Ashok Leyland, Nissan defer LCV plant construction

Weak market conditions have led Hinduja group's Ashok Leyland to defer the construction of a new manufacturing unit near Chennai for producing light commercial vehicles (LCV). The vehicles however would be rolled out from its existing facility at Hosur.

"The construction of the plant has been deferred, but not shelved. We are discussing options with our joint venture partner Nissan, keeping in mind the current market scenario," Ashok Leyland chief financial officer K Sridharan said.

Ashok Leyland is India's second largest commercial vehicle maker, after Tata Motors.

"The vehicles will be launched as planned... Initially some models will be launched from our Hosur plant, while some other LCVs will come out from Renault Nissan's facility in Oragadam," he said.

In February earlier, the two firms were reportedly reviewing their business plans. (See: Ashok Leyland and Nissan review JV plans amid downturn)

The two firms had formed joint ventures last year for making LCVs, powertrains and developing technology. The plant at Pillaipakkam near Chennai is to be set up in collaboration with the Tamil Nadu government with an investment of Rs2,300 crore and a production capacity of 1 lakh vehicles. (See: Ashok Leyland and Nissan LCV plant to be located at Pillaipakkam)