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A Closer Look At Johnson Controls' Focus On China

Johnson Controls recently opened its second global corporate headquarters in Shanghai, China, supporting the enormous growth opportunities present in the country, as well as in other regions in Asia-Pacific. Already well-established in China, the company continues to accelerate its growth there through plant openings, key customer partnerships, joint ventures, and strategic agreements. The new facility has set “a new standard for green and smart buildings,” with a design that focuses on renewable energy, intelligent lighting, and building automation systems that are expected to reduce energy consumption by 44%, compared to local standards. Moreover, its gray water recycling programs and storm water recapture facilities will reduce water usage by 42%.

Johnson Controls’ CEO Alex Molinaroli, while speaking with CNBC, also stated that the company is bullish on China’s prospects, despite its ups and downs. The company expects double-digit growth from the country in the next one to three years, given the high GDP growth rates. China’s economy grew at a rate of 6.9% in the first quarter, despite the pace of growth slowing down in recent years. JCI is also looking to make in-roads in the Indian market, one of the fastest growing major economies in the world.

Growth Opportunities For AGM Batteries

Johnson Controls formed a joint venture with Binzhou Bohai Piston Co., an auto parts affiliate of Beijing Automotive Industry Group Co. (BAIC Group), to build its fourth automotive battery plant in China. This plant will manufacture both conventional flooded, and absorbent glass mat (AGM) battery technologies. AGM Batteries, which power start-stop systems, are technologically advanced car batteries that are more expensive than a conventional lead acid battery, but are better equipped to handle the strain of frequent engine restarts and the ever-increasing load placed on car batteries. They are employed in vehicles with start-stop technology which, while being fuel-saving, can tax a car battery since the electrical system still uses energy from the battery when the vehicle turns off. In the Chinese market there is demand for auto part technologies that can improve fuel efficiency, and the demand for AGM batteries is expected to soar, as they increase fuel efficiency by up to 5%.

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