It's been only several weeks since the officials of Turkish group Arcelik arrived at Arctic, but they have already reached several decisions bound to make a spectacular impact on the Gaesti-based plant and on the Romanian market of household appliances.
As of next year, the company's production capacity will double, enabling Arctic to charge new market segments under its own brand. The integration of the production and sales systems of Arctic and Arcelik will become apparent this month, when the Romanian market will see the first Arctic washing machines and cooking stoves made in Turkey.
The Romanian plant will return the favour, as it is slated to start making BEKO refrigerators. BEKO is Arcelik's traditional brand for household appliances.
"Arctic will increase production capacity to almost 800,000 refrigerating appliances by the end of next year, up from 350,000. We are also planning to gain 10% of the domestic market of washing machines in 2003. In fact, next year will lay the groundwork for Arctic to log 80 million-dollar sales in 2004," Ovidiu DAâsmban, Arctic Gaesti financial manager told Ziarul Financiar.
Arctic is likely to report revenues worth 50 million dollars this year. According to DAâsmban, the decision to expand the production capacity comes at a perfect time for equipment acquisitions from the international markets.
"Big groups have gone bankrupt (i.e. Moulinex) and others are cash-strapped, so they will put up for sale perfectly good production lines. Arcelik is thinking about buying these lines and install them at Gaesti. It's true the equipment is used, but it can operate for at least another ten years, in perfect quality conditions," DAâsmban says.
Arcelik bought Arctic last month, by a public takeover offer that was launched on the Bucharest Stock Exchange. The offer was subscribed by the company's four significant shareholders (the European Bank for Reconstruction and Development and three investment funds) and Arcelik bought 91% in Arctic for almost 18 million dollars.
The Turks are in for another pleasant surprise at Gaesti, besides the perfect timing for equipment acquisitions: Arctic will end the year with two million dollars in profit, after several years when revenues hardly managed to keep up with expenses.
Arctic has claimed 50% of the refrigerators market this year, after domestic market sales soared.
"We have sold 150,000 refrigerators on the Romanian market this year, up from the 108,000 units we sold in 2001," DAâsmban maintains.
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