Volvo plans to double funds for India JV

Volvo Bus Corporation, a part of the Swedish Volvo group, is planning to more than double its investment for the new Indian joint venture, Volvo Bus Body Technologies India (VBT), by 2010. Its current investment is Rs 80 crore.

The fund will be used to increase the company's bus body-building capacity at its Bangalore plant, Rune Lundbberg, senior vice"�president, Volvo Bus Corporation said.

VBT is opening its new manufacturing facility, costing Rs 80 crore, through a joint venture with Azad group at Hoskote near Bangalore on Thursday. Initially, VBT will produce 450 buses and by 2010 the unit will reach its full capacity of 1,000 buses, he said.

He said, "We have an installed capacity to produce 1,000 buses per annum by 2010 at Bangalore. When we reach this capacity we need the next-level of investments in India."

The company may source automobile components from India. "We are yet to work out when to start the sourcing from India. We are in talks with a number of vendors and suppliers," Lundbberg said.

These components will be sourced for Volvo plants in the US, Europe, South America and China, said Hakan Karsson, president, Volvo Bus Corporation.

"We have knowledge and experience to build bus bodies and we will transfer that technology to the new JV to produce fully built buses for both India and export markets such as West Asia, Africa and South East Asia," he said.

Apart from producing fully built buses, Volvo Bus Body Technologies will also develop new products, he said.

In 2007, Volvo sold over 200 buses in India and in the current year, it aims to achieve 120 per cent growth, said Akash Passey, managing director, VBT.