Sports utility and tractor maker Mahindra and Mahindra
has entered into a joint venture with the third largest
truck manufacturer in the US Navistar International. The
joint venture company, to be known as Mahindra International,
will manufacture and market light, medium and heavy commercial
vehicles for Indian and export markets.
and Mahindra will have a majority 51-per cent holding
in the joint The combined investments of the two companies
is expected to be over $80 million over a two-to-three
year period, according to a statement from the two companies.
G Mahindra, vice-chairman and managing director of Mahindra
and Mahindra, said, "This JV will help us strengthen
our competencies across our core areas of product development,
engineering and manufacturing."
joint venture will enable us to widen our participation
in the auto sector in India, and our relationship with
Navistar will also support our aspirations to be a global
player," Mahindra added.
C Ustian, Navistar chairman, CEO and president, said the
joint venture gives the company "The opportunity
to participate in the economic growth of India and the
surrounding region, working with a partner of proven capabilities
and reputation." He further added, "This approach
provides both inherent cost savings and the advantages
International is expected to start production of commercial
trucks and buses in 2007 in a new state of the art facility,
which includes cab assembly, vehicle assembly and a paint
The vehicles that roll out of the facility will have 90
per cent local content due to the strong availability
of quality parts and materials from Indian suppliers,
the statement said.
part of the venture, the companies have opened a development
centre in India employing about 100 engineers, which the
company says would be tripled very soon. The engineering
process on the vehicles to be introduced in the Indian
market in 2007 has already begun.
has transferred its commercial vehicle business and its
line of light vehicles to the joint venture, Navistar
venture will use Mahindra & Mahindra''s distribution
network to launch a range of medium and heavy commercial
vehicles based on the Navistar unit''s existing product
platforms, Navistar said. The
venture also is expected to export vehicles through its
own distribution channel, as well as Navistar''s and Mahindra
& Mahindra''s overseas networks.