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M Ramesh

Chennai, Jan. 9 While French car maker, Renault, today said that it would put its investments in Tamil Nadu on the backburner till the economic situation cleared up, another European investor into the State, Daimler, has confirmed raising its investments.

The German automobile giant, Daimler, which is putting up a commercial vehicles manufacturing facility in Tamil Nadu in collaboration with the Indian Hero group, had initially pegged its proposed investments at Rs 3,000 crore. It had however said that it might increase its investments to Rs 4,000 crore.

Business Line learns that about a week ago, Daimler confirmed to the state government that it would invest Rs 4,300 crore in Tamil Nadu. This would enable the joint venture company, Daimler Hero Commercial Vehicles Company, to avail itself of the package of fiscal benefits given by the state to projects with investments of at least Rs 4,000 crore.

It is however not clear if the additional investments would lead to an increase in plant capacity. When Daimler signed a MoU with the State Government in July, it had said that the capacity of the upcoming plant would be 70,000 vehicles a year. The plant is expected to by production-ready by 2010.

More Stories on : New Projects | Cars

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