SEOUL, SOUTH KOREA — Austrian press maker Engel Holding GmbH is doubling capacity at its South Korean factory.
The company hopes to expand its market share in Asia, in part by capturing some of the precision electronics component manufacturing business currently dominated by the Japanese.
In a March 12 interview at the Koplas 2013 show in Seoul, the company's top Korean executive said the 8 million euro ($10.4 million) expansion of its Pyeongtaek factory will give it the capacity to manufacture 1,200 machines a year there.
It should take the firm three to five years to reach that level, up from the 650 machines it makes annually now in Pyeongtaek, said Robert Bodingbauer, president of Engel Machinery Korea Ltd.
Engel, based in Schwertberg, started making all-electric presses in Korea three years ago, and is targeting high-precision markets like electrical connectors, lenses and LED lighting for its growth, Bodingbauer said.
Those markets have historically been dominated by Japanese molding machinery suppliers, but the Austrian firm plans a major push, he said.
"A few years ago the Europeans had problems to match the technology of the Japanese," he said. "Now we have it.
"We have developed now at Engel and Engel Korea [various] electric machines, and we hope we can penetrate companies that are now using this technology, which is Japanese," he said. "We needed additional capacity to react fast."
The expansion in Korea also reflects the growing importance of Korean multinationals in Engel's customer base.
"This is what we didn't plan [when it opened the Korean factory a decade ago]," he said. "This is a very nice side effect, not only for the Korean factory but for Engel globally."
Engel claims to have 52 percent of the market share of European injection press makers in Asia, including India, but it would be hard to grow beyond that percentage, so it is targeting new markets like the precision connector molding industry, he said.
The company has been able to grow in Asia because the South Korean factory, and another in Shanghai, which it also expanded last year, give it the ability to ship machines quickly and deal with customers in local languages, Bodingbauer said.
Last year, Engel said its sales in Asia reached 100 million euros ($130 million), out of roughly 900 million euros ($1.2 billion) worldwide.
It invested 12 million euros in expanding its capacity in Shanghai, where it makes injection presses of 400 metric tons and larger. In Korea, it focuses on machines under 400 tonnes of clamping force.
The company is beefing up its presence throughout Asia, he said.
"We are getting more sales people in China. We have our own subsidiary in Thailand. We have been investing in Indonesia," he said. "India is also growing because Korea has a free trade agreement with India and Europe does not."
The Koplas trade fair, which is Korea's national plastics show, takes place from March 12-16.