Rockwell Automation Inc. hopes to grow at an annual rate of 25 percent to 30 percent in the next couple of years. Keith Nosbusch, president and chief executive officer at the $5 billion Milwaukee-based automation and controls company, has recently visited India, and appears to be betting big on the country to meet the growth figures. India is Rockwell's fastest growing center in the Asia-Pacific region, and Nosbusch says that India is very important to its business strategy.
"Indian manufacturing is looking up. The current Indian market potential for our business is around $114 million. We have around 30 percent market share in programmable logic controllers (PLCs),” he stated. Rockwell has specific offerings for various sectors including automotive that are doing well in India, Nosbusch added.
"Indian manufacturers, who serve global markets, are always in need of high-level automation to manufacture goods with precision, greater machine speeds and less time-to-market. Since we are in the business of industrial automation, we sense a great opportunity here," Nosbusch added.
No choice?
However, some industry observers believe that, with Siemens and Schneider Electric competition knocking at the door in North America, Rockwell has no choice other than to expand overseas. All of the larger global players have already done that.
Rockwell is already in the process of establishing an Asia-Pacific business center in Singapore. The center, which is expected to be fully operational by 2008, will consist of select business management, engineering, and manufacturing operations, the company said in a press release.
The center will initially house several business segments that are in demand in Asia, and highly strategic to the company's global growth. These include small PLC platforms, distributed input/output, component operator displays and component drives. In addition, a product development center will be established there with the coordination of associated design and manufacturing partners. "This move reflects the next logical step in Rockwell Automation's growth strategy to invest in serving customers worldwide," said Nosbusch.
Meanwhile, as a way to help control burgeoning costs, Rockwell will move high-end integration work to the Bangalore application development center. "The center will move toward taking jobs in integrated architecture and communications in the space of application development, where it will be involved in developing solutions that would integrate different products and software," Rockwell Automation President (Asia-Pacific) Scott Summerville stated.
The center is currently involved in improvement of product configuration and applications for global customers of Rockwell. It is of tremendous commercial value, he said.
OEM strategy
"Rockwell's India strategy has been to work closely with OEMs (original equipment manufacturers) of large manufacturers," Summerville added, claiming 24 percent market share in India.
India currently provides 10 percent of Rockwell’s Asia Pacific revenue, placing it in fifth position in terms of revenue contribution after China, Korea, Australia and Japan, Summerville noted.
Rockwell recently acquired Datasweep, which has expertise in plant-wide information systems. "We will continue to evaluate the scene and there are bound to be more acquisitions in the future," he said.
According to market pundits, Rockwell is looking at the possibility of acquiring another automation- or information technology-based company engaged in the same line of activities in India. The prime consideration for the acquisition would be value generation for Rockwell and the company it acquires. Other acquisition possibilities, according to industry watchers, include companies that are niche players in certain domains that are related to Indian manufacturing automation processes.
Rockwell Automation India, which employs around 180 employees, has a turnover of around $70 million. It is now entering the domain of process industries—broadly involving a chemical process rather than engineering or fabrication—that is dominated by the likes of Siemens and Emerson Process.
About the Author
Uday Lal Pai, [email protected], is a freelance writer and editorial consultant based in India.
