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In addition to the recently announced new propellant factory in China, Autoliv Inc. (NYSE:ALV)(STO:ALIVSDB) – a worldwide leader in automotive safety systems – is adding a sixth processing facility at its Promontory, Utah location to meet growing demand for airbag gas generant. The company also announced plans to expand its Tremonton, Utah facility to keep pace with market growth for initiators and micro gas generators used in its airbag and seatbelt products.
The new facility in Promontory will add 20 percent more capacity to Autoliv’s existing global gas generant production capabilities. This capacity increase will position the company to take advantage of growing worldwide demand for Autoliv airbag inflators. Capital investment is expected to cost approximately $13 million.
Autoliv Promontory has been at the heart of the company’s airbag operations since the late 1960’s when the company began the airbag industry’s pioneering research to use solid propellants for inflating airbags. Today, the facility produces gas generant used to inflate the more than 50 million driver, passenger, side and inflatable curtain airbags that Autoliv builds in the Americas annually. It also houses the company’s state-of-the-art Airbag Recovery Center for the deactivation and recycling of airbags.
The company is also adding 33,000 square feet (3,065 m2) to its Tremonton facility – already a leading global producer of initiators and micro gas generators for automotive safety products. The majority of floor space added in this $5 million expansion is slated for new production lines which could supply up to 30 percent more capacity when the space is fully utilized. Current plans call for just two new lines to be completed in 2013, adding 10 percent more initiator capacity.
The Tremonton facility has experienced double digit year-over-year growth for the past three years and expects this trend to continue into 2013. As well as enhancing initiator capacity, the plant is adding shipping and receiving docks to ensure timely distribution to Autoliv customers around the world. When completed in 2013, the two expanded Utah facilities expect to add nearly 50 employees to the labor force.
Only four weeks ago, Autoliv announced another expansion of its global airbag propellant capacity. It is a completely new facility in China that will raise this capacity by 25 percent on top of the enlargement of the U.S. facility. This is an investment of $33 million, Autoliv’s single largest capital expenditure ever.