RPT-UPDATE 1-Moog sees China sales more than doubling in 2-3 yrs

* Moog sees annual China sales more than doubling in 2-3 yrs

* Moog sees potential in China's auto industry (Repeats with Update tag) (Adds details, quotes)

By Fang Yan

SHANGHAI, March 13 (Reuters) - Moog Inc (MOGa.N) (MOGb.N), which makes precision parts for aircraft and industrial systems, expects to more than double its annual sales in China in two to three years, helped by robust demand in the fast-growing economy.

Moog sees great potential in China, where the rapidly expanding power, steel and automotive industries have pushed up demand for precision control and other industrial components, Lars Rasmussen, Moog's regional manager in China, told Reuters in an interview.

"Our growth rate here has been anywhere between 30 to 40 percent averaged out in the last five years and I don't see any reason why that will not continue," Rasmussen said.

China sales are estimated to increase to about $45 million in the 2008 fiscal year ending on Sept. 30, up from around $35 million a year earlier, said Rasmussen, a Denmark native who joined the U.S. firm in 1993.

To help keep up its momentum, Moog, which makes servovalves, actuators and other components for power and steel production equipment in a plant on the outskirts of Shanghai, is expanding the facility's product line and would consider adding more greenfield facilities in the future, he added. Globally, Moog, which vies with Parker Hannifin (PH.N) and Siemens AG (SIEGn.DE), posted net sales of $1.56 billion in the last fiscal year, up nearly one-fifth from a year earlier.

AUTOMOTIVE POTENTIAL

Due to export restrictions by the U.S. government, Moog, whose products can be found in missiles, submarines and space shuttles, is counting mostly on the electric power and steel industries to drive its China sales.

Rasmussen, head of Moog's China and Hong Kong operations since 2006, said he also saw great potential in the automotive industry in China, where car sales grew 22 percent in 2007 to 6.30 million units.

Moog's automotive clients in the country are mostly local ventures of global heavyweights such as General Motors GM.N and Volkswagen AG (VOWG.DE).

It has been in talks with several local auto makers, such as Dongfeng Motor (0489.HK) and Chery Automobile, hoping to expand its clientele, which also includes Baosteel (600019.SS), the country's top steel mill, Rasmussen said.

He said his company planned to start making automotive test equipment in Shanghai later this year, catering to car makers' drive to improve safety and quality standards.

"Of all the markets I see in China, this may have the biggest potential," he added. (Reporting by Fang Yan; Editing by Edmund Klamann)