Biodiesel to cost Rs 28 per litre: DaimlerChrysler

With its research and development project on biodiesel to end soon, DaimlerChrysler India is hopeful that the use of the fuel would gain momentum in the near future.

The automobile major had initiated an R&D project in association with CSMCRI in Bhavnagar in Gujarat five years ago. The project was intended to gauge the feasibility of biodiesel generated from the jatropha seeds for which 100 acres were used for planting jatropha.

According to Suhas Kadlaskar, director (corporate affairs) of DaimlerChrysler India, excluding the taxes, the biodiesel would cost around Rs 28 per litre and would result in 70 per cent fuel cost reduction.

"At present the seeds are available for Rs 6-7 per kg which will help in pricing the biodiesel at Rs 28 per litre. As of now, the biodiesel can be used in any engine. However, we will be importing peripheral components like fuel pipe, fuel neck and fuel tank from Germany for customers who want to shift from petrol and diesel to biodiesel," said Kadlaskar.

Kadlaskar added that the minor changes in components will be made at the company's Pune plant.

The manufacturer of Mercedes-Benz brand of cars is setting up a new plant in Chakan near Pune with the objective of shifting the existing plant to the new one by 2009.

DaimlerChrysler India will also begin assembling high-end special application trucks "Actros" from the new plant for mining. Kadlaskar informed that the company had imported around 100 such trucks last year as samplers which cost around Rs 55-60 lakh.

Moreover, the new plant would also be used to expand the company's capacity of manufacturing cars from 4,000 to 5,000 by 2009.

"We are also hoping to begin manufacturing or assembling luxury buses at the plant. The overall investment on the new plant in Pune will come to around $50 million (approximately Rs 210 crore) which will cover the expansion as well as truck-assembling plans," added Kadlaskar.

DaimlerChrysler India sold around 2,121 Mercedes-Benz cars in 2006 of which 34 were sold in 2006. It expects to sell around 75 cars by the end of 2007.