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India

Serious entry into Spanish market

Five months after opening its commercial branch in Madrid, Indian wind turbine supplier Suzlon has landed its first deal in Spain. The 84 MW turnkey contract is with developer Iniciativa Energética for projects in Castile and León region. "This is just the start," says Felipe Garcia Mina, Suzlon's local boss. "We've received preliminary commitments for much more."

Just how much more he declines to say, but Suzlon expects to become Spain's third biggest supplier within three years, Mina says. By 2020 at the latest, it should be in the running for top position in Spain, he adds. "Our more immediate plans require a local industrial base." A decision on exactly where and what manufacturing facilities to build is expected in the next few months as part of Suzlon's expansion plan for southern Europe, just one element of the its global growth strategy.

While Suzlon maintains a 50% share of its home market in India, the world's fourth largest for wind turbines, domestic sales account for just 20% of global revenues, compared to 80% in 2005. Suzlon makes turbines, blades and towers in China and the US as well as in India, owns major wind turbine gearbox supplier Hansen, and last year added a controlling interest in German turbine manufacturer Repower to its holdings. In the past six months its turbine manufacturing capacity has increased from 2700 MW to around 4000 MW, without the around 1000 MW from Repower. The aim is for a combined annual output capacity of 12-13 GW by 2014.

The most successful turbine companies will integrate component manufacturing, says Mina. "We're a strong competitor in Spain or any other market," he adds, suggesting Suzlon is more vertically integrated than even local rival Gamesa, which has sat on 55-60% of the Spanish market for over half a decade.

"Suzlon will really start slotting in as of 2010, as existing framework contracts with other manufacturers reach their end," Mina says. "After that, the repowering market will start getting a hold, with huge and continuous potential. We'll be there with a strong supply chain."

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