MUMBAI (Updated) — Cincinnati-based Milacron LLC plans to invest $30 million over the next three years in India.
The investments will double capacity at Ferromatik Milacron India Pvt. Ltd.'s Ahmedabad plant, which currently makes injection and blow molding machinery, and will add production of extruders there.
It also includes a new Mold-Masters plant in Coimbatore, which will replace a leased facility.
Milacron is pumping fresh investment into India because its business has been growing more than 15 percent annually, according to President and CEO Tom Goeke.
“India is going to be the second-largest polymer processing market — after China — by 2020. Therefore, we are investing to meet the future demand that emanates from this growing market,” Goeke said in an interview in Mumbai.
Milacron has a “Made in India, for India” strategy, and doubling capacity means hiring more people.
“We are also planning to double the workforce from the current 1,200 people in various Indian locations to 2,400 in line with the expansion,” Goeke said. Milacron believes its biggest challenge in India is hiring and training the right people.
“We are not running the business on expats, but on local talent. And that is the reason [for our] success in the India market,” he said. The local team understands the requirements of the local market, he said.
The Ahmedabad plant currently makes about 1,500 injection and blow molding machines annually, ranging from 50-3,200 tons of clamping force.
“Our plan is to hike the production from 2,100 lines by mid-2015 to 3,000 units by 2016,” Goeke said.
Milacron has earmarked $20 million for the Ahmedabad expansion and $10 million for the Mold-Masters plant.
Mold-Masters employs 272 in India, including 130 engineers. The company plans to bring a shared service center to Coimbatore.
On the extrusion side, Ahmedabad initially will target the pipe sector, followed by profiles later. The expansion is driven by growth in infrastructure and construction spending in India.
“Initially, the focus would be [for the] India market, and later we will look for exports to Africa and Middle East,” Goeke said.
Ferromatik Milacron India currently exports about 30 percent of its output to Africa, the Middle East and the ASEAN region. Exports to the United States also have been on the increase, he said.
The announcement in India comes about three months after Milacron bought Tirad s.r.o., a precision machining company in Želetava, Czech Republic, which makes mold bases. Ron Kirsanda, Milacron's chief operating officer, said the company also has purchased land in the Czech Republic where it is building a factory to support growth in its European blow molding business. Milacron will operate in two separate Czech locations, in Želetava and Policka, where it will do machine assembly.
Goeke said another region where Milacron has plans is Southeast Asia, which he called “the most under-served market.”
“We are working on a plan to enhance our presence in Southeast Asia, especially in the markets of Thailand, Malaysia and Indonesia, which present immense growth opportunities. We are planning to open a sales and service center initially to support the customer base in these growing Asian markets,” Goeke said.
Meanwhile, Milacron also has been expanding in China. In April, at the Chinaplas trade fair in Shanghai, Goeke talked about how the company was spending between $4 million and $5 million to double capacity at its Jiangyin factory, to about 950 injection molding machines a year.
That expansion, which opened this summer, also included plans to begin manufacturing extrusion and blow molding equipment in Jiangyin.