German auto maker Daimler AG has decided to consolidate its truck manufacturing operations in India. As part of the plan, it will shift the production of Actros from Pune to Oragadam in Tamil Nadu.
The company launched the facility in Oragadam on Wednesday. It will manufacture the BharatBenz trucks and all commercial vehicles there.
The Rs 4,400-crore facility will have an initial capacity of 36,000 units, including 24,000 units for heavy duty trucks and 12,000 for light duty trucks under the BharatBenz brand.
The capacity could be raised to 70,000 units per annum, said Dieter Zetsche, chairman of the board of management of Daimler AG and head of Mercedes-Benz cars. The facility is spread over 400 acres.
Zetsche said India was not just emerging, but thriving. The exceptional role of the economy was a matter of fact — not next decade, not next year, but today. “If India’s economy were in Mercedes, it would have to be an SLS AMG super sports car.
“If you don’t make it here, you won’t make it at all. Because a strong position in the global market requires a strong position in India and at Daimler, we always go for the leading position in our industry. That’s why India will play an increasingly important role in our business”.
The company said it could join hands with the Renault-Nissan alliance for commercial vehicles in India, although there was no immediate plan.
Zetsche said, “Though we don’t have any plan now, we don’t rule out the possibility. Our partnership is not restricted to any region. It is possible to do something together in India as well”.
Daimler and Renault-Nissan build commercial vehicles together in Europe.
The Oragadam facility can roll out one heavy duty vehicle every 11 minutes and one light duty vehicle every 22 minutes. The new plant will make light and heavy duty trucks in the 7-49-tonne range and is meant for both domestic and international markets, including Asean and Africa.
“Our priority is the domestic market, once we address the domestic market, we will look at exports,” said Andres Renschler, member of the board of management at Daimler AG and head of Daimler Trucks and Daimler Buses.
The first of these trucks, used in construction, mining and on highways, will be rolled out in September, he added.
According to compay sources, the vehicles will have 85 per cent localisation. Besides assembling, the facility will also have a power train facility to cater to heavy duty trucks, with a capacity of 24,000 engines. For light duty vehciles, the engines will be manufactured at Pithampur in Madhya Pradesh.
A separate facility, within the Oragdam plant, will be created to manufacture the Actros trucks, which are high-end heavy duty trucks and the largest-selling truck model worldwide.
According to a Daimler India Commercial Vehicles (DICV) official, the company wants to have all truck manufacturing in one location while cars will be rolled out of the Pune plant.
DICV will also shift its research and development (R&D) team to the plant site though from a different location in Oragadam. Currently, the auto major employees around 1,000 people in its R&D unit.
The official said 85 per cent of the components were locally sourced.