September 08, 2008

BHEL to counter China in power production

BS quoted Mr RN Mishra executive director of BHEL as saying that Bharat Heavy Electricals Limited is facing the Chinese heat as it lost a couple of orders recently as China outbids it by quoting prices lower by 20% to 30%.

Mr Mishra said that “While in India we are contemplating additional capacity for power plant equipment in the range of a few thousand MW, the Chinese already have an installed capacity of over 100,000 MW. We are confident of bagging at least 17,000 Mw more in the thermal segment.”

Though BHEL is in a comfortable position with orders worth 35,000 MW just 6 months into the 11th plan, it has devised strategies to counter the increasing competition. In the on going 5 year period, it is set to execute orders worth 42,000 MW at the rate of 8,000 MW per annum. For this, BHEL is already in the process of expanding its manufacturing capacity by spending INR 1,000 crore and has asked its sub contractors too to go for capacity addition to match its capability.

Mr Mishra, while addressing the ‘Sub Contractor’s Meet 2007’, has also asked the 300 odd sub contractors to consider ways of cycle time reduction and cost control measures. BHEL would also introduce a system which will help sub-contractors procure the requisite raw materials themselves than getting them from BHEL. This would contain the cost of production and enhance the delivery schedule. He also called for frequent interactive sessions between the contractors and vendors.