Volvo to make big-ticket Rs 2,000 crore investment in India

Bangalore, November 15: The Volvo Group will invest Rs 2,000 crore in India to expand its truck, bus and construction equipment business. Addressing a media conference in Bangalore, Olof Persson, president and CEO, Volvo Group, said: “India is a very important market for Volvo. We have invested, are investing, and will continuously invest.”

In addition to the Group’s investment, he said VE commercial Vehicles (VECV), the 50:50 joint venture with Eicher, will make an investment of Rs 1,800 crore which will be used for the modernisation of the Eicher product range, building an engine plant, exports, a new paint shop and test facility.

Persson did not specify the timeframe for both investments. He said, “It will be made in the coming years and it will be self-financed.” Further, he said the company will source engines from its engine plant in Pithampur for its global operations. By 2016, he said, the engine plant will be capable of exporting 30 percent of its production to Volvo’s other assembly units across the world. The plant, which is expected to go on stream in July 2013, will have the capacity to manufacture 100,000 units of engines by 2016, he added. Volvo will work with Eicher to increase localisation of parts in the engines manufactured at the Pithampur plant in Madhya Pradesh, Persson said. The VECV Powertrain facility has been set up as part of a global first initiative, reflecting synergies between Volvo and Eicher.

JAISHANKAR JAYARAMIAH