of the industry of Liaoyuan City, promote the economic development of Liaoyuan City, increase the regional economic aggregate and the employments and reduce the social employment pressure. In addition, after the project is completed, it will prominently play the roles of reviving Northeast Old Industrial Base and optimizing the industrial layout of automobile parts of Jilin Province.
1.5 Cooperative Ways
Joint venture
1.6 What to be Invested by Foreign Party
Funds and technology
1.7 Construction Site of the Project
Jilin Liaoyuan Economic Development Zone
1.8 The On-going Condition of Project
The cooperative proposal of the project has been established.
2. Introduction to Partner
2.1 Basic Conditions
Name: Management Committee of Jilin Liaoyuan Economic Development Zone
Address: 1633 Caifu Road, Liaoyuan City
2.2 Overview
Jilin Liaoyuan Economic Development Zone is the provincial-level development zone founded in 2001 with the approval of Jilin Provincial Government in 2001. It now covers an area of 66.26km2, with the total population of 40716. It has preliminarily established the industrial structure dominated by some industries of processing of aluminum extrusion profiles, new energy, medicine health, textile socks and automobile parts, etc. and gathered a great number of big enterprises with the high technical contents, strong driving capabilities and good growth such as Midas Aluminum Industry Co., Ltd., Liyuan Aluminum Industry, etc. Since the 3rd Plenary Session of the 6th Municipal Committee of the Communist Party of China, Liaoyuan Economic Development Zone, basing itself on its own actual conditions and insisting in the differential development, intensive development and cluster development, has scientifically built the special parks and made great efforts to develop the special industries and achieve the centralization and cluster of advantageous industries.
2.3 Contact Method
Investment Promotion Bureau of Liaoyuan Economic Development Zone 
Contact person: Song Yang
Tel: 0437-3292088 
Fax: 0437-3292081

Contact Method of the Project City (Prefecture):
Contact Unit: Liaoyuan Economic and Technological Cooperation Bureau
Contact Person: Cui Shiwei
Tel: 0437-3528822    13766066922
Fax: 0437-3528822
Website of the City (Prefecture):


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