Krauss-Maffei Kunststofftechnik GmbH has tentative plans to set up its first Chinese factory for manufacturing injection presses, aiming to boost its presence in the Asian market, said one of the company's top executives for China.
No final decisions have been made, but the company probably will set up a plant in eastern China to make its standardized machines, keeping the expertise for its higher-technology equipment like multicomponent molding or in-mold compounding at its German headquarters, said Michael Muller, vice president-China for Krauss-Maffei's injection molding unit.
``We have very detailed and precise plans to manufacture injection molding machines in China,'' he said. However, he declined to provide specifics until a final decision is made.
``The long-term plans are large-scale production,'' he added.
Munich, Germany-based Krauss- Maffei currently makes extruders at a factory in Jiaxing, near Shanghai. Muller would not say if the injection plant will be there as well.
He spoke in an interview at the China Dongguan International Plastics, Packaging, Rubber, Diecasting and Foundry Exhibition, held Nov. 8-11 in Dongguan.
The company sees the factory as a way to build market share in Asia and expand into new markets, and not, at least initially, as a way to shift manufacturing from Europe to China, he said.
But executives have not ruled out moving manufacturing for all of its standardized machines to China in the long term, he said.
``We will not transfer a lot of production from Munich to China in the next years [as] we want to create new markets [in Asia],'' Muller said. ``Long term, the possibility exists to transfer standard machine production to China.''
Krauss-Maffei did not set up a direct office in China until 2001, lagging some of its competitors, but since has made up for any lost time.
China is now its third-largest market for injection machines, purchasing 100 presses a year, Muller said. Its injection unit employs 30 in three offices, in Beijing, Shanghai and Shenzhen.
The company sells its full range of machines in China, with clamping forces of 50-4,000 tons, and is finding that the local appetite for the best, world-scale technology is growing in the country, he said. Its key markets in China include electronic components, automotive and medical packaging.
Krauss machines are three to five times the cost of locally made presses, but Muller said they are gaining popularity with Chinese firms that are more interested in equipment that lasts longer and offers better performance.
The Chinese factory will let the company reduce lead times and provide better service in Asia, he said, adding that the proposed plant is not just a way to reduce costs. Krauss-Maffei has said that it will not accept lower quality on made-in-China machines, even if intially it costs the firm more to produce them there than in Germany, he said.
Demag Plastics Group, a sister company of Krauss-Maffei, is building a 100,000-square-foot injection molding machine factory in Ningbo, China.