Trade and Industry Editor
SA's largest tile and sanitaryware maker, Ceramic Industries, hopes to enter the US market by investing in an Australian factory.
CE Nick Booth said at the weekend that offshore expansion was a consequence of slow local market s and the need to grow by developing new ones.
Until recently the company was considering an investment in Italy, but abandoned it in favour of the Australian venture. The R140m Australian facility 150km north of Sydney was due to be commissioned in December so the company could enter Australia's market in early January.
"This is similar to one of the production lines at our Pegasus plant in Vereeniging," said Booth.
"It will produce 9000m² of floor tiles a day, and there is space to put in a second line and double production.
"If we do expand our markets, it would be to the west coast of the US, and this could happen in the next 18 month to two years."
The Pegasus plant is supported by a R30m state strategic industrial programme incentive in the form of lower tax bills once a project is up and running.
Booth said the local market was tough at the moment with imports from China and Brazil. As a result, prices fell about 5% this year, but there were optimistic signs in building plans and prospects for greater state infrastructure spending.
The second production line at the Pegasus plant came on stream in April, doubling capacity of the plant and boosting Ceramic Industries' overall production 12%, he said.
Jun 30 2003 07:57:52:000AM John Fraser Business Day 1st Edition
Monday
30 June 2003
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