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The Chinese Government-owned automotive company Beiqi Foton Motor Company Ltd will set up a commercial vehicle manufacturing facility in Khed district near Pune at an investment of about Rs 1,676 crore spread over five years.
Headquartered in Beijing, the company makes light, medium and heavy duty trucks and commercial passenger vehicles. It has 16 automobile and component divisions across eight facilities in China. The Pune unit would be its first manufacturing facility outside China.
In the first phase of production, which is likely to start by early 2013, light, medium and heavy commercial tucks would be manufactured. In the second phase, which is still on the drawing board, other commercial vehicles would be manufactured.
After the Shanghai Automotive Industry Corporation Group (SAIC), Beiqui Foton is the second Chinese automotive company to set up office here. SAIC in partnership with General Motors would be soon offering small cars and mini-commercial vehicles to Indian customers.
The Maharashtra Government has signed a memorandum of understanding (MoU) with Beiqi Foton to facilitate the investment in the State. The company will get a waiver on VAT and other taxes. Khed district is home to many Indian auto majors and auto ancillary units. After this the company may consider similar units near Aurangabad and Kesurdi in Satara district, said a senior Maharashtra Government official.
The President of Beiqi Foton, Mr Jinyu Wang, said the Indian commercial vehicle sector is the world's fourth largest and is expected to grow rapidly. Beiqi Foton aims to create products suited to meet the needs of Indian environment and conditions, he said.
Mr R. Shankar, Executive Vice-President (India Operations), Beiqi Foton, said the range of products to be offered in the Indian market is yet to be finalised.
The company could consider supplying vehicles from India to neighbouring countries such as Sri Lanka and Bangladesh.
Commenting on the development, Mr Abdul Majeed, Auto Practice Head, PricewaterhouseCoopers, India, said that Foton has a good opportunity in the Indian commercial vehicle market as India's growth story is still being unwound.
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