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Nidec to invest $70m in Embraco business

JAPAN: Nidec Global Appliance is to invest $70m to increase output in its Embraco refrigeration compressor and condensing unit factories in in Austria, China, Brazil and Mexico. 

New production lines will increase the current capacity of 45 million compressors and condensing units to over 55 million per year. 

“This investment is motivated by a composition of factors, being one of them a consequence of the Covid-19 pandemic: as people all around the world are spending more time at home, it has become increasingly important to re-evaluate the level of quality and energy efficiency of residential appliances,” explained Nidec Global Appliance’s CEO, Valter Taranzano. “In parallel, more people at home means more consumption of fresh food, increasing the demand for refrigeration in the food retail sector, such as supermarkets and convenience stores.” 

Nidec also recognises cooling as a key factor in the health and scientific industries, two sectors that had a demand increase for refrigeration due to Covid-19.

With three business units – commercial refrigeration equipment, compressors and motors for residential appliances, and components for HVAC systems – Nidec says it plans to continue expanding its portfolio as well as operations, which currently involves 15,000 employees in 16 manufacturing plants.

Energy efficiency, in particular the use of inverter technology in variable speed compressors, is a target, with Nidec increasing the production of this technology in its manufacturing sites around the world

An investment of $5m in its Fürstenfeld factory in Austria, is enabling it to start the production of two variable speed models, FMX and VES, for the European market.

Similarly, in China, Nidec Global Appliance’s manufacturing site in Beijing is receiving an investment of $3m, to increase the annual production capacity of VES, VEM and FMX for the Asian market (mainly China and Japan), Europe and the United States.

The three compressors families mentioned – VES, VEM and FMX – are technologies used by OEMs worldwide, says Nidec, but especially in those countries that have stricter energy consumption regulations for appliances, and those where technology is a key buying criteria. 

Valter Taranzano: “putting us ahead of the game”

Investments in Americas are focused on cooling systems and traditional compressors. In Brazil, the manufacturing plant located in Joinville will receive $21m to add a third production line of EM compressors to boost production by an additional 2.5 million units per year. This is on top of a $4m investment already on going to increase productivity.

The new production line will produce its EM2 and EM3 residential and light commercial compressors mainly to satisfy high demand in Brazil and Latin America.

In Mexico, the production site in the city of Apodaca is receiving investments of $35m to build a new production line of ES compressors, increasing the site’s production capacity by 60%. It will be focused on responding to the North American market demand, supporting the transition to natural refrigerants in this region, with the addition of an increased cooling capacity in comparison with previous families. In total, Nidec Global Appliance is investing about $70m in its plants in Mexico.

Nice is also seeking to increase condensing units production and will invest around $2m in its Itaiópolis’ factory in Brazil. The investment will increase production capacity by 25%, serving mainly the Brazilian, Latin American and North American markets, with a smaller portion destined to Europe and Asia. 

The plant in Itaiópolis produces condensing units of all sizes, from the ones used in water purifiers to the ones with 6hp of capacity, used in cold rooms.

“In addition to responding to our customers’ demand, this investment package also puts us ahead of the game to support the transition to natural refrigerants and to variable speed, more energy efficient compressors, which are two movements that are ongoing in different stages in many parts of the world. And, of course, we need to have the production capacity required to support our future growth plans,” added Taranzano.

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