Amid challenging environment and growing competition in commercial vehicles, Tata Motors has earmarked Rs 1,500 crore in the 2014-15 fiscal for development and launch of new products in this segment.
“Tata Motors has and will continue to invest around Rs 1,500 crore a year, every year towards new products, variants, improvements, innovations and technologies for its commercial vehicle business,” Tata Motors Executive Director, Commercial Vehicle Business Unit, Ravi Pisharody told The Hindu.
He added, “This figure is for FY13-14 and will continue to be the same for FY14-15 too.”
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The sales of trucks and buses in India are witnessing their worst slowdown in more than a decade, as mining, infrastructure and construction activities have suffered in a slowing overall economy.
According to data by Society of Indian Automobile Manufacturers, sales of commercial vehicles were down 29.84 per cent to 47,982 units in February, the 10th straight monthly decline.
Additionally, Tata Motors’ commercial vehicle sales fell to 29,221 units from 52,175 units a year ago.
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The company's current capacity utilisation is around 60-65 per cent, Pisharody said, adding that Tata Motors will continue to manufacture as per demand.
The sector is hopeful of improvement in environment post the general elections in May this year. Industry experts expect the new government to roll out policies on various sectors, including mining, and approve new projects, which may give a boost to sales of commercial vehicles.
Tata Motors recently launched low-priced truck models under its 'Prima' brand — Prima LX to push sales, particularly in the high volume multi-axle truck segment. This series is about 20 per cent cheaper than the Prima range of trucks. Besides, the company is also launching T1 Prima Truck Racing Championship, to be held at the Buddh International Circuit near national capital on March 23.