Produces machines 40% cheaper than Europe.
Biesse Manufacturing, Italy-based wood working machinery company, has invested Euro 4.5 million (about Rs 30 crore) to set up a manufacturing plant in Bangalore. The plant, located at Nelamangala on a three acre land, will manufacture wood working machines for both domestic and export markets in addition to importing parts and assembling high-end machines.
Addressing a press conference here, Stefano Bartolini, industrial director, Biesse Manufacturing, said, “Our investment in India is strategic in nature with a long term future in the region. This initiative is part of the 2008-2010 Biesse industrial plan and this plant in India allows the group to supply machinery and spare parts to the Asian and Middle East markets.”
“The Indian plant will be scaled-up shortly to facilitate product development and for providing technical know-how in the regional markets,” he added. To begin with, Biesse Manufacturing will manufacture three types of machines - ‘Edge banding machines’, ‘CNC (computer numerical control) machining’ and ‘Beam saw machines’ in India. In the first year (2008), it plans to manufacture 50 machines, in second year (2009) 180 machines and in the third year (2010) 280 machines.
The company, before setting up its permanent plant at Nelamangala, was operating from a temporary unit in Yeshwantpur.
Sayeed Ahmed, chief executive officer, Biesse Manufacturing-India, said, “Through this temporary unit, we were assembling machines by importing from Italy and installing at client locations in India, Singapore, and Middle East. In one year, we were able to identify and localise 50 per cent of electrical needs and 90 per cent of mechanical components going into wood working machines by identifying local component suppliers,” he added.
Stefano Bottene, sales director Biesse Manufacturing based in India said, “Through these component suppliers, we have managed to produce machines 40 per cent cheaper than Europe. The main factor for low cost is cheap labour.”
Biesse Manufacturing, for sourcing components locally, has identified about 1,500 suppliers of which 150 have begun to supply components and are spread across Bangalore, Chennai, Coimbatore, Pune, Gurgaon and Ahmedabad.
The company’s Indian investment is also to identify suppliers of critical components and explore possibilities of sourcing raw materials and parts needed for the construction of high-end machines.
Bottene, said, “With lower manufacturing costs in India we are able to produce and sell semi-automatic machines at around Rs 2 lakh and high-end ones upwards of Rs 50 lakh.”
As part of its corporate social responsibility (CSR) initiative, the company has donated Rs 50 lakh worth of ‘CNC machining’ to Advanced Wood Working Centre located at Indian Institute of Wood Sciences, Bangalore. This initiative is mainly to train young people to take up career in wood working or carpentry, he added.