Mahindra Navistar Automotives, a joint venture between Mahindra & Mahindra and the US-based Navisar International Corporation, on Tuesday said it plans to invest Rs 250 crore at the Chakan unit to ramp up the commercial vehicle manufacturing and distribution network.
“We have already invested Rs 710 crore at the Chakan unit, out of the total project cost of Rs 1,000 crore. We will be investing around Rs 250 crore in the next couple of years to increase production capacity of HCVs and expand our distribution network,” Mahindra Navistar director Pawan Goenka told reporters in Mumbai. The company has Rs 750 crore of equity and 50-50 invested by both the partners along with debt.
“We are not making any profits, as our volumes are very small as present. But as we ramp up our production capacity, in the next 12 months, we expect cash break-even,” Goenka said.
After announcing start of production and subsequently start of sales last year, the company on Tuesday announced its national launch. After launching MN25 in heavy commercial vehicles (HCVs) category, the company is now offering the MN31, MN40 and MN25 tippers.
“After seeding sales in select markets and building a formidable service network of nearly 940 service points on strategic trucking routes, it is all set to take on the length and breadth of the country through its commercial launch. Today, we are a full range commercial vehicle player with a pan-India service network dedicated towards our customers,” Goenka said.
“During one year period, we have gained adequate market experience and customer feedback to significantly enhance the performance, fuel efficiency and value of our products. We can proclaim that all our products are truly made in India.”
“We propose to launch products like the MN35, MN49, MN25 Heavy duty Tipper (for mining) and certain other model variants during the next financial year,” MNAL’s managing director, Nalin Mehta said, adding that company is also looking at entering into bus manufacturing segment.
During last one year, the company has expanded its dealerships to 48 and hopes to add another 50 to get ready in the next 12-18 months taking the grand total to 100, he said.
The current monthly sales volumes of the company are headed towards 1300-1400 units (300-400 HCVs and 900-1000 LCVs a month). Of its new HCV range, over 2500 trucks are already plying across Indian roads, catering to various customer needs or business solutions, Goenka said.
Commenting on the future plan, Goenka said, the Rs 60,000 crore, commercial vehicle segment in the country is likely to grow by 9 percent in the second half of FY12 as compared to 8 percent growth witnessed during the first half of FY 12.