Keller supply company sells equipment to military for military uses
KELSON, New Zealand — It’s the end of an era for the former Keller plant in central Auckland.
For more than 30 years, the world’s largest contract manufacturer for military equipment has been turning out weapons systems for the United States military and its allies in the Middle East.
But that was before Keller got into the arms race with a new competitor: a Chinese company, Shenyang Semiconductor, which it bought last year for $2.6 billion.
Shenyang, a joint venture of the Chinese and U.S. military, is now supplying parts for the Chinese military, according to people familiar with the matter.
Shenyang is already a customer for Keller, but the Chinese firm has also contracted with other U.N. agencies and has been building up its workforce in New Zealand.
The Shenyang deal is likely to fuel growing competition for the New Zealand arm of the company, as its business in the arms industry, known as semiconductor manufacturing, expands and as the country is grappling with an ageing workforce and its shrinking population.
It’s not the first time New Zealand has seen a big military contractor in competition with its own technology.
The Chinese state-owned shipbuilding company Shenyang purchased the New Plymouth Naval Shipyard in 2007 for $1.4 billion, a deal that was followed by a separate deal with the New England Maritime Authority in 2011.
New Plymouth was eventually renamed the Portsmouth Naval Shipyards, and both are now owned by the British government.
In recent years, New Plymouth’s business in manufacturing weapons has also been disrupted by the arrival of Chinese firms, including the Chinese manufacturer Precision Machinery.
The company also manufactures components for the U.K. military and for the European Union.
The British government also recently paid a record $2 billion for Precision Machineries’ New Zealand headquarters, and has said it plans to buy all of the plant’s equipment.
The New Plymouth plant is one of a handful of U.W. and British government-owned weapons production facilities, many of them in Auckland, that have been hit by a surge in Chinese activity.
But it has not been the only one.
New Zealand’s weapons manufacturing sector is already growing at a faster pace than the rest of the country’s, according, to the U and UW-backed New Zealand Defense Industry Council, a group of industry and government representatives.
The council estimates that between 2013 and 2016 the New World War II-era weapons plant grew by 4 percent annually.
The council also projects a 7.8 percent growth for the next two years, with manufacturing for the new weapons system being built at New Plymouth and in other sites around New Zealand and in the United Kingdom.
That’s expected to add to the countrys arms manufacturing capabilities in coming years.
Siemens contract with the U to build a new military air-defense system is also expected to increase production and expand its capabilities, according the council.
That contract is valued at $4 billion and the council estimates the total potential value of the contract at $9 billion.
The new military system will be a joint project between the U., Japan and South Korea.
The U. and South Korean governments have said it will be the worlds largest-ever defense deal, and that it will include more than $2 trillion in funding for the country.
China has been involved in several arms projects in New England, including a $1 billion contract in 2012 for a military air defense system in New Plymouth.
The New Plymouth contract was not awarded and was terminated, according a government statement.
China also is a major customer for New Zealand’s civilian nuclear program, which is led by the National Nuclear Security Administration.
The contract was for four years and will be paid off by the end