What is the size of Carrier’s investment in the new plant you are opening in Sri City?
This is a $100 million investment. We want the facility up and running by the end of next year. If you look at what’s happening in India, it has truly become a hyper-growth market. Our growth rate in India has exceeded 20 per cent over the past four years, and we were up 33 per cent in the first quarter.
However, we need more capacity — especially for the high-end chillers we produce for data centres and large commercial office buildings. We already have a strong facility in Gurugram, a joint venture (JV) facility in Pune, and exceptional technical talent in Hyderabad and Bengaluru. Still, we needed a brand-new, state-of-the-art manufacturing facility to keep pace with this hyper-growth market.
So, we are building this facility in Sri City. It will serve not only as a manufacturing centre of excellence but also help us expand our supply chain fourfold over the next five years. We couldn’t be more excited about it.
Will you look at manufacturing for other markets as well from this facility?
We also intend to export to other markets. One of the key advantages of Sri City is that it is within 100 kilometres of five ports. This gives us a strong opportunity to export. Our primary focus will initially be India, but we also see potential in countries across Africa and West Asia. We will start there and then evaluate further expansion opportunities over time.
Is India Carrier’s fastest-growing market?
It has been our fastest-growing market. Over the past four years, India has consistently delivered the highest growth rates. One of the internal discussions we’ve had is that we try not to think of India in terms of year-on-year percentage growth. Instead, we think in terms of multiples — how do we achieve 2x or 3x growth in a country like India?
The opportunity is considerable. When you look at areas like data centre and hyperscaler discussing investments of around $50 billion — even from just a handful of players — you begin to see the scale. India is expected to grow from 1 gigawatt (Gw) to 10 Gw in the coming years, and typically, 1 Gw represents about $50 billion in spending.
So, rather than thinking about 10 per cent or 20 per cent growth, we focus on doubling or trebling the business. This is one of the reasons we are making this $100 million investment in Sri City, as we see a very unique growth opportunity here.
Today, including our JV partner, we have close to 5,000 colleagues in India, and we expect that number to grow to around 6,500 over the next four years.
When will India be among Carrier’s top five markets in terms of revenue?
It will become so in the relatively near future. Today, it is probably about $500 million on a base of $22 billion. With the kind of growth rates we are seeing, we believe there is a strong opportunity for it to become one of our larger markets.
Will India be a $1 billion market over the next five years?
There is no reason we should not reach $1 billion in sales. We expect to get there by the end of this decade.
With the Sri City plant, will all your HVAC (heating, ventilation, and air conditioning) manufacturing move to India?
It does change things considerably. The way I would think about it is that nearly all the commercial products we sell in India will be made in India. There may be a small portion that we import, as we still need to develop test lab capabilities for some product lines in the chiller market. However, the lion’s share of what we sell in India will be manufactured and assembled locally.
While some components will continue to be imported, one of our key objectives is to localise as much of the supply chain as possible.
Would you look at India eventually as one of your main manufacturing hubs?
I think India will certainly be one of our main manufacturing hubs. We view it as a centre of excellence. For certain chillers, it will be a key hub. When you look at our global engineering workforce, India is already one of our centres of excellence. In Hyderabad, for example, across both engineering and digital functions, we have taken a platform approach — much of our global electronics design is done there.
It will clearly be a key manufacturing hub. Initially, it will primarily focus on the Indian market, as the market is highly attractive. Over time, we will evaluate its role as a regional manufacturing hub and then take stock. There is a lot to like: a strong workforce, which we have experienced for many years in Gurugram. Carrier was one of the first, if not the first, in our industry to invest in manufacturing in India, beginning over 40 years ago, and we have seen great success with the workforce.
This is an end-to-end value chain — not just manufacturing, but also the entire ecosystem, including supply chain, design, aftermarket support, and digital support. There is no reason this cannot become one of our more significant global manufacturing hubs.
 "David L Gitlin, chairman and chief executive officer, Carrier Global")