Fast-growing demand for automation in China is maxing out the production capacity of robot maker Alfa Automation Machinery Co. Ltd.
The company finished a major expansion in Suzhou just one year ago. With sales jumping 50 percent in the first quarter, Taipei, Taiwan-based Alfa said the brisk growth rate will continue into the next few years.
The company reacted quickly to the heated market and recently purchased 10 acres of land in Suzhou and 5 acres in Dongguan for further expansion, General Manager James Huang said at Chinaplas, held May 21-24 in Guangzhou.
Alfa's existing plant in Dongguan features 20,000 square feet of manufacturing space and employs 350. The plant in Suzhou measures 42,000 square feet and houses 200 workers. Alfa also runs a plant in Taiwan with a staff of 60. Huang said the Dongguan plant remains the major production site, with its output twice as large as that of the Suzhou plant and three times of its plant in Taoyuan, Taiwan.
The most recent round of expansion plans to start production in April 2008, Huang said.
``Customers come to us complaining the rising wages in Guangdong, Jiangsu and Zhejiang. Nowadays you need to pay 1,800 yuan (US$236) a month to retain an injection operation worker in Dongguan,'' Huang said. In the meantime, plastic processors continue to have a difficult time filling openings, as ``older migrant workers go home and stay, and fewer young people from inland choose to leave their hometown and work in factories,'' he said.
Alfa also has made strides to tap into the often-overlooked market in northern China. Last year alone, it opened seven sales and service offices in Beijing, Tianjin, Dalian, Changchun, Shenyang, Qingdao and Weihai. ``[North and northeast China] is our fastest-growing region,'' Huang said.
Huang said sales measured by units already have surpassed its main competitors - Japanese robot makers - but the money value is still lower. Major players from Japan, such as Yushin Precision Equipment Co. Ltd. and Star Seiki Co. Ltd., already are manufacturing locally in China.
The firm invested $25 million in 2006 on new computer numerically controlled centers and started using them earlier this year. Its research and development team has grown to 20 people.
Alfa makes robots for presses from 15-4,000 metric tons and sells more than 90 percent of output in China, exporting the rest.
The privately held company reported sales of US$30 million in its 2006 fiscal year.