The Hindu Business Line : MAN-Force Motors venture to begin production from next year

MAN AG, Europe's third-largest truckmaker, which has a joint venture with the Pune-based Force Motors Ltd, formerly Bajaj Tempo, is all set out to roll production from the Pithampur facility of Force Motors.

Mr Abhay Firodia, Chairman and Managing Director, Force Motors, told Business Line that the Pithampur facility has added on a new facility exclusively for the joint venture.

The investment into the facility is to the tune of Rs 500 crore, which would spread over the next three years.

The new facility would commence its production from the first quarter of 2006.

He said it would produce engines, cabs and vehicle assemblies and has a production capacity of 24,000 units per annum across all the products.

Mr Firodia said the company has earmarked an investment of Rs 700 crore for expansion purposes.

Asked about the equity stake in the joint venture, he said Force Motors would be having a 70 per cent stake.

MAN will take a 30 per cent stake in the 150 million-euro ($180 million) venture with Force Motors Ltd to produce vehicles in India beginning in the fourth quarter of 2006, Mr Anton Weinmann, the truck division head, has stated at MAN's Munich headquarters.

MAN plans to sell 24,000 Indian-produced vehicles annually by 2008, which will sell for about 35,000 euros, roughly half the price of a similar truck in Europe, Mr Weinmann said.

Commenting on the MAN joint venture, Mr Firodia said it would be "coming into the market with a full platter of vehicles, which would range from 16 to 50 tonner vehicles''.

By the first year, the entire range would be covered which would have about 20 vehicles and could also have specialised vehicles on its range. These specialised vehicles could be tippers, cement mixers, fire fighting vehicles etc.

He said that it would also be manufacturing auto components for MAN AG.

Asked why there has been a delay in the project, Mr Firodia said the physical part of the project, which included development of components, putting together the equipment and tools was well on schedule. The second aspect "is that it has shifted from being a technical collaboration to a joint venture and this needs to be structured,'' he pointed out.