By IANS,
Ahmedabad : Indian multi-product company city-based Electrotherm (India) Ltd plans to produce motors for electric vehicles in China after dropping plans to make induction furnaces in that country, the company said in a communication to its shareholders.
The company, which manufactures induction furnaces and other steel and foundry industry equipment, steel products and electric vehicles told shareholders that it prefers to export furnaces to China from its Indian operations instead of producing them there.
For this reason, it has surrendered the business licence it had secured to set up a factory in Bichen High Tech Industrial Park, Tianjin. For executing the project it had proposed to establish a subsidiary called Tianjin Electrotherm Induction Limited.
Tianjin is a large city in the Chinese northern coast with a provincial level status. The city’s urban area is the third largest in China after Shanghai and Beijing.
Electrotherm’s plants are located at Palodia on the outskirts of Ahmedabad city and at Samkhiyali in Kutch, about 400 kms from Ahmedabad, where in addition to a Rs.4.4 billion steel plant, it has rolling mills for TMT bars and structural sections and two sponge iron kilns.
For implementing the motors project, Electrotherm has floated a subsidiary Jinhua Indus Enterprises Limited.
The company has also promoted another subsidiary under the name Jinhua Jahari Enterprises Limited which will be responsible for inspection and sourcing of components for electric vehicles for sale to Electrotherm electrical vehicles division. Both the subsidiaries have started operations, the company said but provided no further details.
According to the company, the decision to produce electric motors in China has been taken as its electric vehicles division has overcome problems that cropped up in Yo Smart, a single seater electric bike.
The problems were three fold. Yo Smart was a single seater but customers overloaded the vehicle resulting in service problems.
Yo Speed, a bigger model could not be launched during the peak season due to late approval of the model from Automotive Research Association of India. The other problem was that there was difficulty in sourcing key components of the right quality.
Electrotherm has also developed a hybrid electric bus which is under testing with ARAI. The company launched the two wheeler electric bike in 2006.
In 2007-08, it sold a total of 16,441 bikes. The company has also plans to launch electric three wheelers. For the bus project, the company has entered into a MoU with Merkavum of Israel for the supply of technical know-how.
The company’s annual report for 2007-08 says that its Kutch expansion project at a cost of Rs.4 billion has augmented its sponge iron and pig iron capacities.
A captive power project is also being installed and will be ready for operation in June 2009. With this the company will be self-sufficient in sponge iron, pig iron and power.
To take advantage of the opportunities in emerging transmission line tower business, the company is setting up a composite unit.
The project envisages the setting up of a steel melting facility of 220,000 tonnes a year, bloom casting facilities of 210,000 tonnes a year along with structural and rolling and fabrication facilities of 200,000 tonnes and 100,000 tonnes, respectively.