Truck makers look at 'body builders' for tie-ups

Truck and bus making companies like Tata Motors and Ashok Leyland are looking at outsourcing the body-building processes to trim costs, boost supply channel network and reduce dependence component suppliers.

Tata Motors, the country’s largest commercial vehicle-maker with a 65-per cent market share, is in talks with a few truck body builders, asking them to set up facilities close to the company’s manufacturing units.

Similarly, Ashok Leyland, Volvo Eicher and Man Force are working towards handing over more body building contracts to third parties for trucks, according a senior industry executive. The original equipment manufacturers will continue to make and supply chassis.

Traditionally, customers bought chassis and would mount bus body at a later stage.

Ravi Pisharody of Tata Motors says the company is now encouraging body builders to set up shops in Jamshedpur, Pune or Lucknow. “Thus the chassis don’t have to travel to another location; we can avoid the transit time.”

Result: a company like Commercial Engineers and Body Builders Company is sensing a substantial increase in orders from commercial vehicle makers. It executive director Ajay Gupta says his firm currently has more than 20 per cent of CV sales coming from body building contracts given to body builders. “We are expecting this to grow to 100 per cent in the next three to four years.”

Manufacturers say that demand for trucks will remain upbeat in the long run despite the current hiccup in sales due to the slowdown in infrastructural and mining activities in the country.

During April-September, the sales of medium and heavy commercial vehicles grew by six per cent to 160,535 units as against 151,370 units sold in the same period last year. While domestic sales of Ashok Leyland in the same category fell by 12 per cent, Tata Motors sales grew by 12 per cent during the same period.