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Volvo mulls new models to spur growth

K Giriprakash

Heavy truck major AB Volvo plans to unveil a slew of new truck and bus models in India even as sales in the first six months of financial year 2001 (January -December) have been below expectations.

But the company hopes to reach the targeted sales of around Rs 3 billion for the entire fiscal on the back of good demand from September. In 2000, Volvo India mopped up sales of around Rs 2.05 billion. "We expect to break even by next year," Volvo India Ltd managing director Ravi Uppal said.

The company is also studying the possibility of introducing models from the Renault and Mack stables, the two companies, which it acquired recently.

"We will introduce a 3-axle tipper for the first time in the market and a tip trailer which can carry load up to 55 tonnes," Uppal said.

Volvo with its Indian partner plans to roll out around 400 air-conditioned coaches by the end of next year and manufacture its popular 'Olympian' multi-axle double deckers soon.

Volvo, which has entered into an agreement with a Bangalore-based bus-body builder, hopes to start rolling out at least 30 buses every month by the middle of next year.

He said the truck manufacturer had already invested around Rs 3.50 billion in the first three years of its operations in India. These investments are out of the Rs 5.25 billion funds earmarked for the country.

Uppal said the company has already sold around 1,000 machines during the last three years of its operations in India with 85 per cent being repeat orders from customers. He said the initial comprehensive service agreement is being extended for another two years for those customers who had a three-year agreement. "Our post-sale service is becoming extremely popular," he said.

While Mack sells very heavy-duty trucks, Renault VI's forte is in the area of light commercial vehicles and medium commercial vehicles. "We are studying the introduction of these brands in India but right now want to consolidate the offerings we currently have," he said.

Uppal said the 3-axle tipper for construction sector, which can cost between Rs 3.2 million and Rs 3.5 million will have a smaller body. It is expected to be unveiled by September. The tip trailer for transporting concrete mix can carry load up to 55 tonnes.

"It is becoming increasingly clear that bigger vehicles are replacing the smaller market because of lesser fuel cost. We now stand vindicated," Uppal said.

He also said that India is becoming a major global sourcing for various parts. It has tied up with Toyota for this purpose. Uppal said worldwide Volvo plans to unveil one model every year, which is the norm among car manufacturers. "This will stop spurious parts surfacing in the market," he said.

Volvo's Penta engines for Indian Navy, Coast Guard, port trusts and others had shown a growth of around 15 per cent. It has a market share of around 10 per cent in its 250-500 Kva power range.

The truck major also plans to introduce 85-160 Kva genset engine; 100-200HP industrial mobile engines, 700-1900 HP marine commercial engines and 80-350Kva marine auxiliary gensets.

Around 2,000 units of Volvo Penta have already been installed in the country, Uppal said.

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