Thai plan for infrastructure mega-projects further lifts prospects of Finland-based Kone
Finland-based Kone, a global leader in the elevator and escalator industry, has strong confidence that the Southeast Asian market will grow more quickly when the Asean Economic Community (AEC) takes effect in 2015.
This will be especially so in Thailand, where the government plans an infrastructure mega-project worth Bt2 trillion that will boost the demand for elevators and escalators in this region, the company’s executive vice president and area director for Asia-Pacific and the Middle East, Noud Veeger, told a news conference yesterday.
At present, Kone is ranked second in the global market with an 18-per-cent share of the total market volume 670,000 elevator and escalator units annually. This is up from the No 3 just three years ago.
“We expect to be market leader in the future by focusing on innovative products,” he said.
Yesterday at Marina Bay Sands in Singapore, the company introduced a technology it calls Kone UltraRope.
This is a completely new hoisting technology that eliminates the disadvantages of conventional steel rope and opens up a world of possibilities the high-rise building design, the company claims. It can reduce energy consumption by up to 35 per cent compared with steel rope.
Demand for elevators and escalators in China now accounts for about 65 per cent of the global total of 670,000 units a year.
It is followed by Europe, the Middle East and Africa (EMEA) at 17 per cent, Japan and Korea at 4 per cent, the rest of the Asia-Pacific region at 8 per cent, and North and South America at 3 per cent each.
Demand in Southeast Asia and the Middle East is about 75,000 units a year.
Veeger said demand in the Asean market was growing faster as development of hotels and residential, commercial and public buildings expanded.
“We cannot [predict] the growth figures, but this region will show strong growth when the AEC becomes effective in 2015,” he said.
The Asia-Pacific region accounted for 35 per cent of Kone’s sales at 6.3 billion euros (Bt266 billion) last year, up from 27 per cent in 2011, putting the region in second place after EMEA, which recorded 49 per cent, down from 55 per cent the year before. The Americas accounted for 16 per cent in 2012, down from 18 per cent.
The fastest sales growth in the Asia-Pacific region is in China and India, he said.
Currently, Kone has two production plants in the Asia-Pacific region, in Kunshan, China, and in India. They are its production hubs for Asia sales.
“We have no plan to expand our production capacity now because our two plants in China and India have the capacity to support the demand in the Asia-Pacific market.
“However, if we need to expand our production capacity in the future, we will eye investing in Southeast Asia, because this region shows strong demand compared with other regions. But we cannot give more details about when and where at this time,” he said.