Chery has awarded Sapura Industrial Berhad an axle assembly contract worth an estimated RM307 million over four-and-a-half years, covering selected vehicles including the Jaecoo J5 and models under the Lepas brand.
The agreement covers front and rear axle systems for petrol, hybrid and battery electric vehicles (BEVs), forming part of Chery’s efforts to increase local content in its Malaysian operations.
Sapura Industrial’s wholly owned subsidiary, Sapura Machining Corporation Sdn Bhd, signed the master purchase agreement with Chery Corporate Malaysia on Nov 4.
Assembly will take place at Sapura Industrial’s new facility in Bukit Beruntung, Selangor, with operations expected to begin in the second half of the financial year ending Jan 31, 2027.
According to its Bursa Malaysia filing, Sapura Industrial has received two letters of award and expects to invest up to RM3.6 million in the programme.
The RM307 million represents estimated revenue over the contract period, subject to actual deliveries.
Sapura Industrial managing director Datuk Syed Izuan Syed Kamarulbahrin said the agreement marked the company’s first direct business relationship with Chery.
Chery Corporate Malaysia vice-president Cheng Namweng said local suppliers were central to the carmaker’s regional expansion plans, with the partnership supporting its longer-term manufacturing strategy.
