(Yicai Global) Oct. 14 -- Chinese appliance giant Midea Group started construction at its first overseas heat pump plant in Italy, which is likely to cut the delivery time to one month from five months.

The first phase of the plant, which is expected to have an investment of EUR60 million (USD58.7 million), will focus on the research and development and production of heat pumps, Yicai Global learned from the Guangdong-based company. To be completed by the second quarter of 2024, it will be located at Midea’s unit Clivet’s site in Feltre, Belluno province.

Heat pumps are energy-saving devices that warm by absorbing heat from the air. Their carbon emissions can be 60 percent to 80 percent lower than coal-powered boilers.

With the ongoing energy transition, the European heat pump market is expected to maintain an average annual growth of 10 percent in the next five years, with market demand of about 40 million units, Midea said.

Midea has two heat pump plants in Foshan, Guangdong province, and Hefei, Anhui province. With the Italian one, the firm’s total annual capacity of heat pumps will reach 1 million units to meet the growing market demand, said Liu Ligang, deputy general manager at Clivet.

The heat pump market has been further accelerated by the energy crisis caused by the Russia-Ukraine conflict this year, which led the European Union to promote its carbon neutrality targets. Countries including France and Italy also introduced subsidies for consumers to install heat pumps, Liu pointed out.

To develop overseas, Midea acquired an 80 percent stake in central air conditioning manufacturer Clivet in 2016. The firm has 35 sales offices, 260 retailer channels, and 160 service sites in Italy, as well as branches in the UK, Germany, the United Arab Emirates, and India, according to information disclosed by the parent company.

Midea has 18 production bases in nine overseas countries, including Italy, Japan, and India. Last year, its overseas revenue reached CNY13.8 billion (USD19.2 billion), accounting for 40 percent of its total revenue, according to its latest annual report.

Editor: Futura Costaglione