Argillon GmbH Germany turned the production facility of Turda into the most important production facility of the three insulator plants the group owns internationally. From 1.3m-euro turnover in 2004, the firm in Cluj reached 12m-euro sales in 2007.
Argillon Romania, a manufacturer of medium and high-voltage porcelain insulators, part of Germany's Argillon GmbH, has invested around 10m euros in the past three years to boost the production capacities of its plant in Turda, with the plant currently producing 40,000 tonnes of insulators per year.
"We are in full expansion as we're currently using only 70% of the total capacity of the plant. Our intention is to keep investing in the development of the facility of Romania, since the plant in Turda is very important for the group's business, given that the other plants cannot produce some types of insulators because of the lack of equipment," Michael Heussen told ZF Transilvania.
According to the company's management, over 95% of production manufactured in Romania is currently exported, mainly to Europe and North America.
"We haven't been really interested in the domestic market so far because it's stagnated at a quite low level, particularly due to the energy industry instability generated by privatisations in progress or just completed.
"However, this is likely to change in the following period and the market could see rapid growth starting 2008," Heussen also said.
According to him, the global insulator market is following an upward trend amid rising investments in the energy field. "Power consumption is rising each year and, under the circumstances, the electrical equipment plants in the so-called low cost countries have an important role given that they can provide cheaper production solutions," Argillon GmbH CEO stated.
He also said that owning the plant in Turda, Argillon can face competition from China and India given that, besides the low costs, the Romanian production facility has no quality or delivery deadline problems.
Argillon Romania will reach 12m-euro turnover during the fiscal year 2006-2007, after in 2004, when it was taken over, its turnover did not exceed 1.3m euros.
The Germans in 2004 invested around 300,000 euros in production capacities.
Michael Heussen took over the company's management this February, replacing Danut Pop. In the following months of this year, the general manager position will be taken over by a domestic manager, Sorin Nutiu.
Currently, the German group has KKR US investment group as its majority shareholder, which has voiced its intention to sell the business to another investor, though. However, the development strategy for the plant of Romania is unlikely to change, says Argillon GmbH CEO.
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