The Hindu Business Line : Lucas-TVS to set up jt venture with Iranian co for starter motors

LUCAS-TVS has formed a joint venture with Feiz Ghadir Industries, Tehran, Iran, to produce starter motors for supplying to SAIPA, Iran's major car manufacturer.

While the press release on the joint venture is silent about the relative stakes of the partners, Business Line has learned that Lucas-TVS will hold a controlling stake. The tie-up envisages an initial investment of $1.5 million (Rs 7 crore), which will go up to $4 million (Rs 30.4 crore) over the next few years. The plant — to be located near Tehran — will produce 250,000 starter motors, which will increase over a period of time. The venture will start with the manufacture of starter motors for supplying to SAIPA and gradually introduce other products such as alternators, window lift motors, seat motors and wiper motors.

"This joint venture comes after a successful business relationship between Lucas-TVS and Feiz Ghadir Industries (FGI) over the last six years," said the release. FGI is part of Ahmad Rahimzadeh & Son, which has been in business for over 50 years. Started in 1994, FGI had supplied different types of ignition distributors to car manufacturers and then enhanced its product range. It is currently a leading manufacturer of fan motors and it supplies to major passenger car manufacturers in Iran. FGI's turnover has gone up from $6 million in 2004 to $14 million in 2005.

Iran produces around 750,000 cars and plans to reach the million mark soon. The two principal car manufacturers are SAIPA and Iran Khodro. The large volume car models are the Pride car from the Kia stable and Peugeots.

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