McWane has completed the first phase of its GCC production strategy, and has revealed preliminary details of Phase 2.
The US-headquartered firm, which offers a range of ductile iron products, told Construction Week that its Abu Dhabi manufacturing plant is now online, and that production is increasing.
The facility – which at present is being used primarily to manufacture valves – has been established in a bid to cut lead times for Middle East and North Africa (MENA) customers, and to improve the company’s ability to manufacture region-specific products.
Gopi Ramanathan, senior vice president at McWane, said that Phase 2 of the firm’s GCC production strategy will be implemented in line with market developments, and will see additional products being added to the Abu Dhabi production line.
“There are two phases for this project,” he explained. “We have just implemented and installed Phase 1, with an investment of around $28m (AED103m). This phase includes the production of valves and other plumbing and fitting products for the water industry.
“During Phase 2, we are going to have backwards integration. For example, we will introduce a mixing plant for our fire extinguisher business. We think we can offer a lot of value to our customers by providing them with those products and services locally, and by mixing and packaging them here in the UAE,” Ramanathan added.
The Abu Dhabi factory, which occupies more than 10ha of land in Mussafah industrial area, comprises a machine shop, a fusion bond epoxy (FBE) coating facility, grinding, shot blast, cement lining, welding, and painting facilities. Unlike its US factories, McWane’s GCC plant will produce water, plumbing, and sewerage products to both American Water Works Association (AWWA) and International Organization for Standardization (ISO) standards, in a bid to cover the full spectrum of demand in the MENA region.
With regards Phase 2, Ramanathan emphasised that the implementation timeframe will depend on the market. Nevertheless, he said that a decision is likely to be taken within the next two years.
“Oil prices are down, but that will not affect our water business. People need water to drink all the time, and it needs to be transported,” he continued, adding that governments have no choice but to invest in water infrastructure. “So far as the decision about our next investment [Phase 2], we would like to go step by step. And that’s what we’re doing all over the world. McWane is always responsible with its investments, and it is committed to the GCC market. I think that in the next couple of years, we should be taking a decision on that as well.”
In the meantime, McWane’s senior vice president is confident that the Abu Dhabi production facility will serve not only to cut lead times, but to grow the firm’s customer base in the MENA region. Commenting on the recent opening, he said: “Our existing customers are very happy. Those were the customers who were standing on the sidelines waiting for us to put up this plant. They are very glad. As a matter of fact, during the [Abu Dhabi plant’s] inauguration, we had close to 250 visitors, including a lot of our customers and distributors.
“We have made substantial investments, and we are very glad that we can now deliver locally-produced products to our MENA customers, rather than shipping them from the United States,” Ramanathan concluded.