Bajaj to make 4-wheeler commercial vehicles

India's second largest two-wheeler company, Bajaj Auto, has finalised plans to enter the four-wheeler commercial vehicle segment. The production would start in two to three years.

A greenfield facility to make the commercial vehicles would be set up in Waluj, Maharashtra, said Bajaj Auto's chairman Rahul Bajaj.

The company already has a plant in Waluj, where it makes two wheelers. Bajaj Auto executives said though the initial plan was to enter light commercial vehicles, the company would expand the range of the products to include medium and heavy vehicles too.

Bajaj Auto is also planning to enhance capacity and manufacture three million motorcycles a year, part of which will come up as a greenfield venture in Pantnagar, Uttaranchal.

The current capacity at its three plants in Akrudi, Waluj, and Chinchwad (Maharashtra) is 2.4 million motorcycles a year.

An estimated Rs 300-350 crore would be invested over the next year to expand the two-wheeler manufacturing capacity, including setting up a greenfield plant in Pantnagar, said a company executive.

The commercial production at the Pantnagar facility is expected to commence in the first quarter of the next financial year.

The company is acquiring 200 acres in Pantnagar, part of which will be used by 15 of its vendors, which will set up base there.

Although the financial plans for the commercial vehicle project have been finalised, the company officials refuse to divulge the details.

Interestingly, Bajaj Auto, along with Jamnalal Sons and Rahul Bajaj, holds about 23 per cent stake in Force Motors (formerly Bajaj Tempo), which manufacturers light commercial vehicles.

"I can hold stocks in any company. But as long as I am a passive investor, I can invest in another company even if in the same line of business," said Bajaj.

Force Motors has less 3 per cent share of the market.

The market for light commercial vehicles in India is dominated by Tata Motors and Mahindra & Mahindra""the two have over 90 per cent market share.

Early last year, the Firodias, the promoters of Force Motors, in spite of Rahul Bajaj's objections, changed the company's name from Bajaj Tempo to Force Motors.