Isuzu Motors to establish manufacturing unit in India; Tata, Mahindra major competitors
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The Japanese based auto giant, Isuzu Motors is betting high on the Indian auto market with a plan to set-up its first production facility in the country, worth speculated investment of Rs. 1,000 crore. Carrying a reputation of being the most popular midsize truck manufacturer in the world, the company is already associated with an Indian brand Swaraj Mazda, under the head of SML-ISUZU. However, it only assists the domestic company by providing advanced diesel engines equipped with latest technology.
In order to decide best-suited locations for establishment of a new plant, the Indian representatives of Isuzu Motors are in talks with government officials of different states. Regions like Andhra Pradesh, Tamil Nadu and Gujarat are on the cards of the auto maker for installing their new unit. The state officials of Andhra Pradesh have stated that a manufacturing unit in Nellore district has been proposed by the company officials. It is speculated that the plant will have a production capacity ranging from 100,000 to 120,000 units per year and is expected to start its operations by 2014-2015. The auto maker targets to sell 1,500 units by the end of its first year.
At present, the Indian industry has a dominance of domestic players, since it does not have any international truck maker, and the segment is growing with an annual surge of 20 per cent. With the debut of a new brand in the midsize truck segment, the sales figures of Indian companies are anticipated to dwindle a little.
K. Pradeep Chandra, Principal Secretary (Industries), Andhra Pradesh State Government, says, "Isuzu have shown some interest for setting up one of their units here. They have huge range of products starting from cars to LCVs all the way to pick up trucks and heavy trucks. We don't yet know which specific model they are looking at manufacturing here."
For the time being, before establishing a full-fledged manufacturing plant, the company is looking ahead to set-up an assembly unit and distribution centre in the country. Analysts believe that Isuzu might establish its assembly unit in Chandigarh, wherein a manufacturing unit of Swaraj Mazda Limited is also carrying out its operations. Japanese conglomerate Mitsubishi, which has a stake of 9.2 per cent in Isuzu Motors, runs a plant in alliance with Hindustan Motors at Tamil Nadu.
Presently, Isuzu is planning to route its lifestyle pick-up truck DMAX and other Sports Utility Vehicles (SUVs) in the country as Completely Built Units (CBUs) and Completely Knocked-Down (CKD) kits. The Utility Vehicles (UVs) segment in India still has ample space as there has been no major competition. Vehicles like Ace, 207 DI, 407 and Magic are some of the dominants in this segment, which are all offered from the stables of Tata Motors. Mahindra has also offered quite a few commercial mini-trucks and pick-up vehicles in this segment.
With keen attempts to gain popularity around the world, Isuzu aims to make the most out of its upcoming Indian plant. In order to carve a special niche in the Indian auto sector, Isuzu Motors is required to work according to the demands of Indian consumers and offer its vehicles with the right pricing.
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