Arçelik to increase China plant capacity
(Saturday, December 8, 2007 ISTANBUL - TDN with wire dispatches)
Arçelik, Turkey's largest producer of household appliances, is planning to expand the capacity of its washing machine factory in China as it seeks to boost exports to the United States, Bloomberg reported, citing Milliyet daily.
Arçelik started production at its China plant Wednesday after buying Shanghai-based Changzhou Casa Shinco Electrical Appliances Co. Ltd. for $8 million in July. Arçelik opened the production facility after it had registered the company name as BEKO Electrical Appliances Co. Ltd. and renewed the company with additional investments worth $2 million, Milliyet reported. The factory has an annual capacity of 200,000 units. Koç Holding aims to expand the factory with an investment of $15 million.
The Istanbul-based Arçelik will increase the annual capacity fivefold to 1 million units, reported the daily Milliyet. Sales in China will be about 100 million euros ($146 million) this year, said Chief Executive Officer Aka Gündüz Özdemir at a press conference prior to the opening ceremony of the factory.
China has an annual growth of 8-10 percent and is one of the world's largest economies, said Koç Holding Board Chairman Mustafa Koç.
“China is a very big and difficult market. Giant companies, such as Ford, General Motors, Siemens and Wal-Mart, which were prepared to lose money for a long time and to consolidate the damages, started to earn money after a while. However, this market cannot be disregarded.

Arçelik sales points:
BEKO is the international brand of Arçelik, said Özdemir. “We believe that we have turned Arçelik into an international company. However, this is not enough. We will become a global company,” he said, adding that Arçelik set a target of 6 billion euros for 2010. For approximately 10 years, the company has been dealing with acquisitions and transit trade in China. Trade volume there will have reached 100 million euros at the end of 2007, Özdemir said.
“We know that in about three years, China will have a very important place within the company's strategic growth plans,” Özdemir said. The company negotiated here in Turkey with 13 committees from several regions, said Özdemir, adding, “we eventually selected this place. It is the heart of this industry in China, and our international rivals are here. This place will constitute important inputs for our factories in Turkey, Russia and Romania. It is important for us in terms of growth as well. We aim to sell products particularly to Asia Pacific region and the United States from here.”
In the Chinese market, Arçelik offers its BEKO-branded products and services in 12 cities at approximately 90 locations. There will be 100 sales points in China by the end of the year, said Özdemir.

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