Navistar to export truck cabins made at Chakan

US-based Navistar will source truck cabins for South American and West Asian markets from Mahindra Navistar Automotive, the 51:49 joint venture (JV) between Mahindra and Mahindra (M&M) and Navistar. The JV has already started exporting some components to Navistar in the US.

“The cabin has been accepted of international standards. We are in advance stage of talks with Navistar to supply cabins for trucks sold in South American and West Asian markets,” Nalin Mehta, MD at Mahindra Navistar Automotives (MNAL) told Financial Chronicle. According to him apart from cost advantages of sourcing from India, the design of the cabin made by MNAL too was accepted by the US partner. “US and other markets have nose shaped cabins, but now they want to introduce cabin with a flat front in international markets,” added Mehta.

Mehta, however, declined to disclose the number of cabins to be exported to South America and West Asia and the value of these exports or the cost advantage in sourcing cabins from India. MNAL is also in the process of exporting whole trucks made in India to South Africa, where they will be marketed and sold by Navistar. “We will also export our trucks to Saarc and Africa,” said Mehta.

MNAL on Tuesday announced pan-India launch of its trucks ranging from 21-49 horsepower. The company had done a pilot launch of the trucks in 2010. In the past one year, it has sold 2,500 trucks in India through 48 dealerships and 941 service touch points. The JV has invested over Rs 710 crore so far and expects to invest another Rs 290 crore in the second phase. The time frame for the second phase was not disclosed.

“The existing investments in the project have been funded with an equal mix of debt and equity. We expect to achieve cash breakeven level of operations in another 12 months,” said Pawan Goenka, president – automotive and farm equipment sector, M&M.

The national launch got delayed by four months, as the company did not have cowl cabin trucks. These trucks have adequate space for a driver’s seat as well as separate berths for an additional driver to rest on a berth within the cabin. “Cowl was not part of original strategy. But we realised that we are missing 70 per cent of market in the country. So we decided to develop cowl cabins for the domestic market,” added Goenka.

The Chakan assembly facility of MNAL has a capacity to produce 50,000 trucks per year, in three shifts. “At present, we are operating one shift and if required can be ramped up to 50,000 units per annum,” said Goenka.

MNAL also plans to launch a 49 tonne tractor-trailer and 25 tonne-mining tipper, with which it will be able complete its range of heavy commercial vehicles line-up. The JV is also working on 16 tonne, 50-seat air-conditioned buses for the luxury bus segment.

Separately M&M plans to ramp up the production of XUV500 to 3,000 units per month in January and 4,000 per month in February as the company has decided to open bookings of the vehicle next month. “We have not planned to go beyond 4,000 units per month of production till May-June 2012. But we intend to open up bookings in five to seven more cities from January 2012 in addition to the existing five cities,” said Goenka. M&M has received 8,000 bookings for XUV500, which will be delivered next month.

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