MANUFACTURERS faced serious financial pressure in the first three quarters of this year due to the increased cost of raw material and labor.

    Qingte Group in Qingdao has also faced this situation. “The biggest problem is the high raw material cost, followed by labor cost, logistics cost, power cost and the RMB appreciation,” said Ji Jianyi, vice president of the company.

    However, the company invested large amounts of money on “clean manufacturing” under such circumstances and became the city’s first industrial park to pass the ecological manufacturing examination.

    High costs

    Ji said the cost of iron and steel had risen sharply over recent years, these make up 80 percent of the company’s raw materials. “For example, although demand for steel dropped recently, the price increased by 20 percent in June compared with the same period last year,” he said.

    According to statistics, the average salary of the company’s workers this year increased by 58 percent over 2009, while increasing shipping expenses and the appreciation of the RMB also affected the company’s profits.

    However, under such circumstances, the company invested 16 million yuan on building a “clean manufacturing” system. In just one year, the company saved 736 tons of coal and 60,000 tons of water, while emissions of sulfur dioxide and carbon dioxide reduced by 74 tons and 1,491 tons respectively. The system helps the company save about 26.5 million yuan a year.

    “The system applies advanced manufacturing method which uses the minimum amount of resources and causes the minimum amount of pollution. We want to promote it in the industrial park because it can not only help us save money but can also promote industrial transformation,” said Ji Aishi, president of the group.

    An ‘expensive’ bill

    The group will invest 330 million yuan on a foundry project, 120 million yuan on a vehicle gear project and 120 million yuan on a chassis project by 2015. During the process, the company plans to solve several pollution problems such as noise, dust and smoke pollution.

    The company first introduced the system on its foundry technique project in 2007 and saved about 9 million yuan a year. It will also introduce its high-end products to overseas markets in the future. “The system can not only lower costs but can also improve our equipment, technology and management level, so we can have stronger competitiveness in the global market,” said Ji.

    The system will be introduced to other companies in the city. By 2015, the city will build 10 model industrial parks for “clean manufacturing” to promote industrial transformation and upgrading.

(Wang Yuanyuan, Lin Gang)