Volvo Group today announced the introduction of the UD bus range, developed specifically for growth markets all over the world.
Company officials said after its introduction in India, additional growth markets would follow in the coming years. In India, UD buses aims to develop and lead the value segment, they added.
"India is growing,even though we have seen some trouble in last year and a half or two years,we certainly had good growth in the Indian economy over the last 10 to 12 years, with this growth comes in new aspirations, moving middle class and the need for more sustainable transport solutions which are better and smarter," Volvo Bus Corporation Senior Vice President - Region International Akash Passey told reporters here.
Stating that UD bus brand will expand Volvo group's customer base, improve competitiveness and capture growth opportunity in India, he said: "...The bus range will include both city buses and coaches."
The new UD bus range will be developed by leveraging Volvo group's global engineering network in combination with its heritage of Japanese craftsmanship and reliability.
Volvo said production of UD buses will start here in 2014. The first buses will reach customers later this year. Besides serving the domestic Indian market, the UD bus plant in India would also serve as an export hub for the future.
Stating that UD buses will operate under Volvo Buses India, Passey said "for the backup industrial footprint, as we see a big opportunity in this growing second largest market in the world for both premier segment and value segment, we see essentially exclusive needs of industrial system for both of them....We are well on our way to have a new facility ready by quarter 3 this year for manufacturing UD buses."
This would be done with a partner SMK, part of Prakash Roadlines group, he said,adding they are building the facility for Volvo for UD buses and that will be ready by Q3 this year.
On the nature of the JV, he said SMK was making the investment, while Volvo would have minority stake of about 15 per cent.
Asked about investment, he did not give a breakup, saying that including the investment of SMK and that of Volvo into the whole system and value chain and technology preparation, it would overall be about Rs 125 crore.
"The plant would be in Karnataka.... More towards Kolar, between Hoskote and Kolar," he said.
On production capacity, he said "the aim for UD buses is a volume of 2,000 to 2,500 buses in the coming years. Initial capacity will be of about 500 buses a year.
