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VE Commercial Vehicles, an equal joint venture between the Volvo Group and Eicher Motors, has lined up an investment of Rs 1,000 crore over the next three years for its various projects which include a bus body building plant as well as further investments in its engine plant.
VE Commercial's Chief Executive Officer, Mr Vinod Aggarwal told Business Line that the bus body building plant will involve an investment of Rs 125 crore and will be commissioned in 2013. The engine plant, for which Rs 288 crore has been earmarked, is coming up in Pithampur, in Dhar district of Madhya Pradesh.
Engine platform
At present, the body building is outsourced, and the new plant — which is expected to be commissioned in 2013 — will add to the overall capacity, Mr Aggarwal said. The new plant will have a total capacity of 10,000 units a year once it is fully operational. Last year, 7,000 units of bus bodies were supplied. All the buses are between 22-seater and 69-seater capacity and sold under the Eicher brand name.
Mr Aggarwal said the Pithampur plant is being commissioned this year and will be involved in the production and final assembly of Volvo group's new global medium duty engine platform. It will be the global hub for producing these engines which go into Volvo group's trucks and buses worldwide. Also, these engines will be used for Eicher's heavy duty commercial vehicles.
At present, the existing Pithapur plant produces about 40,000 engines a year and the new investment will add another 85,000 engines. The new engines will cater to all markets which have Euro 3 and 4 emission requirements.
Mr Aggarwal said the company has recently bagged an order for 400 heavy duty bus chassis from the Andhra Pradesh State Transport Company. He said the engine, as well as the bus body building plants will help the company bid for larger orders from various State transport corporations.
VE Commercial is a 50:50 joint venture between the Volvo Group and Eicher Motors and has been in operation since 2008. The venture was set up to manufacture the complete range of Eicher trucks and buses, its components and engineering design services businesses as well as sales and distribution business of Volvo trucks within India.
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