It’s the end of the road for MAN Trucks India. The German truck-maker has finally made it official that it is exiting the country and is now “actively seeking a third party to sell its manufacturing facility in Pithampur”.

At one level, the news is not entirely surprising since the company had recently made known that it was freezing all Indian projects. Only a die-hard optimist would have expected a reversal of that decision and it was clear that MAN had had enough of its innings here.

Never mind that the commercial vehicle industry is in the midst of its biggest boom in recent times and is expected to do even better in the following fiscal. Even as companies like Tata Motors, Ashok Leyland and VE Commercial Vehicles are struggling to meet demand, here is MAN that is actually shutting shop. Clearly, the company has reached the end of its tether here even while there were indications that it was determined to stay on and fight. The million dollar question now is who will end up buying the Pithampur plant.

Prospective buyers?

Could it be VE Commercial Vehicles, the Volvo-Eicher joint venture, which also has a facility in the same industrial belt? Likewise, will either Ashok Leyland or Tata Motors be interested? Or will the plant end up being abandoned like a host of others?

These are early days yet and it is difficult to predict what is in store for the MAN facility. There could be cause for hope going by General Motors’ experience in India. The American car-maker had brought the shutters down on its Halol facility in Gujarat last year and it was a matter of some months before its Chinese ally, SAIC Motor Corp, took charge.

Of course, the GM India workforce at Halol opted for separation packages or, alternatively, moving to its other plant at Talegaon near Pune. SAIC started off on a clean slate and is now working flat out to get its first vehicle rolling out of Halol in 2019.

The good part about the GM saga is that the plant was reclaimed and is now being rebooted for an all-new innings. Over 15 years ago, the Daewoo facility in Surajpur near Delhi was also on the radar for a revival. When the Korean parent declared bankruptcy, it was GM that emerged the knight in shining armour.

The company was reportedly keen on acquiring the Daewoo India plant, which was once home to the Cielo and Matiz. Somehow, things did not go according to plan and GM made little headway. The Surajpur plant then became home to a new entity, Argentum Motors, which was planned as a supply source for key components.

Nothing much came out of this eventually but at least one could argue that there was an attempt to revive an abandoned facility. GM, of course, set up the Talegaon plant and was on course to building its India presence. It was just a tragic irony that it decided to stop selling cars here and shut down Halol.

Reports have been doing the rounds for a while now that Talegaon could meet the same fate even while it has its role clearly defined as a key export hub for GM. It is impossible to say what could happen in the future but for now Talegaon remains relevant unless, of course, something extraordinary occurs, which will prompt a change in ownership.

Peugeot’s Kalyan plant

One of the earliest exits from India was Peugeot in end-1997, a move that sent shock waves across the extended ecosystem of suppliers, financiers, customers and employees. The Kalyan plant rolled out the 309 model and this abrupt decision by the French car-maker threw operations out of gear.

There were companies that explored the option of acquiring the plant for their own expansion plans. One of these was Mahindra & Mahindra, which had announced Project Scorpio, the all-new SUV, as part of its renewed focus in this space.

Some serious research went into studying the possibility of producing at Kalyan but M&M finally decided to drop the plan. Perhaps, one of the key reasons was apprehension on the labour front since the Kalyan facility had seen a lockout in 1996, which affected operations at PAL-Peugeot.

In fact, prior to its decision of exiting India, the French car-maker had reached out to Fiat offering it a part of the plant to make its own cars. The reasoning was that there was enough capacity here for two companies to contemplate joint production in a nascent market like India.

Fiat was not interested as it had plans for an all-new facility in Ranjangaon near Pune. There were then attempts to rope in Renault as an ally at Kalyan but nothing came out of this either. Meanwhile, Fiat shelved its plans at Ranjangaon and took charge of Premier Auto’s existing auto business at Kurla near Mumbai.

Nothing really worked for Fiat and it finally returned to Ranjangaon, albeit in a completely recast business model with Tata Motors as the joint manufacturing ally. This plant is now home to the successful Jeep Compass while Kurla remains a distant memory. The few remaining Premier Padmini taxis in Mumbai serve as a reminder of their erstwhile home and it is only a matter of time before even they slip into oblivion.

Like the Premier Padmini, another iconic Indian brand bid adieu in 2014 when its manufacturer decided that its production was no longer viable. The Ambassador was synonymous with Hindustan Motors and its home in Uttarpada, West Bengal, for many decades. However, with a dwindling customer base, it was becoming increasingly difficult to sustain operations and finally the curtains came down.

Today, Peugeot has acquired the Ambassador brand as well as HM’s other facility in Tiruvallur near Chennai as it plots its India comeback. Perhaps the MAN Trucks plant in Pithampur will just find a suitor who could keep it going for many years longer. It will, otherwise, join a lonely list of abandoned plants and gradually fade away into history.

 

Down in India, going strong in Europe

 

It could be shutting shop in India but MAN Truck & Bus is doing well in Europe’s key markets. The Volkswagen group brand reported a record order in June 2018. Between 2019 and 2022, MAN is set to supply up to 1,000 of its new Lion’s City and Lion’s Intercity buses to 31 regional bus companies of DB Regio AG in Germany.

DB Regio is Germany’s biggest operator of buses and a long-standing customer of MAN Truck & Bus. Sixty one hybrid Lion’s City buses are set to be operating on the roads of Warsaw, Poland, in the future, helping lower emissions. June 2018 marked the start of the practical phase of the joint research project on platooning, which is run by MAN Truck & Bus, DB Schenker, and the Fresenius University of Applied Sciences.

A platoon made up of two connected MAN semi-trailer tractors drove from the DB Schenker center in Neufahrn, Munich, to Nuremberg for the first time. The regular test drives to take place on the A9 highway between Munich and Nuremberg are intended to put platooning to the test.

The eTGE, an electric van launched in March 2018, does its bit for electric mobility. With a range of up to 160 km and a load capacity of up to 1.7 tonnes, the eTGE is perfectly suited for urban and zero-emission distribution needs. The serial production of the eTGE began in July 2018.

MAN Truck & Bus’s activities in the field of digitisation also include a partnership with Solera, which was set up in March 2018 with a long-term horizon and the aim of pressing further ahead with digitising after-sales connectivity. This includes the use of Digital Garage, a Solera platform, in the future.

 

 

comment COMMENT NOW