Ashok Leyland, second largest truckmaker in the country, is in the process of establishing its assembly units in Africa, South America and South East Asia over the next three to five years, Gopal Mahadevan, Chief Financial Officer, said.
“We are looking to set up 2-3 assembly sites in Africa. We are devising East African and West Africa strategies and we have short listed Kenya as a possible market for setting up our first assembly unit,” Mr. Mahadevan said.
The company expects to invest up to Rs.30 crore in each assembly unit. The company is scouting for a local partner to set up the assembly operations. Cheap labour, tax benefits and savings on logistics cost are primary drivers for establishing the local assembly units.
The local units are likely to assemble buses initially and will start assembling trucks later. The company has been securing strong orders for buses from African nations such as Senegal, Zimbabwe etc.
Presently, most of the African markets are dominated by Chinese players. The Hinduja flagship company is confident of maintaining edge over Chinese players with its new truck series and local units.
Apart from Africa, Ashok Leyland is setting its eyes on South East Asia and South American markets. The three regions are expected to boost its export volumes over the next 3-5 years and the company expects the share of exports in revenues to grow to 25-30 per cent from about 10 per cent now. “The application areas and customer needs in Africa and South America are very similar to India,” he added.
Meanwhile, in India the company continues to gain market share in the medium and heavy commercial vehicle market segment. It has improved its overall market share to 30.1 per cent in Q3 of this fiscal from 26.7 per cent from a year-ago period.
While it claimed to have gained market share in all regions, it continues to dominate the southern market with more than 50 per cent share. In trucks, it has gained 2.8 per cent share to 28.1 per cent, while in buses, the company has improved its share to 47.3 per cent from 37.5 per cent.
