Hitachi Construction Machinery, Japan’s leading excavator manufacturer, will expand its output capacity in Indonesia to meet increasing demand for construction, mining and forestry equipment in Southeast Asia.

The annual capacity of the Indonesian plant will rise 67 percent to 5,500 units by March 2014, from 3,300 currently, CEO Michijiro Kikawa said.

Indonesia’s central bank forecasts economic growth to accelerate to as much as 6.7 percent this year as the government boosts spending on railways, airports and roads. Across the industry, excavator sales in the Southeast Asian country will rise 40 percent in the year ending March, faster than an estimated 15 percent increase in India, Kikawa said.

“Demand in Indonesia will grow at a faster pace than we had thought,” Kikawa said March 21 at the company’s headquarters in Tokyo. “We’re accelerating expansion to catch up with demand.”

Hitachi Construction Machinery, also the world’s largest maker of giant excavators, said this month it will also build a second Indonesian plant in Cibitung to make underground carriages as part of a $570 million plan to expand its ability to produce large mining equipment.

The shares fell 1.7 percent to 1,823 yen in Tokyo yesterday. Hitachi Construction Machinery has risen 41 percent this year, outpacing the 20 percent gain in the Nikkei 225 index.

Source:cmbol.com