Mumbai: TVS Motor Co Ltd, India’s third largest two-wheeler maker, has trimmed investment plans due to slowing demand and tighter retail financing, its top official said on Thursday.
TVS, which was earlier planning to invest more than Rs1 billion annually on expansion, will now invest about Rs750 million per year for the next two years, Chairman and Managing Director Venu Srinivasan told Reuters.
“We have seen low growth and will only invest for new models and R&D projects now,” Srinivasan said.
The Chennai-based firm has plans to launch three variants of existing models and two brand new models in the next one year, he said.
“There is no significant investment in capacity, given the turbuluent conditions, we would trim our investments,” he added.
TVS Motor had recorded a 19% rise in total two-wheeler sales in September, but Srinivasan said he was expecting growth in two-wheeler industry to slow down to single digits in view of difficult financing conditions.
“We don’t expect improvements till the end of 2009, as the global economy is slowing down. The crisis in the west is affecting us here, nobody is really willing to lend,” he said.
Shares of TVS Motor were down 3.12% at Rs32.60 in the Mumbai market.