Great respect for Carlo Gavazzi Malta

Careers in the manufacturing sector are not only providing secure employment in state-of-the-art factories, but are also creating openings for research and development in Malta.

The Carlo Gavazzi Group, a Swiss company of Italian origin, first laid eyes on Malta in 1988 when it bought out the whole Electromatic Group, including its tiny plant in Malta, with the intention of setting up Carlo Gavazzi Malta.

The company, which slowly started to tick, first tried its luck at sub-assembling solid state relays (switches). This worked so well that a long-term plan to produce the product from start to finish in Malta was eventually outlined.

In 1996 the company became fully autonomous with its own Research and Development and Product Management departments.

"This was a major breakthrough. Carlo Gavazzi Malta changed from an assembly unit to a fully-fledged company. Because the product we manufacture is so important to the group, had we failed, this would have affected the whole group," Ray Attard, managing director of Carlo Gavazzi Malta, told The Sunday Times last week at the plant in Bulebel.

Mr Attard, who has been with Carlo Gavazzi Malta for the past 15 years, first occupied the position of financial controller and shortly after was promoted to financial director. He became managing director in 1996.

The Carlo Gavazzi Group is made up of 16 wholly owned sales companies, 14 of which are in Europe and two in the US and Canada. The company also operates four business units which manufacture different products but all focus on industrial automation - one in Malta, two in Italy and another in Denmark.

Carlo Gavazzi Malta exports globally through this network of sales companies. Its biggest market is Germany, followed by the US and the Far East.

"But we export everywhere, including Australia, New Zealand, South Africa, South America and Canada, and the demand for solid state relays is remarkable," Mr Attard said.

"The company's market share is 5%, which is still relatively low. However, Carlo Gavazzi Malta is a big player in Europe and has an excellent reputation for quality."

Six years ago the company had a sales turnover of about Lm2 million a year. Now it sells Lm5 million.

"The plan is to increase company revenue by another Lm2 million by next year. The situation in the market is currently lousy but we are managing to win from other competitors because of new products we launch regularly," Mr Attard said.

About Lm300,000 are currently being invested by Carlo Gavazzi Malta in four new projects, which, together with other minor products called 'specials', will be launched at the Hanover fair in April.

"These non-standard products constitute about 60% of the company's turnover," Mr Attard said. "This highlights the flexibility of our company and especially of the Maltese people.

"We manage to attract a lot of business because our competitors are not so flexible. This is why we are winning out within such a depressed scenario. Carlo Gavazzi Malta intends to increase its sales this year from Lm4.5 million to Lm5 million.

Carlo Gavazzi Malta employs a workforce of 230. About 160 are operators who perform manual work. The rest are middle and top management. Five managers work closely with Mr Attard and 16 are involved in research and development.

There are also 22 fully qualified electrical engineers. Other departments include stores, quality, sales promotion, advertising and the recently set up product sales support.

"To come up with the product, you require high technical skills. Aptitude and IQ tests are usually carried out before employing individuals, " Mr Attard said. "Working in the solid state relay business for the past 15 years and producing over a million solid state relays a year has also given us the necessary know-how."

In terms of productivity and efficiency, he said the Maltese worker compared much better than his/her counterpart overseas.

"We are 20% better off. What we perhaps lack is the level of social conscience which, on joining the EU, we might polish up on. Although there is a good amount of discipline in the company, there is always a big need for policing.

"Employees are willing to learn and co-operate but need to continue to strive to be more precise in their work. If you believe an idea is good, you must keep it at a sustainable level."

The original 1996 plan to not only produce solid state relays but to market, develop and research them, worked wonderfully. For the past three years, this has been proved to the satisfaction of the Carlo Gavazzi Group.

"Considering the limitations we have had (that in a short period of time, from an assembly plant the company became fully autonomous) the mother company is quite happy with our achievements," Mr Attard said.

Three years ago Carlo Gavazzi Malta registered a 30% growth. It is estimated that every year the company grows by 15-20%. This year, a 16% increase is envisaged.

"We have had a 25% increase in the North American market, currently a sensitive market. We have realised that with all the good products and opportunities for our customers, a 25% increase in one year is achievable.

"I also envisage an upswing in orders from Germany, our main market (we export 35% our output to Germany). This is because in Germany there are many original equipment manufacturers (OEMs) of huge machinery which make use of a lot of solid state relays," Mr Attard said.

Carlo Gavazzi Malta is and has been for the past six years the exclusive supplier of solid state relays for Arburg, a top German company which produces injection moulding machines. Carlo Gavazzi Malta is such a customer-focused company that it supplies a specific line of products for Arburg.

Carlo Gavazzi Malta also has specialised people who work solely on these products, which go to Arburg only. Out of Carlo Gavazzi Malta's Lm5 million annual sales, about Lm400,000 come from Arburg.

Prospects are very bright for the local company, especially with regard to the American market. The company's market share in the US alone stands at 3.5%.

"Apart from the 15% increase in market share in Europe, in the US we intend to treble business, i.e., we would like to reach a 10% market share. America is the most promising market after Germany for Carlo Gavazzi Malta," Mr Attard said.

Carlo Gavazzi Group is setting up its 17th sales company in Kuala Lumpur, Malaysia. The eastern part of Europe, including Russia, is another very promising market for the mother company.

Carlo Gavazzi Group is looking forward to more stability, perhaps with the EU, so it can then penetrate this market. The North African market is also quite promising.

"Although Carlo Gavazzi is not a big name in Malta, those who know about us respect us immensely. I say this with some pride," Mr Attard said.