German Furniture Giant Hettich Group Invests ₹700 Crore in Manufacturing Growth
The Hettich Group, a leading German furniture and hardware brand, has announced plans to create 1,000 new jobs in India as part of its ₹700 crore investment to expand its manufacturing footprint in the country. The company, which recently opened a new plant in Vadodara and broke ground on another facility in Indore, aims to solidify India as a key hub for its global operations.
The new Indore plant is expected to commence commercial production by the final quarter of 2025, bringing the company’s total manufacturing facilities in India to five.
India: A Key Market for Hettich Group.
India is the Hettich Group’s second-largest market globally in terms of turnover, following Germany. The nation’s burgeoning middle class is a significant driver of this growth. Andreas Hettich, Chairman of the Hettich Group Advisory Board, emphasized the importance of catering to domestic demand:
“More and more consumers in India are now able to afford furniture and kitchens with our hardware for a better lifestyle. By producing locally, we can better serve domestic demand and ensure faster delivery.”
Currently, the majority of products manufactured in India are sold within the country, highlighting the strength of the local market.
Aligned with the ‘Make in India’ Initiative
The Hettich Group credits the Indian government’s Make in India initiative for its success in the region. The policy, combined with India’s lower labor costs compared to markets like China, has made local production a viable and profitable strategy.
“As part of our global strategy, India is poised to become our next big manufacturing hub after Germany,” said Andreas Hettich.
However, the company acknowledges the challenges of operating in India, citing issues such as infrastructure, logistics, and regulatory complexities as areas needing improvement to attract more foreign investment.
Focus on Self-Sufficiency Over Partnerships
While many global firms enter India through collaborations with local companies, the Hettich Group has chosen a different path. Andreas Hettich stated:
“Our primary focus is on building our own footprint and investing in our production facilities rather than pursuing partnerships or collaborations with Indian firms.”
This strategy reflects the company’s long-term commitment to establishing a robust, independent presence in India.
Global Ambitions: Acquisition of FGV Group
In a separate but related development, the Hettich Group recently announced its intention to acquire Italian hardware manufacturer FGV Group, pending antitrust approval. Andreas Hettich described this acquisition as a strategic move to expand the company’s product portfolio.
“Hettich is known for its aspirational, premium luxury products, while FGV offers value-for-money solutions with an Italian touch. This acquisition will help us reach a broader range of consumers and strengthen our global market position.”
Addressing Challenges in India’s Manufacturing Landscape
Despite its success, Hettich acknowledges challenges in India’s business environment. The company has pointed out key issues such as:
- Infrastructure limitations: Transport, logistics, and energy supply are areas of concern.
- Regulatory complexity: Administrative hurdles and slow approval processes can impact business operations.
Andreas Hettich noted, “While India offers immense potential, addressing these challenges is crucial to make investing and operating here more efficient.”
Driving Innovation and Employment
The planned expansion underscores the Hettich Group’s confidence in India’s growth story and its potential to serve as a global manufacturing hub. By 2025, the company’s investments are expected to create 1,000 new jobs, providing opportunities for local talent while advancing the Indian manufacturing sector.
With its strategic investments, focus on innovation, and alignment with government initiatives, the Hettich Group is poised to play a pivotal role in shaping India’s industrial landscape.
Conclusion
The Hettich Group’s ₹700 crore investment in India reflects its commitment to the region’s growth potential. As it addresses infrastructure and regulatory challenges, the company is set to contribute significantly to India’s economic development while strengthening its position as a leader in the global furniture and hardware industry.
