Sona Koyo plans power steering unit in Haryana

Automobile steering system manufacturer Sona Koyo plans to set up a new plant to make electronic power steerings (EPS) in Dharuhera, Haryana, with an annual capacity of 100,000 units. The investment envisaged is Rs 35 crore.

Sona Koyo chairman and managing director Surinder Kapur said the new plant would start commercial production next year.

Kapur added that Sona Koyo's stake in French auto component firm Fuji Autotech France SAS had come down to 17.5 per cent from 21 per cent due to its recent acquisition of a Brazilian and a Czech component companies. The French company's equity was expanded to fund the acquisitions.

According to Kapur, Sona Koyo has bagged an order to supply 50,000 units of EPS to General Motors for its new car code named 'D200'. The order is expected to be completed by 2007.

Sona Koyo's stake in Fuji Autotech has come down despite it holding the option to expand its stake in the company to 30 per cent in the next two year. Sona Koyo has picked up the 21 per cent stake in Fuji Autotech in October 2004 for $6.15 million.

The move to pick a stake in Fuji Autotech was to improve Sona Koyo's access to European markets. Apart from paying $6.15 million for the stake, Sona Koyo had also planned an investment of Rs 125 core spread over three years to fund capacity expansion.

The acquisition of the stake in the French company was Sona Koyo's first major step towards expanding its global footprint.

Recently, it has expressed interest in buying some of the assets of Delphi Corp, which recently filed for bankruptcy for its US operations.

The company's long-term plans for export market is to increase the share of overseas income to 45 per cent of its total revenues.