German lubricant Zeller+Gmelin said this week that it is expanding in China, relocating into a larger factory after agreeing to buy out its joint venture partner in the country.
The lubricant and chemical company, which is based in Eislingen, Germany, said it is taking the actions in order to meet growing sales demand and to accommodate changes in local regulations.
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The company currently produces lubricants in Luxu, 80 kilometers west of Shanghai, through a joint venture established in 2006, Zeller+Gmelin (Suzhou) Co. Sales in China have grown at a 15% clip since 2010 and have now outstripped capacity of that facility, the company said in a news release issued today.
“The demand for high quality lubricants in China continues to grow,” Managing Director Siegfried Mueller said. “For this reason we are significantly expanding our presence close to our customers.”
The company added that it was forced to relocate because of changes in local regulations on chemical companies. The joint venture partner, which was not named in the press release, was unwilling to contribute funds toward the expansion, so Zeller+Gmelin bought it out.
In addition to lubricant blending operations, the company said it will add ink production facilities to the new factory. Printing inks is among the products that Zeller+Gmelin makes.
The new factory apparently is also in Luxu, although the news release did not specify the location. The company said the project will be completed this year, but it did not disclose the capacity of the new or existing blending plants.