Friday, 14 October 2011

Volvo to Invest Rs 400 Crores in Indian operations



Swedish transport major Volvo will invest Rs400 crore over the next five years to expand its bus manufacturing unit in India, chief executive Hakan Karlsson, said in Bangalore on Thursday.''

We will invest Rs.400 crore during the next five years to expand our installed production capacity to 5,000 units per annum in two phases, from 1,000 units currently and introduce a range of new products, including hybrid version,'' said Karlsson.

Currently, its manufacturing plant in Hosakute, Karnataka, has a capacity of 1,000 units which will be ramped up to 1,200 units in the next couple of months. The company also plans to adopt a higher level of localisation. “As of now there is only 35-40% localisation, which will be increased to 80% by 2015,” said Akash Passey, managing director & CEO, Volvo Buses, India, adding that it wants to be a billion-dollar company in India in the next five years.

Volvo to invest Rs400 crore, raise capacity 5-foldPublished: Friday, Oct 14, 2011, 9:30 ISTBy Suparna Goswami Bhattacharya | Place: Bangalore | Agency: DNAVolvo Bus Corporation plans to invest Rs400 crore in India in the next five years as it sees the country, along with China, as a key market for offsetting sluggish sales in North America and Europe.Marking the Swedish group’s 10th anniversary in India, Hakan Karlsson, president and CEO, Volvo Bus Corp, said, “We have an expansion plan for Asia where India and China will be the key drivers of growth. We want India to be a global hub to deliver our global selective model.” He said about 15-20% of the projected sales in India will be exports.

The company currently exports to Africa, the Middle East and South Africa.In India, the company wants to diversify into the mid-segment and increase manufacturing capacity fivefold to 5,000 units by 2015 by setting up a new plant.Currently, its manufacturing plant in Hosakute, Karnataka, has a capacity of 1,000 units which will be ramped up to 1,200 units in the next couple of months.

The company also plans to adopt a higher level of localisation. “As of now there is only 35-40% localisation, which will be increased to 80% by 2015,” said Akash Passey, managing director & CEO, Volvo Buses, India, adding that it wants to be a billion-dollar company in India in the next five years.He said 10 years back when Volvo entered India, there was no premium segment for buses and the journey had not been too rough for the company.“

Thankfully, we had a wide range of products to choose from, so did not have to design anything special for India. For instance, even today there are countries where there are no tar roads. India that way was a lot easier for us,” he said.

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