Ashok Leyland plans to set up plants in Kenya, Bangladesh
The Dollar Business Bureau
Ashok Leyland (ALL) announced it will establish its assembly plants in Bangladesh and Kenya.
The Chennai-based automobile maker plans to manufacture trucks in Bangladesh and buses and trucks in Kenya.
The company has also decided to scale up its capacity in Ras Al Khaimah (UAE) to 6,000 units per annum to tap the growing demand of African and West Asian countries in a big way.
“We will be investing $5 million in Kenya and the same amount will be invested by our franchisee in Bangladesh. Both plants will have an annual capacity of 3,000 units to be scaled up based on the demand,” said Gopal Mahadevan, chief financial officer, ALL.
Mahadevan said Kenya has emerged as a key market for ALL in the African region, and the company will utilise its Kenyan manufacturing plant to tap other African markets such as Ivory Coast and Senegal.
The African region was largely dominated by the Chinese firms, but now Indian companies, too, have started to make inroads into the region.
ALL had recently won $100-million orders from Ivory Coast and a $50-million orders from Senegal. “Being the first mover into these markets, ALL will naturally set to benefit. The company can also offer products at competitive prices,” Mahadevan said.
With these initiatives in the overseas countries, Ashok Leyland envisions to become one of the top ten truck manufacturers in the world over the next three-five years and to earn revenue from exports to about 1/3rd to its overall turnover compared to its current 1/4th.
“We expect to better the industry’s expected growth of 15% in current fiscal as we had done in Q1 with a 19% growth as against an industry growth of 15%. With the new emission Euro IV norms coming into place effective April 2017 and higher infra spend, we hope to post better growth,” he added.