As part of the Chinese government's USD586 billion economic stimulus package, the government of Hengyang in Hunan has agreed to provide lead acid battery manufacturer China Ritar Power Corp. with a new industrial park in Hengyang, which will enable China Ritar to expand its production capacity three fold.
Once the new facility is in full production, China Ritar's total annual production capacity will increase to approximately USD650 million, up from its current annual production capacity of USD200 million.
In an effort to encourage new development in Hengyang, the Hengyang government has agreed to add a new industrial park with nine production facilities and two dormitories on 214.7 square kilometers of land next to China Ritar's current industrial park. The new industrial park is expected to be completed and ready for equipment to be installed by October 2009. China Ritar will receive free use of the facilities for the first year and then pay the Hengyang government approximately 50% of the market price for the following four years. Furthermore, China Ritar has complete flexibility as to the number of buildings it will utilize along with the first right to purchase the facilities.
Jiada Hu, China Ritar's chairman and CEO commented that the completion of this agreement with the Hengyang government was extremely timely as demand for the company's lead acid batteries continues to grow: especially in the telecommunication, alternative energy, and electric vehicle markets.