China Automotive Systems Awarded First South American EPS Contract

Rhea-AI Summary

China Automotive Systems (NASDAQ: CAAS) announced that subsidiary Hubei Henglong won a contract to supply its C-EPS (column-assist electric power steering) for a new South American vehicle platform.

The platform covers gasoline and hybrid passenger models with planned annual sales of over 300,000 units and mass production expected in early 2028. Henglong already has a >30% market share in Brazil and an established factory there since 2012. The project upgrades Brazil operations from mechanical to electric steering and adds local manufacturing, engineering collaboration, supply chains, and after-sales support.

Positive

• Planned volume >300,000 units annually
• Mass production targeted for early 2028
• Brazil market share over 30%
• Overseas factory established in Brazil since 2012
• Operational upgrade from mechanical to C-EPS systems

Negative

• None.

Key Figures

Planned annual sales volume over 300,000 units New South American vehicle platform using C-EPS

Brazil market presence over 30% market share Brazilian steering system market for Henglong

Mass production start early 2028 C-EPS project for South American vehicle platform

International goals horizon 2030 Company’s ambitious international goals timeline

First overseas factory 2012 Establishment of Brazil Henglong in São Paulo

Market Reality Check

$4.47 Last Close

Volume Volume 8,827 is below 20-day average 25,861 (relative volume 0.34) ahead of this news. low

Technical Price $4.35 is trading slightly above the 200-day MA at $4.24 before the announcement.

Peers on Argus

Peers show mixed moves: LAZR -13.06%, CVGI -1.6%, STRT -0.87%, HYLN -0.55%, while SRI +2.74%. No clear sector-wide trend aligned with CAAS.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Dec 05	Product line ramp	Positive	-0.9%	Mass production of high-torque intelligent steering motors for commercial vehicles.
Nov 12	Earnings and guidance	Positive	+6.7%	Strong Q3 growth, higher EPS and raised full-year revenue guidance.
Nov 03	Strategic cooperation	Positive	-0.7%	MoU to localize EPS and steering production for ASEAN market in Malaysia.
Oct 21	New tech launch	Positive	+3.3%	Launch of rear-wheel active steering system for upper mass-market EVs in China.
Sep 11	Redomiciliation merger	Neutral	-1.7%	Completion of redomiciliation merger into Cayman entity with 1-for-1 share conversion.

Pattern Detected

Operational and technology wins have sometimes seen muted or negative next-day moves, while strong earnings and guidance upgrades aligned with positive price reactions.

Recent Company History

Over the last few months, CAAS has reported several operational and strategic milestones. On Nov 12, 2025, it delivered strong Q3 results with 77.8% EPS growth and raised full‑year guidance, and the stock rose 6.71%. Other product and partnership updates on Oct 21, Nov 3, and Dec 5, 2025 showed technology and regional expansion progress but produced mixed price reactions. The current South American EPS contract continues this international expansion trajectory, especially building on prior Brazil exposure.

Market Pulse Summary

This announcement highlights CAAS’s first large-scale C‑EPS contract in South America, anchored to a platform with planned annual sales above 300,000 units and mass production expected in 2028. It builds on more than a decade in Brazil and a steering market share above 30%. In context of earlier technology launches and guidance upgrades, investors may watch contract conversion into revenue, execution of Brazil capacity upgrades, and progress toward the company’s 2030 international goals.

Key Terms

electric power steering technical

"entry of the Group's electric power steering systems into the South American"

Electric power steering is a car steering system that uses an electric motor and sensors to add force to the driver’s steering input instead of a hydraulic pump. It matters to investors because it can improve fuel efficiency and reduce weight and maintenance, help meet emissions and efficiency rules, and shift value toward electronics and software suppliers—affecting vehicle costs, margins and electric-vehicle range.

column-assist electric power steering technical

"C-EPS (Column-Assist Electric Power Steering) project for a new vehicle platform"

An electric power steering system where the small electric motor that provides steering help is mounted on the steering column (the shaft between the wheel and the rack). It works like an electric helper attached to the steering shaft that lightens the effort needed to turn the wheel and can be tuned for feel and stability. Investors care because this layout reduces vehicle weight and energy use compared with hydraulic systems, affects production cost, reliability and aftermarket repair costs, and enables electronic driver‑assist features that can influence a vehicle’s safety ratings and market appeal.

OEM technical

"earned high appreciation from OEM customers. This new collaboration in South"

OEM stands for Original Equipment Manufacturer, which is a company that produces parts or components used in the final products made by other companies. For investors, understanding OEMs is important because their performance can impact the supply chain and overall success of major industries, especially those relying on specialized parts. Think of OEMs as the suppliers that provide the building blocks for larger products, like the engine parts for a car.

automotive supply chain technical

"entry of the Group's electric power steering systems into the South American automotive supply chain."

The automotive supply chain is the network of companies and processes that design, make and move the parts, components and software used to build and service vehicles — from raw material suppliers and parts manufacturers to logistics, assembly plants and dealers. Investors care because delays, shortages or cost changes at any point can slow production, raise expenses or boost profits for suppliers, like how a missing bolt can stop an entire machine from working.

AI-generated analysis. Not financial advice.

