With the dynamics of competition in the bus segment taking a newer twist in the wake of entry of organised players, commercial vehicle maker Ashok Leyland is gearing up to step up its fully-built buses' component to a higher level progressively.
Addressing a press conference after inaugurating the state-of-the-art Viralimalai facility of Irizar-TVS Limited, a three-way equal joint venture between TVS Sons Ltd., Ashok Leyland and Irizar of Spain, R. Seshasayee, Managing Director of Ashok Leyland, said 30 per cent of the buses sold by the company were built by itself at the moment. Ashok Leyland was keen to increase this percentage to 90 per cent over the next three years. During the next financial year, the company planned to take it up to 60 per cent, he said.
“We see the demand for buses, particularly for luxury segment, grow tremendously in India over the years due to Union government’s JNNRUM (Jawaharlal Nehru National Urban Renewal Mission) scheme, better road infrastructure and demand for seamless logistics connectivity across the country,.” Mr. Seshasaye said. “With engineering capability, quality and brand equity, ALL has decided to increase the number of fully-built buses,” he added. He insisted that the Government should continue with the JNNRUM scheme, which helped to meet the seamless road connectivity across the country.
The new facility of the joint venture company has come up with an initial investment of Rs. 30 crore with a built-up area of two lakh square feet. The plant has three production lines and seven paint booths with a capacity to produce 150 coaches a month.
The company also launched the indigenously-designed iT09. The joint venture company has now two manufacturing facilities - one each at Pudukottai and Viralimalai. The capacity of the company has gone up from 900 coaches per annum to 2,200 per annum. Irizar-TVS will be offering newer buses to the Indian market, which, according to Mr. Seshasayee, is largely customer-centric and driven by the preferences of customers.
Irizar-TVS buses go to certain parts of Africa and the Middle East via Ashok Leyland. Total sales of Irizar TVS clocked 600 units in 2009-10.
In 2007-08, sales touched 1,100 coaches. In 2008-09, the sales stood at 1,000 units. “This facility allows us to manufacture multi-variant products under a single roof. Customers can choose the type of chassis for their coaches,” he added.
Around 70-75 per cent of the coaches built by the joint venture company currently went to Ashok Leyland.
The rest went to other private players, he added. R. Dinesh, Director, Iriza-TVS, said much of the supplies to Ashok Leyland went to export market.