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ABB pins hopes on stimulus package
By Fu Chenghao |
May 13, 2009, Wednesday
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Print Edition
Print Edition
ENGINEERING group ABB said yesterday it will invest US$150 million in China this year to expand and develop facilities on expectation that the nation's stimulus package will boost demand.
"Despite the current global financial crisis, I believe demand for ABB's technologies to improve industrial productivity, energy efficiency and grid reliability will only grow," CEO Joe Hogan said.
ABB, which provides power and automation equipment to energy utilities and other industrial customers, had invested US$1 billion in China by the end of last year.
The Swiss company yesterday inaugurated a new multi-business manufacturing facility, ABB Engineering (Shanghai) Ltd, in Pudong New Area, which tripled the size of the unit's previous site and will double ABB's robot manufacturing capacity in China.
It plans to expand six other sites across China this year.
In April, ABB announced a global cost-saving target of US$2 billion after reporting a 16 percent drop in first-quarter orders. Still, Hogan said China's stimulus package, which includes heavy spending on power grid expansion, is by far the world's biggest and fastest and could give the group a boost.
ABB is also well positioned to benefit from increasing efforts by customers aiming to become more efficient by buying new motors and drives. Hogan said annual savings from replacing inefficient motors in the Chinese industry could reach 19 billion kilowatt hours, or the power consumption of millions of households. Electric motors account for 65 percent of power consumed by industrial users, he said.
ABB boosted sales in China, its biggest market, to US$4.1 billion last year, about 12 percent of its global total of US$35 billion.
"Despite the current global financial crisis, I believe demand for ABB's technologies to improve industrial productivity, energy efficiency and grid reliability will only grow," CEO Joe Hogan said.
ABB, which provides power and automation equipment to energy utilities and other industrial customers, had invested US$1 billion in China by the end of last year.
The Swiss company yesterday inaugurated a new multi-business manufacturing facility, ABB Engineering (Shanghai) Ltd, in Pudong New Area, which tripled the size of the unit's previous site and will double ABB's robot manufacturing capacity in China.
It plans to expand six other sites across China this year.
In April, ABB announced a global cost-saving target of US$2 billion after reporting a 16 percent drop in first-quarter orders. Still, Hogan said China's stimulus package, which includes heavy spending on power grid expansion, is by far the world's biggest and fastest and could give the group a boost.
ABB is also well positioned to benefit from increasing efforts by customers aiming to become more efficient by buying new motors and drives. Hogan said annual savings from replacing inefficient motors in the Chinese industry could reach 19 billion kilowatt hours, or the power consumption of millions of households. Electric motors account for 65 percent of power consumed by industrial users, he said.
ABB boosted sales in China, its biggest market, to US$4.1 billion last year, about 12 percent of its global total of US$35 billion.
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