WUHAN, China, Dec. 17, 2025 /PRNewswire/ -- China Automotive Systems, Inc. (NASDAQ: CAAS) ("CAAS" or the "Company"), a leading power steering components and systems supplier in China, today announced that its wholly owned subsidiary, Hubei Henglong Automotive System Group ("Henglong"), was awarded a contract for its C-EPS (Column-Assist Electric Power Steering) project for a new vehicle platform from a leading South American-based automotive manufacturer. This collaboration marks the first large-scale entry of the Group's electric power steering systems into the South American automotive supply chain. This contract marks another key achievement in the CAAS' international expansion strategy and lays the foundation to reach the Company's ambitious international goals for 2030.

This vehicle platform will cover several gasoline fuel and hybrid passenger vehicle models, with planned annual sales volume of over 300,000 units and mass production is expected in early 2028.

Henglong's successful full-process development of similar C-EPS products for European markets has earned high appreciation from OEM customers. This new collaboration in South America further demonstrates international automakers' growing confidence in Henglong's R&D and manufacturing capabilities for electronic control and steering systems.

In 2012, Henglong established its first overseas factory in São Paulo, Brazil – CAAS Brazil's Imports and Trade in Automotive Parts Ltd. (Brazil Henglong) – and has been deeply rooted in the South American markets for over a decade. Leveraging its advanced technologies, quality control capabilities, and economies of scale built by its Chinese and Brazilian teams, Henglong has now amassed a market share of over 30% in the Brazilian steering system market.

This C-EPS project development will deliver a comprehensive industrial upgrade for Brazil Henglong, migrating from single-function mechanical steering products to advanced electric power steering systems.  According to the strategic plan, CAAS will establish a complete operational and support network to promote electric power steering in Brazil. New manufacturing capacity, engineering collaboration, secondary supply chains, and after-sales support will enable CAAS' deeper integration of advanced technology and superior localized services. C-EPS systems have an electric motor and assist mechanism attached directly to the steering column. By adding torque to the column via gears, C-EPS creates efficiency and saves both space and fuels.

Mr. Qizhou Wu, the Chief Executive Officer of CAAS, commented, "The progress of this project will turbocharge our strategic expansion into the South American markets and provide crucial technological transformation in one of the key global automotive markets. Our growing presence in the South American markets also complements our strong footprint in Asia, Europe and North America as we continue to add to our global reach."

About China Automotive Systems, Inc.

Based in Hubei Province, the People's Republic of China, China Automotive Systems, Inc. is a leading supplier of power steering components and systems to the Chinese automotive industry, operating through its sixteen Sino-foreign joint ventures and wholly owned subsidiaries. The Company offers a full range of steering system parts for passenger automobiles and commercial vehicles. The Company currently offers four separate series of power steering with an annual production capacity of over 8 million sets of steering gears, columns and steering hoses. Its customer base is comprised of leading auto manufacturers, such as China FAW Group, Corp., Dongfeng Auto Group Co., Ltd., BYD Auto Company Limited, Beiqi Foton Motor Co., Ltd. and Chery Automobile Co., Ltd. in China, and Stellantis N.V. and Ford Motor Company in North America. For more information, please visit: http://www.caasauto.com. 

Forward-Looking Statements

This press release contains statements that are "forward-looking statements" as defined under the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent our estimates and assumptions only as of the date of this press release. Our actual results may differ materially from the results described in or anticipated by our forward-looking statements due to certain risks and uncertainties. As a result, the Company's actual results could differ materially from those contained in these forward-looking statements due to a number of factors, including those described under the heading "Risk Factors" in the Company's Annual Report on Form 10-K as filed with the Securities and Exchange Commission on March 28, 2025, and in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission. Any of these factors and other factors beyond our control, could have an adverse effect on the overall business environment, cause uncertainties in the regions where we conduct business, cause our business to suffer in ways that we cannot predict, and materially and adversely impact our business, financial condition and results of operations. A prolonged disruption or any further unforeseen delay in our operations of the manufacturing, delivery and assembly process within any of our production facilities could continue to result in delays in the shipment of products to our customers, increased costs and reduced revenue. We expressly disclaim any duty to provide updates to any forward-looking statements made in this press release, whether as a result of new information, future events or otherwise.

For further information, please contact:

Jie Li
Chief Financial Officer
China Automotive Systems, Inc.
jieli@chl.com.cn 

Kevin Theiss
Awaken Advisors
+1-212-510-8922
Kevin@awakenlab.com 

View original content:https://www.prnewswire.com/news-releases/china-automotive-systems-awarded-first-south-american-eps-contract-302644390.html

SOURCE China Automotive Systems, Inc.

FAQ

What contract did China Automotive Systems (CAAS) win on December 17, 2025?

CAAS announced Henglong won a contract to supply its C-EPS for a new South American vehicle platform.

How many units per year will the CAAS C-EPS project target?

The vehicle platform has planned annual sales of over 300,000 units.

When is mass production for CAAS's South American C-EPS expected to begin?

Mass production is expected in early 2028.

What is Henglong's existing market position in Brazil mentioned by CAAS?

Henglong has accumulated a market share of over 30% in the Brazilian steering system market.

How will the CAAS project change Brazil operations for (NASDAQ: CAAS)?

The project migrates Brazil operations from single-function mechanical steering to advanced electric power steering with new local capacity and support.

Does CAAS have prior presence in South America before this C-EPS contract?

Yes; CAAS established its first overseas factory in São Paulo in 2012 and has been operating in South America for over a decade.