Johnson Controls International expects double digit growth rates for its China operations within the next one to three years despite concerns over a slowdown in the world’s second-largest economy.
Alex Molinaroli, chairman and CEO of the automotive parts maker, told CNBC at the sidelines of the World Economic Forum’s annual June meeting in Dalian, that he is bullish about China’s prospects.
“The ups and downs of China mean nothing compared to the rest of the world when you think about the growth rates, you think about the emerging middle class and you think about the clustering of the cities,” Molinaroli said. “It’s a perfect opportunity for Johnson Controls.”
He added, “I’d be really disappointed if we didn’t see strong double digit growth.”
China’s economy grew 6.9 percent annually in the first quarter, beating expectations, amid a government infrastructure spending spree and rising housing prices. Last year, the economy grew at 6.7 percent, which was the slowest pace of expansion in 26 years, but remained above the growth rates of most other countries.
Johnson Controls produces automotive parts such as batteries, and heating, ventilation, and air conditioning equipment for buildings. It has a substantial presence in China, including manufacturing plants, research and development facilities, branches and thousands of employees and channel partners.
Molinaroli explained that while there’s going to be fluctuations in growth rates, there will still be cars that are going to need batteries, air conditioning that will be required and security systems that are going to be more important to the emerging middle class in China.
“Migration from the east to the west and large cities — all these things fit to our strength. So when I look at the cycle that we’re in, I feel very confident about our position,” he said.