Gandhinagar, India — Growing business in India is prompting German thermoforming equipment maker Illig Maschinenbau GmbH to move to a larger factory in the country.
In an interview at the Plastindia 2018 trade fair, held Feb. 7-12, an executive with the company said it plans to construct a new facility in the southern city of Bengaluru, also known as Bangalore, after first opening a plant there in 2015.
"We are now hiking our involvement with Indian clientele and moving to a bigger assembly operation," said Hans-Peter Roth, director of production at the Heilbronn, Germany-based firm.
He said the Indian packaging industry is growing 10 to 15 percent a year.
Roth said the firm has already bought a new location and construction work is likely to begin next year, as it applies for necessary approvals with local authorities. He said it hopes to open the new 160,000-square-foot facility by the end of 2019 or early 2020.
He said the company chose Bengaluru because of availability of skilled labor and proximity to Southeast Asia and the Middle East. It prefers India for its assembly operation over China, where it has no manufacturing facility, although it does have an application, training, service and sales center there, company executives said.
"The idea is to spread out in the whole South Asian region from the India operation," said Oliver Wolf, director of sales and marketing.
Bringing its manufacturing costs in line with India's price-sensitive market is a part of the reason for expanding, Wolf said: "We are expensive and that is the reason of manufacturing locally."
The company continues to supply critical components to the India factory from Germany, but hopes to develop its local vendor base.