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Eicher to revamp truck, bus line-up

New products in commercial vehicle segment, upgradation of existing ones will take place during 2013-2015

Swaraj Baggonkar Mumbai
Despite the recent slump in demand for commercial vehicles, Eicher Motors Ltd is revamping its entire truck and bus line-up to strengthen its portfolio and boost market share.

The company, which has a joint venture with Sweden's Volvo, said developing new products in the commercial vehicle segment and upgrading existing ones will take place between 2013 and 2015.  Eicher will spend Rs 1,200 crore towards research and development, a new bus body plant and new products over 2013-14.

"We have about 15 trucks and six-to-eight products in the bus segment. We will have a fully renewed line-up with fully new generation products, which will hit the market in 2013 and continue to the end of 2015," said Siddhartha Lal, managing director and chief executive.

The company hopes to up its market share with the new launches. Presently, Eicher’s share in the 5-tonne and above segment stands at 12.7 per cent. In the heavy duty segment, its share is 3.9 per cent. Currently, over 80 per cent of the domestic commercial vehicle market is dominated by Tata Motors Ltd and Ashok Leyland Ltd.

Heavy discounting due to intense competition and rising inventory of trucks has led to a squeeze on the margin front, said Eicher. Its peers such as Tata Motors, Ashok Leyland and Mahindra Navistar have been giving out heavy discounts since the last few months.

Further, the Royal Enfield unit of Eicher will see a new production facility in Chennai coming on stream in the next two moths. Eicher, which saw sales of 130,000 units of Royal Enfield last year, is investing Rs 150 crore in the new facility. The company is also investing in increasing the capacity at its existing plant.

"The combined production capacity by the end of 2013 for Royal Enfield should be 150,000 units, but we are working for a better figure," added Lal. A new bike (Cafe Racer) from the brand will be launched in the second half of the year.

Meanwhile, the company said plans of jointly investing Rs 250 crore with its US-based partner Polaris Industries was on track. Both companies had agreed in mid-2012 to work on a new vehicle, addressing a new segment in the personal mobility space.

The Rs 250 crore includes developing, manufacturing and distribution costs of the new vehicle. Eicher Motors said it was hopeful of starting commercial production of the new vehicle by 2015.

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First Published: Feb 14 2013 | 12:32 AM IST

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