South Korea’s Mando Corporation announced on Tuesday it has signed a $520 million deal to supply motor-vehicle parts to General Motors.
Mando expects additional orders from GM and other United States carmakers after the free-trade agreement between South Korea and the U.S. is implemented next year.
“As tariffs on Korean-made auto parts excluding tires will be removed immediately the pact takes effect, we expect an increase in orders from our existing customers such as GM, Ford and Chrysler,” a Mando spokesman was quoted as saying by Wall Street Journal.
Mando said it will supply high-end products like power-steering systems and caliper brakes for vehicles built by GM from 2014. Mando’s previous contract with GM, signed in 2009, states that the Korean company will begin delivering power-steering systems from 2012. It is normal for auto parts makers to sign supply deals with manufacturers some years ahead of delivery.
Mando will also deliver parts to PSA Peugeot Citroen, Renault, BMW, Volkswagen and Nissan in contracts secured some years earlier.