Contemporary Controls to open factory in China

Downers Grove, Ill. - An automation company with firm Midwestern roots is about to take the strategic step to open a 16,000 sq. ft production plant in Suzhou, China, near Shanghai. Contemporary Controls considers the move crucial to stay ahead of competitors. The new manufacturing plant-a wholly owned foreign enterprise or "WOFE"-will open in June 2002.


Downers Grove, Ill. - An automation company with firm Midwestern roots is about to take the strategic step to open a 16,000 sq. ft production plant in Suzhou, China, near Shanghai. Contemporary Controls considers the move crucial to stay ahead of competitors. The new manufacturing plant - a wholly owned foreign enterprise or 'WOFE' - will open in June 2002. Contemporary Controls president and ceo George Thomas made the announcement at the National Industrial Automation Show in Chicago, March 20.

Contemporary Controls (CC) equates 'the future of manufacturing' with China. Mr. Thomas thinks that time is right to leverage off the steadily rising number of semiconductor fab facilities, automotive plants, and consumer electronics factories opening in China. 'Some of these plants are as modern as any in the world, indicating a huge demand for automation equipment,' says Mr. Thomas. He plans, as well, to introduce CC's automation technology in China. Included here are industrial networking products which connect computers and controllers, based on ArcNet, CAN (Controller Area Network), and Ethernet technologies.

Manufacturing will continue at the main U.S. facility (Downers Grove), along with product development, and validation of designs, but Mr. Thomas plans full-fledged manufacturing at the new Suzhou plant. 'ArcNet products will be introduced first, but all three of the company's technologies are fair game,' he states. 'With many other international companies operating in China, it's only a matter of time before our competitors will be there.' Mr. Thomas also sees China as a source of electronic components, and seeks to make CC the first in its sector to use such components. 'Much of electronics products already comes from China,' he says.

Huge manufacturing potential

China's huge potential for high-tech manufacturing stems from a large, skilled workforce with a salary structure that's attractively 'low-cost' by Western standards. And the Chinese government is making it easier for international companies to do business there. It also provides incentives. One example is a tax holiday that postpones and lowers corporate income taxes for a number of years; and the taxman's 'clock' starts at the first year with profits.

The Suzhou region has become especially attractive to WOFE companies. Suzhou New District includes the first ISO 14000-certified industrial park in China, according to Yu Dong Gen, vice director of the Investment Promotion Bureau of the Suzhou People's Municipal Government. (ISO certification applies to the whole industrial park, not just one facility.) More than 550 foreign-funded companies have been established in the area, 40 of them Fortune 500 multinational companies, stated Mr. Yu, who was a speaker at Contemporary Controls' announcement.

Steady progress, product intro

Founded under humble circumstances by Mr. Thomas in 1975, Contemporary Controls has grown steadily as it widened its product line and participation in technical and standards groups. The company is hardly a newcomer to international ties despite its small size of approximately 40 employees worldwide. A wholly owned subsidiary of CC was established in Coventry, U.K. in 1997. And an ongoing cooperative partnership between CC and Heyfra Electronics GmbH (Eisleben, Germany) has resulted in the formation of Contemporary Controls GmbH i.G. (CCG) in February 2002. Ownership of CCG is split 50/50 between the partner companies. The 'i.G.' label signifies that the new company is 'in formation' until official notification of approval by the German government, notes Mr. Thomas. It's expected that CCG will relocate in Heyfra's modern 22,600-sq. ft facility in the near future.

New product has already emerged from the partnership. CTRLink is an evolving line of Industrial Ethernet hubs, switches, media converters, routers, gateways, and adapters needed to implement an Ethernet network. Available in standard-sized or miniature enclosure that mount conveniently to a DIN rail, CTRLink products support redundant power connections, in case of power failure, and operate from various low-voltage ac or dc power sources.

Opportunities to expand industrial networking technologies - whether in North America, Europe, or Asia - continue to be the vision at Contemporary Controls.

Control Engineering Daily News Desk
Frank J. Bartos, executive editor

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