Mumbai: The joint venture of India’s Ashok Leyland Ltd and Japan’s Nissan Motor Co. is on track to start production of light trucks in 2010-11 with exports making up a fifth of the total output, the duo said on Monday.
The venture for light trucks signed in May this year, along with those for power train manufacture and technology, will set up a plant in Pillaipakkam near Chennai with an initial capacity of 100,000 units, they said.
“The joint venture with Nissan is a major step in our plans to be a full-range player and we are confident that we can meet our production targets,” R. Seshasayee, managing director of Ashok Leyland, said in a statement.
Stepping up: Ashok Leyland and Nissan Motors officials exchange documents with Tamil Nadu industries secretary M.S. Farooqui in Chennai on Monday as chief minister M. Karunanidhi looks on. PTI
The Leyland-Nissan ventures had committed to investments of about Rs24 billion with plans to build a new range of trucks for the local and overseas markets.
Leyland, the country’s second biggest bus and truck maker, will also invest in expanding capacity for medium and heavy trucks, as it seeks to more than double its capacity. Combined investments will exceed Rs40 billion, the statement said.
Leyland, which trails leader Tata Motors Ltd, will step up capacity at its facilities in Ennore and Hosur in southern India as well as at a greenfield site near Chennai for engines, gear boxes, chassis and parts. The new facilities will create more than 4,000 jobs and get tax concessions for 21 years, it said.
Demand in India, the world’s fourth largest market for commercial vehicles, is expected to grow on improving roads and a focus on infrastructure.
Volvo is investing $350 million (about Rs1,550 crore) in its venture with Eicher Motors Ltd, while Daimler AG is investing more than $1 billion in its tie-up with the Hero Group which will also locate its facilities in Chennai.