Daimler to pump Rs 275 cr in plant, products

Luxury car manufacturer DaimlerChrysler India Ltd said here on Wednesday it will invest Rs 275 crore on the new facility is will construct at the MIDC's Chakan industrial estate near Pune over the next two years.

The new manufacturing facility, coming up over 40 hectares, will manufacture the C Class, E Class and S Class cars for the India market, Wilfreid Aulbur, Managing Director and Chief Executive Officer for DaimlerChrysler India told reporters on the sidelines of a function to mark the laying of the foundation stone for the new facility. Maharashtra Chief Minister Vilasrao Deshmukh laid the foundation stone.

Aulbur said that the company will make 5,000 cars at the plant where production is expected to begin in the early part of 2009. He indicated that the company may make its Actros heavy duty trucks at the plant.

"The truck is doing extremely well since its launch last year and we are considering increasing the production of Actros in India though a firm decision is yet to be reached," he said.

Actros presently comes as a completely built unit and Daimler Chrysler may consider bringing in completely knocked down kits to make the trucks here. Actros sold 50 units in 2006 and we expect this figure to grow sunstantially, Aulbur said.

DaimlerChrysler may think of bringing other products into the lower segments if it thinks the market is ready for it, said Joachim Shmidt, chairman of the board, DaimlerChrysler India.

"We will take a view when the plant is ready in 2009 though nothing concrete can be spelt out now," he said.

Aulbur informed that the extent of localisation of the C class vehicles is 50 per cent and a little less than that for the E Class and S class.

He said that there are issues of excise duties which have been holding back the company from increasing the production and effectively, localisation.

According to Aulbur the company sold 2,121 vehicles in 2006 which is a rise of 11 per cent over the 1,915 vehicles sold in 2005.

The company intends to sustain and increase this growth rate as the vehicles are getting wider acceptance among the high income groups, he said.