Demand grows in China for UGS’s PLM software

UGS, the US-based provider of “product lifecycle management” software, is seeing sales grow by 25 per cent a year in China as local companies increasingly adopt PLM to strengthen their design, manufacturing and sales operations.

Tony Affuso, UGS chairman and chief executive, said the former unit of Electronic Data Systems had already established customers in China’s automotive and home goods sectors, and was beginning to develop other design and collaboration-intensive industries such as apparel manufacturers.

“In China the biggest challenge is keeping up with the growth,” Mr Affuso said.

Mr Affuso gave no details of China sales but said the country was currently the second-largest Asia-Pacific market for UGS after Japan and that the region accounted for about 20 per cent of the software company’s $1bn global revenues.

PLM is a class of software that has developed from computer-aided design products that allow designers to work together on digital plans of new products.

PLM extends the use of product simulations created by designers so that they can be used to share information with parts suppliers, factory engineers and even sales staff and packaging producers, wherever they may be located.

The Chinese market for PLM, currently estimated at slightly under $200m a year, would in future be fuelled by an increasing role for local companies in industrial design, he said.

Introduced first by companies such as aircraft and car manufacturers with highly complex design processes and supply chains, PLM is also winning converts in more mundane sectors such as textiles.

Chinese companies that increasingly compete directly with established foreign rivals are keen to adopt such products to make their increasingly international operations more efficient.

UGS is moving to raise its profile with Chinese customers by stepping up donations of software to local universities and colleagues, included a grant of PLM products that would be commercially priced at $1.1bn to be announced this week.

Mr Affuso said UGS was not deterred by the weakness of Chinese protections for intellectual property.