To invest Rs. 300 cr. in Uttaranchal unit
New plant will become operational by May 2007To launch seven new models this year
NEW DELHI: Hero Honda will set up a new pant in Uttaranchal and it will become operational by May 2007. The auto major will invest Rs. 1,900 crore including in ancillaries by 2010.
Making a formal announcement about the third plant, the company, which is now running two plants in Haryana, said the Uttaranchal plant would start operations with an initial investment of Rs. 300 crore and a capacity of five lakh units to be scaled up to 15 lakh by the year 2010. A company statement said the new plant and its main ancillaries would be located on a 275-acre plot in the Integrated Industrial Estate in Haridwar, being developed by the State Industrial Development Corporation of Uttaranchal Ltd.
The new facility will enable the company to realise an annual production capacity of 44 lakh units by May 2007 as it is already expanding capacity at its existing plants at Gurgaon and Dharuhera by an additional nine lakh units by this month end.
Significantly, Uttaranchal has managed to steal the march over Rajasthan as the company had proposed to set up the third plant in Jaipur.
Hero Honda is the second major bike company, after Bajaj Auto, to set its foot in the hill State where the Central Government offers 100 per cent excise exemption for ten years and 100 per cent income-tax exemption for the first five years and 30 per cent for the next five years, among other incentives. Other auto companies that have entered the State include Tata Motors and Mahindra and Mahindra.
Hero Honda Managing Director Pawan Munjal said the company had an aggressive strategy of consolidating market leadership through growth in the domestic and export markets.
"We will be launching seven new models this year and have similar plans for the future to offer customers an unparalleled range of state-of-the-art two-wheelers that will offer the world's best technology, latest design options and many exciting new features,'' he said.
The company has received a letter of allotment of land from the Uttaranchal Government.