Mercedes-Benz is planning to roll out its new intra-city bus range in January, with the Auto Expo in Delhi as a platform. It has set up a new captive bus body line at its Chakan facility for this range, jointly with its Egypt-based global partner, MCV.

“We're already in the next phase of setting up a new line at Chakan. It's half ready and only the machinery has to come,” said Mr Peter Honegg, Managing Director and CEO, Mercedes-Benz India.

The German automaker, which also sells its luxury car range in India, expects to end the year on sales of 150-170 units of its existing inter-city bus range. For the inter-city buses, it only makes the chassis, while domestic partner Sutlej makes the bus body.

“Much of our domestic inter-city bus sales are to private owners. One such customer bought 80-90 buses this year,” Mr Honegg said.

Competing with Volvo

As Mercedes' new bus body plant gets built at Chakan by end-2011, the company may also look to shift its inter-city bus body contract to its global partner MCV from Sutlej. Mercedes' biggest competitor in the luxury inter-city bus segment is Swedish automaker Volvo – which has an over 70 per cent share of the 1,000 units a year market.

“To compete more aggressively with Volvo, the company could look to shift its bus body unit to its captive plant (with MCV) and not use an outside partner. This will help it significantly reduce costs,” said an industry source.

Curerntly, the plant which makes both trucks and buses has a capacity of 1,200 units a year.

> roudra.b@thehindu.co.in

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