Doosan Infracore is expanding its domestic output capacity as part of a global business strategy. Company officials recently concluded an investment agreement with Gunsan City, North Jeolla Province in South Korea for building a new construction and forklift plant at the National Industrial Complex at Gunsan. The signing ceremony was attended by President Choe Sung-chul, CSO Kim Yong-sung, Jeolla Governor Kim Wan-ju and Gunsan Mayor Moon Dong-shin.
According to the agreement, Doosan Infracore will start investing W300 billion next year to build the new facility on a 1.12 million m2 site. Start up is scheduled for 2009. The municipal and provincial governments will expedite the legal red tape and will subsidize the project.
Doosan Infracore has decided to build another plant in Korea to expand output and boost productivity. These steps are seen as essential for the comapny to meet its W10 trillion sales target in 2010. The corporate goal is to be ranked among the world's top five players in the infrastructure support business by 2015.
Achieving the mid-/long-term vision will require the companywide capability to produce 31,000 excavators and 55,000 forklift trucks a year. However, the Incheon plant can only produce 9,700 excavators and 35,000 forklifts annually.
Meanwhile, Doosan Infracore has already acquired the site for the new plant, so no additional funds need to be spent to buy land. The New Gunsan Port and West Coast Expressway are right beside the industrial complex, which lowers shipping and other logistics costs.
Additional benefits are expected from the new plant as well. Supplier companies will be located in a complex nearby to ensure close cooperation and expedite parts delivery. The Incheon plant will also be able to free up some space, which will raise productivity there.
Once the new Gunsan plant is complete, Doosan Infracore will have construction equipment production facilities in three global locations. The China operation has already been expanded and output at the European plant will be increased dramatically. Total output for construction equipment (excavators and wheel loaders) will be around 50,000 units a year, about the same as that for the company's main overseas rivals.
At the signing ceremony, President Choe said, "we will develop the Gunsan plant into one of Korea's most important production facilities and continue to grow as a company that contributes to the development of local economies.' The Gunsan mayor and North Jeolla governor promised their full support to ensure the project proceeds on schedule.
