Videocon inks pact with US' York

The Rs 6,000 crore (Rs 60 billion) consumer electronics major, Videocon group, on Friday inked a distribution and marketing alliance with the US-based York International, the largest independent manufacturer of heating and air-conditioning solutions globally.

Following this tie up, Videocon will launch a new brand called York in the premium air-conditioning market. In the middle segment, the company will introduce York-Videocon brand.

Videocon has a 10 per cent market share in the air-conditioning market, which is largely derived from the mid-level segment. Its  market share is expected to grow to over 12 per cent by December 2005, Nipun Gupta, managing director, Aircon Technologies said.

The brands will be distributed by its distribution company, Aircon Technologies India. "If the initial arrangements work out, we will look at a closer, more fruitful relationship," Anthony J Abbot, vice president and general manager, York International Middle East said.  However, he refused to commit on a joint venture.

Gupta indicated that a joint venture could be in the offing. Though York International has a subsidiary in India, it has tied up with Videocon. This is in keeping with its global strategy to foray into new markets through a well-established player in that country.

York India has a presence in the industrial refrigeration sector. The company's claim to fame includes air-conditioning Pentagon, White House, Euro Tunnel, Petronas twin Towers, Sydney Opera, Kremlin, the Heathrow and Dubai airports.

The pricing for the premium segment has not been declared. For the entry-level products, the brands will be priced at Rs 10,000 onwards. A 1.5 ton air conditioner, for instance, will be priced between Rs 23,000 to Rs 45,000.