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Isuzu Motors to invest Rs 3,000 crore for new facility in South India

December 11, 2013, 07:12 PM IST by Fleme Varkey
Isuzu Motors to invest Rs 3,000 crore for new facility in South India

Back in February this year, Isuzu India brought into the market, the D-Max pickup truck and MU-7 SUV. At that time, the cars were being brought to India via CBU and the MU-7 SUV was priced at Rs 23.75 lakh (ex-showroom Hyderabad). Now, Isuzu India has started CKD production of the BS IV complaint MU-7 and has pegged its price at Rs 22.4 lakh (ex-showroom Chennai). The MU-7 is also available in a BS III variant that is priced at Rs 22 lakh (ex-showroom Chennai).

This price decrease has been brought by the fact that the MU-7 SUV will be assembled at the Hindustan Motors' Thiruvallur plant near Chennai. Isuzu Motors has inked a "contract manufacturing" agreement with HML. The agreement between the two companies calls for the MU-7 to be manufactured by the Indian company even after the Isuzu plant goes online in 2016, as the Japanese firm is planning to increase the utilisation of local components to 70 percent by then.

Additionally, Isuzu will be spending Rs 3,000 crore for setting up their first facility in the country. They already have showrooms in Hyderabad and Coimbatore. This plant at Sri City will be operational by 2016 and will be producing light commercial vehicles and sports utility vehicles once functional. The Japanese car maker is already present in India through various partnerships like the SML Isuzu and Swaraj Mazda. Even the Chevy Tavera is basically an Isuzu Panther. Since the manufacturing cost in India is relatively low, Isuzu can also consider exporting vehicles from here.

Isuzu Motors India President and Managing Director Takashi Kikuchi said, “We are still in planning stage (of what will be manufactured from the company's plant at Sri City SEZ). After three years (by 2019), we want to have 100 per cent localisation.” He further added that the company would look at manufacturing one tonnage pay-load, pick-up truck from the Sri City facility. The firm would aim to serve domestic market from the Thiruvallur plant and also look at shipping to overseas markets from Sri City plant after 2016.

At the event, Kikuchi revealed that the company was looking at selling 5,000 units of MU-7 per year for the next three years.

Source: Economic Times

Tags:isuzu,Isuzu MU-7,MU-7
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