To invest €10 million in the facility by 2012
MUMBAI: Wartsila Corp, a Finland-based equipment and turnkey solutions provider, has identified India as the sourcing hub for its global needs.
The company plans to convert its Khopoli facility in Maharashtra into a global manufacturing and sourcing unit by 2012.
Lars Hellberg, group vice president and head of industrial operations, Wartsila Corp, said the Khopoli plant has one of the best facilities in the world.
"By making it our global site we will also have the advantage of being very close to a major demand region," he added.
In the last few years, Wartsila India has invested around €10 million in its Khopoli unit and plans to invest an equal amount by 2012.
Hellberg said, "We are looking at a stronger supply chain in the country by tying up with more global suppliers here." Currently, the company has three global suppliers operating in India.
The company has three main divisions here — shipping equipment, power plant and services. The services division contributes 40% to its revenues, with power plant and shipping divisions contributing 30% each.
Wartsila recently started its fourth worldwide division of industrial operations in India.
Under this division, the company launched a new auxiliary manufacturing unit at Khopoli to cater to its global needs.
Rakesh Sarin, managing director, Wartsila India, said the new unit is an extension of the company's earlier auxiliary facility commissioned in 2004. "The earlier unit was catering to a smaller base but will now supply to our global customers also," he said.
K K Pant, vice president (industrial operations), Wartsila India, said the company chose Khopoli as labour there was cheaper compared with that in the Netherlands and Norway, where the parent company has manufacturing facilities.
Currently, Wartsila India supplies balance of plant (BoP) equipment and other products such as gear boxes, oil distribution boxes and other auxiliary equipment.
Sarin said, "Our products are meant for high-efficiency operations and hence, we have the ability to add a lot of value to the current power generation developments taking place in the country."
He said the parent company's flagship product is engines, which is currently not being manufactured in India.
"After some years when the gas deficit is overcome and gas becomes a major driver of the industry, we will definitely bring it to India."
He added that the Indian subsidiary is also open to inorganic growth options and would be comfortable with any size as it has a healthy balance sheet.