Movers & Makers | Pekka Vauramo, President & CEO, Metso | mojo4industry
India’s burgeoning infrastructure sector presents numerous opportunities for both domestic and international companies. They have been actively participating in India’s infrastructure growth story and Metso, the Finland-based frontrunner in sustainable technologies, end-to-end solutions, and services for aggregates, mining, metals refining, and recycling industries, is one of them.
WATCH this exclusive episode of mojo4industry “MOVERS & MAKERS” where Pekka Vauramo, President & CEO of METSO speaks to Subhajit Roy and outlines the company’s growth plan. He considers India as a bright spot for growth amid global uncertainties.
Metso has invested more than Rs 1,350 crore in the Indian market, currently generating annual sales almost equal to this amount. How do these figures impact your group’s balance sheet?
India is one of our eight global market areas, currently experiencing rapid growth. We maintain a strong focus on India, with our largest factory located in Alwar, Rajasthan. This factory is the largest among our 40 global facilities, making India a significant market and a source of materials and goods for exports. Approximately 50% of our India-produced goods are exported.
It has been more than three years since the merger of Metso and Outotec. How has this merger impacted your global business?
We are now a complete supplier of mineral processing equipment, covering the entire range of the process and its variations. This positions us well to compete for opportunities and provides a comprehensive view of the entire process. This, in turn, aids our R&D efforts to create more sustainable and efficient processes for our customers.
For every company, people are of utmost importance. Are you content with the resources you receive in India?
India is one of the countries where a significant number of mechanical and electrical engineers graduate each year. We run specific graduate programs to ensure effective onboarding into our company.
In the context of energy transitions, how do you anticipate the evolution of the mining and mineral processing industry over time?
This transition necessitates metals. It’s not just about wind, solar, or nuclear energy; the generated electricity needs to be transmitted to consumption points or for storage. Copper and aluminum are essential for building the grid, with copper being particularly vital in electrical devices, electric motors, substations, transformers, and various equipment.
The focus is currently on electric vehicles (EVs), and major car manufacturers are introducing the first generation of EVs. However, this represents just the initial wave of EVs, which is driving demand for battery metals like lithium, nickel, cobalt, and others. We anticipate substantial growth in lithium production during this decade. By 2040 or 2050, we expect copper production to double, and we foresee strong and sustained demand for these metals in the context of electrification.
EVs have emerged as a prominent sector and are widely discussed globally. India has identified some lithium resources. How do you foresee the impact of this evolving factor on your business in the coming years?
India is one of the largest consumer markets and a manufacturing hub for vehicles, including cars. I anticipate continued growth in vehicle manufacturing in India, leading to the establishment of domestic battery factories and lithium production. We are well-positioned in India to assist our customers in venturing into new areas, such as lithium mining, which is a novel endeavor in the country, and support them in commencing mining operations and production.
Do you believe that lithium production will be a significant driver of Metso’s growth in India in the upcoming years?
Lithium production will drive Metso’s global growth. Presently, lithium mines account for only about 5% of our sales, but with a tenfold growth expected in this decade, it will play a much more significant role toward the end of the decade, including in India.
Are there any upcoming products in the pipeline designed with the abundant reserves of lithium in India in consideration?
Yes, we have recently introduced a process for lithium hydroxide production. This process eliminates harmful tailings and completely avoids the use of sulfuric acid. It is an environmentally friendly and cost-efficient method, with operating costs approximately 30% lower than traditional methods.
As it indicates your readiness to be part of India’s EV growth, particularly in terms of lithium production.
Yes, we are closely involved in this area. There is a lot of excitement, and we conduct extensive research on lithium production and process development.
What are your long-term, mid-term, and short-term objectives in the Indian market? You’ve made the desired investments and established a new facility; what are your next steps?
Our goal is to expand in line with the market. The global market is evolving, and we must adapt to a more localized world compared to what we envisioned a decade or two ago. This implies that regions will play a more independent role, and we aim to provide more comprehensive deliveries from each of our factories to their respective regions. This approach not only reduces logistics costs but also contributes to lower emissions associated with logistics.
Considering the anticipated growth in India’s infrastructure development and the global rise of EVs, are there plans to make capital expenditure commitments for your Indian business?
Our growth in India will align with market expansion, including exports. In Alwar, our investments will primarily focus on maintenance, replacing older factory components, and necessary plant modifications. In Ahmedabad and Vadodara, our foundries offer room for expansion. Our engineering hubs will also grow and necessitate investments, particularly in human resources.
Where do you envision Metso in India five years from now?
We will sustain our growth in India. Metso is widely recognized in the mining and metals industry, and our capabilities are well-known. We have received a positive reception in the country. There is no doubt that we will continue to expand in tandem with the market, as we are committed to staying here. It’s worth noting that India is currently our largest country in terms of employment, with over 3,000 people working for Metso.
