India undercuts China to land third Gamesa turbine factory

May 04, 2012

Gamesa Corp. Tecnologica SA, Europe’s second-biggest wind-turbine maker, is taking advantage of manufacturing costs even below those of China to open a third factory in India.

Bloomberg today quoted Ramesh Kymal, head of the Spanish company’s Indian unit, as saying that Gamesa will build a 2 billion-rupee (USD37 million) plant in southern Chennai to produce its new 2-MW machines.

He said the site will get 70 percent of its supplies locally by year-end, driving down output costs by 18 percent.

Competition among turbine makers in China has grown amid a supply glut, putting pressure on prices as manufacturers seek to contain costs. India has now become the wind industry’s largest growth market by volume after China tightened project approvals and Europe and the US reined in financing amid burgeoning debt, the Global Wind Energy Council said last month.

Gamesa, which already produces turbine blades and towers at two plants in India, landed 20 percent of its sales in the country last year and expects that share to climb, targeting 711-MW in sales by the end of December, Kymal said. Recent orders include a 150-MW contract from Mytrah Energy Ltd. (MYT), part of a 2011 accord to buy 2,000-MW of machines from Gamesa by 2016.