Geislinger GmbH, Austria’s leading engine parts maker, will set up a manufacturing base in Busan to facilitate supplies to local shipbuilders, city officials said Wednesday.
The Salzburg-based firm clinched an agreement with the Busan government to build a plant at the southern port city’s industrial complex and hire more than 100 workers by injecting $10 million, officials said. They did not give details on the time frame.
The deal marks the largest project involving an international company since the region became a foreign investment zone last month by ensuring nearly 135 billion won ($120 million) in state subsidies.
With the special status, Busan can rent sites for free for up to 50 years and provide tax and administrative incentives for foreign investors.
Established in 1958, Geislinger produces couplings, dampers and other engine components for ships, trains and construction gears. It fetched about 120 billion won in sales last year. Most of its output here will be delivered to Korean companies including STX and Doosan, Busan officials said.
“Busan has been striving for two years to convince Geislinger, which initially targeted China for the new factory, of the city’s merits such as its good location, labor pool and position as a mecca for the global shipbuilding industry,” the municipality said in a statement.
It added that the project would also help boost related parts and materials manufacturing in the region.