Engines and component maker Cooper Corporation is looking to launch an indigenously-developed light truck next year to take on the market leader, the Tata Ace.
The company is looking to tap into the demand pool for four-wheeled products which can carry a payload of 0.5-1.5 tonne and be extensively used in villages and towns. The company will spend Rs 130-140 crore as development cost of the light commercial vehicle (LCV), most of which is developed in-house. The cost of development of its engines, which the company has developed in partnership with Ricardo of the UK, is additional. Some aspects related to the vehicle's design and engineering is outsourced.
Farrokh N Cooper, chairman and managing director, Cooper Corporation said, "We have completed the work on engine and work on the LCV is on. We are trying to meet the deadline of the Auto Expo (2012), but the vehicle will be launched only next year."
There will be at least six variants of the LCV, including passenger versions. Another Tata Motors product, Magic, has the lead in this segment. All products will be branded as Cooper.
The company has developed a 1.5 litre engine, which has naturally aspirated and turbo charged variants. The diesel-fired twin cylinder engine can generate peak power of 55 bhp in the turbo-charged model.
The company is setting up a manufacturing facility in Satara, Maharashtra, with an initial capacity for 20,000 units per annum. This capacity, according to Cooper, will have to be increased by at least 50 per cent anticipating the spurt in demand for such vehicles.
As part of its expansion plan, the company is also looking to hit the capital markets before the end of this year to raise a minimum of Rs 150 crore. Most of the proceeds will be used towards expanding the manufacturing capacity and towards product development.
"Our growth has been 30 per cent last year and we are targeting a turnover of Rs 500-600 crore in the next two years, aided largely by revenues generated by the engine business. We will likely file a draft red herring prospectus in the next six months," said Cooper.
The LCV segment has seen interests from most vehicle majors, including Mahindra & Mahindra (M&M), Ashok Leyland-Nissan, Force Motors, Hindustan Motors, Piaggio and Asia Motor Works. These vehicle are priced in the range of Rs 2.5-3-5 lakh.
While M&M saw demand for its Maxximo light truck swell to more than 3,000 units, Ashok Leyland-Nissan recently launched a LCV developed by the joint venture christened Dost, which would be launched in the second quarter of this year.
Tata Motors sells more than 20,000 units of the Ace and Magic every month.