Japanese automobile manufacturer Isuzu launched its new factory in Andhra Pradesh paving the way for it to carve a niche in the Indian light commercial vehicle (LCV) and utility vehicle (UV) markets.

The new production unit, which was inaugurated by Andhra Pradesh Chief Minister N Chandrababu Naidu, has come up on a 107-acre site at Sri City, a multi-product SEZ located 60 km to the north of Chennai.

The factory will generate jobs for around 2,000-3,000 people and the company has earmarked ₹3,000 crore investment over three to five year period.

The factory, which will initially have an annual capacity of 50,000 units can be scaled up to 120,000 units, will produce Isuzu’s soon-to-be-rolled out D-Max V-Cross, an Adventure Utility Vehicle, and new variants of its pick-up truck brand D-Max.

Both the vehicles will come with about 70 per cent localisation as the company roped in about 150 suppliers in a bid to be cost-competitive in the Indian market.

The D-Max V-Cross, which will be powered by 2500 cc diesel engine, seeks to create its own set of customers in the UV segment.

But, the company will be marketing the new UV at a time when higher power diesel vehicles are increasingly getting caught in pollution-related hurdles.

In the NCR, for instance, the Supreme Court has banned sale of passenger vehicles powered by diesel engines of two litres and more till April 30.Isuzu is a pioneer in diesel engines and all its vehicles are powered by diesel engines only.

Masanori Katayama, President, Isuzu Motors Ltd, pointed out that there is a wrong notion that diesel technology is bad for environment.

“The diesel technology offers 25-30 per cent better fuel efficiency than petrol,” he said.

The same point was mentioned earlier by the Ambassador of Japan to India, Kenji Hiramatsu, at the inauguration.

Isuzu is preparing to roll out D-Max V-Cross priced at about ₹15 lakh and D-Max pick up trucks, which will come in two and four-door options, over the next two quarters.

Pick ups will target niche applications in the sub-3.5 tonne of small commercial vehicle category.

Meanwhile, Isuzu will keep its contract manufacturing operations at Thiruvallur, near Chennai, going and will continue to assemble its premium SUV MU-7 there.

Naohiro Yamaguchi, President and Managing Director, Isuzu Motors India, said that the company had set up 27 dealers across the country and would ramp up further in the coming months.

Isuzu has sold about 3,000 units that include pick ups and UV over the past few years in India.

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