Leyland gears up for the LCV marathon

After parting ways with Nissan Motor in its light commercial vehicle venture last year, Ashok Leyland is now planning to recreate the magic in this space. It has earmarked ₹400 crore to launch a slew of products that will help take on established players such as Mahindra & Mahindra and Tata Motors.

Leyland had bought out Nissan’s stake in three joint ventures while acquiring the rights for domestic and export markets. “All products, variants and modifications, which we intended to do in the last three years will now happen,” says Nitin Seth, President, LCV and Defence. “We lost two years of good time and have to run faster.”

And even while the LCV segment has not grown well in recent years, it is still a 4.5 lakh-per-annum space estimated to touch six lakh units in three years. However, Seth admits that the going will not be easy for Leyland unless it fills the product gaps. Hence, the objective now is adopt a two-pronged strategy where a slew of variants can roll out of the existing IPR platform.

Alongside, the company plans to develop new products to fill key gaps in the LCV space. From its point of view, these exist in all categories right from the sub-one tonne to six tonnes. This is equally true for both monocoque and non-monocoque buses where, for instance, there is a need for small 13-seater buses.

“We have to invest for the short-term and then plan for the long-term play after seeking the board’s approval,” says Seth. Within 2-3 years, we will definitely invest ₹400 crore.”

Leyland sees huge potential in the Middle-East for left-hand drive versions of the Partner. It is also aware that markets like Russia have a different set of specifications for emissions and safety.

“We need to spend and focus on these requirements. The idea is to go all out both here and abroad,” he says. This is where variants of the Dost and Partner will have a role to play. Eventually, Leyland is keen on taking a 20 per cent share of the six-lakh strong LCV market in India.

With technology now easily accessible, Seth is not unduly worried about finding an ally. “You don’t need that one big tie-up any longer. Today we have the base platform and can enhance it by bringing in individual players,” he says.

With a reasonably strong network of 375 outlets for LCVs, Leyland believes it just needs the right set of products. “Servicing will not be an issue and our dealers are hungry to do more,” says Seth. “If you have a good network backed by strong training, vehicles can be fixed in an hour.” This is equally true for the new Bharat Stage IV range which account for 60 per cent of Leyland’s LCV sales.

The other priority is to steer clear of price wars and continue the premium positioning in this space. For now, the company is keen on optimising capacity at its Hosur plant which means producing 55,000 units annually from the present level of 35,000 units. This is where the new variants will play a big role. Beyond this, the goal is to increase numbers to 1.2 lakh units with new products being the growth engines. As Seth says, “We are raring to go and now need to run.”