Suzlon to save 200m euro by sourcing more from India: Tanti

With its German subsidiary REpower coming fully under its control, world's fifth largest wind turbine maker Suzlon expects to shave off 200 million euros from its overall cost-structure next fiscal, which primarily involves sourcing more components from India and China.

"Nearly 65% of our spends are on components, most of which, come from Europe. But, given the current scenario, we plan to concentrate on the domestic market, as well as China, for components. This will help in reducing our material cost by nearly 100 million euros in FY13 and another similar amount from other heads," Suzlon Energy chairman and Managing Director Tulsi R Tanti told PTI.

The cost-saving will be on the back of acquisition of the German wind turbine company REpower, which it recently completed. "With the successful acquisition of the complete stake in REpower, we see ourselves well-placed in the market. We will be focusing on market positioning, joint procurement and joint technology development for all our current and future projects.

REpower, which was otherwise buying components from the European market, will now import it mostly from India," Tanti said. Suzlon expects its total expenditure, which includes debt-servicing, fixed costs and material costs to come down by 200 million euros by the next fiscal, Tanti said.

Currently, Europe is the single largest component market for the Pune-based alternative energy major, as it sources 30 per cent of its entire components from that region. A tad over 20 per cent is managed from India, while under 10 per cent come from China, he said.

"We want to bring down the spends from European market and encourage exports from the domestic market, as it will get us better margins on the one hand from overseas operations and more volume in the domestic market (which, again will help us go bargain hunting)," he said. (More)