Japanese two-wheeler major Yamaha has initiated dialogue with the Tamil Nadu government to set up its third plant in India. According to market sources, the new facility is expected to attract investment of Rs 100 crore.
State Finance Minister O Panneerselvam said: "Their [Yamaha's] proposal is one of the major investment proposals which the state has received, we are in advanced state of negotiations."
Roy Kurian, national business head, India Yamaha Motors confirmed the development saying, "We are in talks with the Tamil Nadu government for a new facility and we are in the negotiations stage. Details are yet to be finalised."
He declined to specify the capacity and the investment the company was considering for the new plant.
Meanwhile, market sources said that the company was planning to set up a facility, similar to the one in Uttar Pradesh.
India Yamaha Motors, at present, has two facilities at Surajpur in Greater Noida and at Faridabad. The Surajpur plant has the capacity to roll out 600,000 motorcycles a year which can be expanded to one million mark. The facility at Faridabad can manufacture 700,000 engines, besides other components.
The company is targeting a 10 per cent share in the domestic two-wheeler market over next four years. Yamaha accounted for 2.7 per cent of the 12.52 million two-wheelers sold in the Indian market till February.
To strengthen and consolidate its presence in the two-wheeler market, Yamaha is further gearing up to foray into the fast growing scooter segment in the country. The all-new product that parent Yamaha Motor Corporation (YMC) is developing specifically for the Indian market is expected to hit Indian roads sometime in the coming financial year.
Yamaha grew by 29.36 per cent to sell 325,678 units in the domestic market between April 2011 and February 2012.
