Otis sees elevators with 6 times standard speed driving growth

Otis, which set up India’s first elevator in Raj Bhavan, Kolkata, in 1892, has come a long way, maintaining its leadership position all along. India is now the second-largest market for Otis, which has operations in 200 countries. Sebi Joseph, managing director, Otis, spoke to Beryl Menezes about the industry and the company’s plans. Excerpts:

Can you throw light on investment and expansion plans in India?
We are in the process of doubling the capacity of our manufacturing unit in Bangalore to 10,000 units and trebling our factory area to 27,000 square metres. This should be ready by the year-end and it will become the largest elevator factory in India. We are also planning to hire 50-70 employees for the factory, which will be added to the current 150, post expansion. Overall, we employ 2,500 people in India.

What is your best-selling product in India?
Our 1 metre per second (mps) elevator is still the best-selling product in the Indian market, contributing to 60% of our revenues. 1mps also makes up 40% of the overall elevator market in India.

However, our latest product is GeN2 elevator at 1 mps which is fastest selling model and is rapidly gaining traction in India.

So far we have been able to sell 2,500 units and by next year, we expect to sell 9,000. Worldwide, we have sold 250,000 such elevators.

What is Otis share in the Indian elevator market and what are your growth projections, going forward?
Otis is the largest elevator company in the world. In India, too, we dominate the market and a maintenance portfolio of 55,000 units.

With real estate prices spiralling and space dwindling, are you witnessing a drop in sales?
We believe the lull in the realty market is only temporary. About 70% of our business comes from the residential space, where we see no slowdown. According to industry estimates, there would be a 26 million housing shortage in the next two years, which will drive the elevator market. The drop in demand is only in the commercial space like malls and office buildings. The infrastructure space, which contributes 10% to our revenues, is also set to grow with the construction of metros and airports, which will compensate for the commercial downturn.

What is your strategy to grow market share?
Since 2% of the real estate elevator market today consists of high-rises, we plan to aggressively get into this space and plan to capture 50% of this market by 2013. We have expertise in this area as we have worked on major global projects like Burj Khalifa in Dubai.