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Hindustan Motors mulls to partner with automajors for Chennai plant

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Days after the Hindustan Motors (HM) board decided to hive off the Chennai facility to a wholly-owned subsidiary, the beleaguered automaker today said, the company was exploring  options of roping in automobile multinationals to get them to outsource some of their manufacturing to the plant.


“The demerger is being done so that business units pursue their respective growth plans as appropriate. For Chennai plant there are options, collaborations with some other players is also one option,” Uttam Bose, managing director of Hindustan Motors said.

 



The Chennai plant in which HM manufactures Cedia, Outlander, Pajero and Montero in technical collaboration with Japanese automaker Mitsubishi, has an installed capacity of 24,000 units per year. However, there is ample idle capacity as the plant produced only 3,000 units last fiscal.

According to company officials, investment by Japanese car maker Mitshubishi is also one of the possibilities post-demerger. As of now, there is no equity participation from Mitshubishi in the facility.

The board of the CK Birla group company has recently decided to demerge and transfer its Chennai plant to its fully owned subsidiary organisation Hindustan Motor Finance Corporation Limited (HMFCL).