October 3 - ABB’s new high-tech manufacturing line in Finland produces variable speed drives – which are used to regulate the speed of everything from ski lifts to pulp and paper production.
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“The strength of our core businesses rests on operations like this, which are steeped in technology leadership and a 100-year history of innovation,” said Dinesh Paliwal, head of ABB Automation Technologies. “Stroemberg Company, the foundation of our drives business, started here in Finland in 1889.”
The new production line is nicknamed “Galactica” for its futuristic manufacturing techniques. It currently produces 100 drives a day in the power range 50 kVA to 610 kVA. Variable speed drives are used in almost all industries to control the speed of motors. By adjusting motor speed based on demand, significant amounts of energy can be saved. ABB estimates the global market for drives to be around US$ 5 billion.
Pekka Tiitinen, head of low-voltage drives for ABB in Finland, says the line is easily adjusted to customer requirements. Big Finnish customers like Stora Enso (forest products), Outokumpu (metals) and UPM-Kymmene (forest products), and M-Real (paper and paperboard) count on ABB drives to be fast and flexible. They also help them reduce the impact of carbon dioxide emissions on the environment.
“This new production facility strengthens our market position, which is driven by strong product development,” said Tiitinen. “We needed to expand our operations to meet growing demand for our products.”
Helps market share
According to ARC Advisory Group, ABB has a 15 percent share in the AC drives market. The company's nearest competitors are Siemens, Mitsubishi, GE Fuji (a joint venture) and Rockwell Automation, which all hold about eight percent of the market.
Smaller competitors include Schneider Electric, ALSTOM, Asi Robicon, Hitachi Danfoss and Vacon.
ABB’s Drives and Motors business area currently makes up around 16 percent of ABB’s Automation Technologies’ US$ 8.5 billion in revenues. It is a high-tech market leader with strong positions in North America, Europe and Asia. It is also poised for growth in India and China, two of ABB’s key markets going forward. “The market is very fragmented and there is good potential for taking market share,” said Tiitinen.
ABB’s drives strategy hangs on constant investment. The company has strong drives teams working in Helsinki, Finland, New Berlin, U.S. and Beijing, China. As a result, the company’s direct torque technology and compact design are the industry standard. “Since the 1980’s the size of drives, measured in volume, has decreased by some 70-80 percent,” adds Tiitinen. “While the number of components has come down by some 60-70 percent.”