The company has finalised a fellow German technology partner and is in advanced process of selecting an Indian partner as a third player in the joint venture project. However the German company has decided to go ahead with the project with or without the involvement of a domestic player if talks fail to materialise with the Indian companies.
The initial investment for the project will be $310-320 million to be shared among the partners. Both German companies will hold 51 per cent in the JV only if an Indian player in taken aboard. An announcement to this will be made next month.
The company has finalised the site of the plant which would be located in the steel rich producing area of central India. The company will set up two units - forging and finishing within one of the country's special economic zones (SEZs). The plant shall be operational in the next 24-30 months.
The plant will have an initial production capacity of about 180,000 units, which would be eventually ramped up to 300,000 units a year. Of this, about 15,000 units would be targetted to be sold in India primarily with the rest to be exported to Europe, South America and Asia Pacific regions. About 60,000 units of black wheels will be exported directly to Germany from here.
The plant will essentially make high-speed compliant train wheels suitable for the German and other European markets. Besides, it will also make wheels for the metro rail transport and other locomotives.
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Since the train speed in India is substantially lower than the ones seen in western countries, it will receive relatively lower grade wheels suitable to the rails that can sustain a maximum velocity of about 180kms.
A company official said, "The demand from the Indian market for train wheels is about 15,000 units a year, but our facility will be producing much more than that basically to cater to the huge export market. We will be tieing up with a major European innovative wheel manufacturers."
In addition, the group on Friday announced that it will launch premium heavy trucks used for applications in the mining and construction industry in the domestic market in the second half of the year.
These trucks will be marketed in India through its Pune-based JV partner Force Motors and will be made available through direct imports from the company's manufacturing base in Italy. The company intends to sell about 500-800 such premium trucks in India by 2010-11.
Although the exact pricing details were not shared, the company officials said that it will be priced relatively higher than the trucks of Volvo and Mercedes, which are priced in the range of Rs 50 lakh-65 lakh. The homogolation process of the truck is currently being carried out in India that will define the products' road worthiness.
MAN Force Trucks, a 30:70 joint venture, has been selling medium and heavy commercial vehicle in the domestic market having a capacity of 16 tonne or more. The company aims to export 12,000 units, out of the installed plant capacity of 24,000 units, to Asian and African countries by 2010.