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Japanese auto maker Isuzu Motors India Private Ltd plans to establish a factory in South India with a capacity to produce one lakh units of light commercial vehicles (LCVs) and sports utility vehicles (SUVs).
The company, which has lined up three models—two LCVs and an SUV model—for sale in India as completely built units (CBUs) imported from Thailand, expects its factories in the two countries eventually to complement each other in serving the region.
Speaking to Business Line in Coimbatore today after the formal opening of its showroom here, Shigeru Wakabayashi, Deputy Managing Director, IMIPL, Chennai, said the Coimbatore showroom was the company’s first in Tamil Nadu and the second in the country.
He said his company had great confidence in the strength of the Indian markets and expected the market demand for passenger vehicles to zoom from 3.5 million units to 10 million units a year over the next 10 years.
Bookings
He said the company has just commenced bookings for its vehicles in India. While its SUV model carried an ex-showroom price tag of about Rs 23.2 lakh, the two pick-up vehicles were priced at Rs 6.65 lakh (single cabin) and Rs 7.85 lakh (double cabin). These vehicles come as CBUs from its factory in Thailand. Bookings have commenced but delivery is yet to start.
Showroom expansion
On the planned roll-out of showrooms in India during this fiscal and next year, he said while the first showroom was opened at Hyderabad, the second was opened today here. He said no roadmap for showroom expansion has been drawn up by IMIPL as the company would like to watch for the demand growth.
Explaining the reasons for choosing the South Indian cities for showroom openings at the start of IMIPL’s operations in India, the company’s Deputy MD said the factory was likely to be located in South India. While going for mass production, it would also like to understand customer preferences and, hence, the focus on South Indian cities in the beginning.
Market potential
Wakabayashi said his company was studying the market potential for establishing its own factory in the country. IMIPL was looking for a site in the South but has not finalised the location. He said: "We are in the final stages to decide it" and expected a decision on this in a few months. The investment amount for the project was not fixed yet. The ideal capacity would be about one lakh units a year, both LCVs and SUVs.
Questioned about the impact of rising diesel price on the demand for vehicles from IMIPL which is strong in diesel technology, he said his company’s forte was LCVs and SUVs and customers’ choice was diesel-powered vehicles that offered higher torque. Hence, the demand for diesel-powered SUVs would continue even if the price difference between petrol and diesel narrowed down.
On pricing of its products, Wakabayashi said IMIPL’s SUV model was priced in the same range as some of its competitors’ comparable products like Pajero Sport of Mitsubishi. But its pick-ups were priced higher than products from M&M and Tatas because of duties and stronger Japanese yen.
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