Haier to set up two units

Chinese white goods major Haier will invest $200 million in India over the next four years to set up an integrated manufacturing facility, a factory exclusively to manufacture refrigerators and, a research and development centre.

It plans to be among the top three white goods companies in India in the next 5-7 years.

"The R&D centre will be set up two years from now, the integrated manufacturing facility will be set up in three years and the refrigerator manufacturing facility in the fourth year," said T K Banerjee, chairman and managing director of Haier India, the Indian subsidiary.

The company launched its range of home appliances and consumer electronics products in north India in January 2004. On Monday, it launched its range in Gujarat and plans to cover the whole country in the next 2-3 months.

Haier is looking at a turnover of Rs 300 crore (Rs 3 billion) by the end of the current year through sales of 500,000 units of white goods.

"We will first build the brand. We will continue to import high-end products, but source low-end products from local manufacturers in the first couple of years," Banerjee said.

He said that in the next five years, the white goods market in India will be worth $5 billion and Haier aims to garner $1 billion of that.

"India will emerge as one of the key markets for the group down the line and sales here will constitute 7-10 per cent of our global sales," he said.

Banerjee said several state governments were in talks with the company for setting up the three facilities, but locations have not been finalised as yet.

"Gujarat and Maharashtra are definitely ahead of others, but it is not necessary that all the three facilities will be in one state," Banerjee said.

On the pricing of products, he said Haier will not involve itself in any price war. "Our positioning will be of best products at affordable prices. For example, the refrigerator range will begin at Rs 8,000 for a 180 litre model and the price will go beyond Rs 100,000 for the high-end model."

The company has also for the first time introduced bottom-mounted refrigerators, where the freezer is at the bottom. The model will cost Rs 29,000. And its new technology "double drive" washing machine will reduce the time taken to complete the clothes washing cycle by half.

Banerjee said the company's dealer and distributor network, which currently stands at 450, will be increased to 2,000 this year and doubled next year.

The Haier group was set up in 1984 in the Quingdao province of China. It and has emerged as a top multinational with a portfolio of 13,000 products and manufacturing units in 13 countries including the US, EU, Middle East, Africa and South Asia.  This is apart from its robust presence in China.