A long-established New Zealand firm is making life harder for Fisher & Paykel Appliances by supplying a Chinese competitor.
Scott Technology is two months into a $4 million contract supplying Haier with automated production lines for manufacturing its low-price home appliances.
Rubbing salt into the wound, Dunedin-based Scott also supplies its appliance production lines to several other F&P competitors, including Whirlpool, Electrolux, General Electric and Maytag.
Last week, Auckland-based F&P, which also has a big plant near Mosgiel, blamed fierce competition from Asian home appliance manufacturers, along with high steel prices and the strong Kiwi dollar, for its third profit downgrade in six months.
Shares in the whiteware company fell by more than 12 per cent on the day it said it now expected an after-tax profit of between $63 million and $68 million for the March year ““ well down on its original projections of about $85 million.
Scott’s chief executive, Kevin Kilpatrick, said its deal with Haier was a strategic move to gain a foothold in China and secure work with a company that was on track to become the world’s biggest appliance manufacturer.
“Fisher & Paykel is a great company, a great example of an innovative New Zealand company. But they need to focus on innovative machine technology products ““ there’s no way that anybody can compete with something from Haier,” he said
F&P Appliances spokesman Brian Nowell said there were no plans for his company and Scott to work together. It was not concerned about Scott’s contracts to supply production lines to its competitors overseas.
From Stuff.co.nz