Workers at Doosan Infracore’s excavator production line in China. The company, along with another Doosan Group subsidiary, Doosan Heavy Industries and Construction, is successfully exploiting business opportunities in China. (Credit Photo @ Korea Times )
Doosan Group, which is gaining a global presence in machinery, heavy equipment, power generators and desalination plants, is ready to bet its business future on the growing Chinese market. This has the conglomerate exploring more opportunities to build partnerships with Chinese domestic companies and spend more on its corporate social responsibility (CSR) efforts to improve its reputation, as it looks to benefit from getting early out of the gate. Spearheading the efforts are the group’s main affiliates ― Doosan Heavy Industries and Construction and Doosan Infracore. Doosan Heavy is strengthening its position in the global market for power plants and desalination facilities, while Doosan Infracore has a stellar reputation for heavy equipment. “China is emerging as our key market and manufacturing location. We will stay aggressive in China, which is critical to maintain our corporate growth,” senior group official Shin Dong-gyu sai. The group is backing their words with action. Doosan Infracore recently set up a joint venture with Xuzhou Construction Machinery Group to produce diesel engines in China, which will allow it to better infiltrate the local market. The two companies will combine to invest about 125 billion won ($110.5 million) in Xuzhou Xugong Doosan Engine, which will produce 100,000 units of diesel engines a year by 2018, company officials said. The diesel engines are used in construction equipment, large-sized trucks and power generators.“We will do more to recruit local talent and build more partnerships with leading Chinese equipment makers, which will be crucial in designing our local strategy,” Shin said. The company also expects to sell fuel-saving hybrid excavators from 2011 in China, a market segment where it will have to compete with larger rivals such as Caterpillar for market supremacy.Doosan Heavy is also focusing on expanding its China reach. The company is planning to invest an additional 700 billion won by 2013 to jolt its green-tech-related projects in China, while also predicting a growing demand for nuclear power plant equipment there. The company is determined to unearth “hidden” cash cows in China, and is tapping the markets for power generators, biogas, which refers to a gas made from anaerobic digestion of agricultural and animal waste, and other green technologies. The company posted an operating profit of 63.2 billion won for the first-quarter of this year, compared to the loss of 92.9 billion won during the same period last year. `The second quarter will be better. We are receiving more excavator orders thanks to improving macroeconomic conditions. Our power plant-related businesses are also looking good,” said a Doosan Heavy spokesman.
Source : The Korea Times