Ashok Leyland on Expanding Spree, to Set-up Two Bus Units in Africa

India's second largest commercial vehicle manufacturer, Ashok Leyland has announced that it is currently making plans to set up two assembly plants in the African continent for producing buses. The Chennai based firm had initially planned to increase its production capabilities in UAE and now it is looking to do the same in Africa. Ashok Leyland believes that having a local manufacturing facility would help create greater impact in the region. In addition, the manufacturer has also hinted about its intentions to set up plants in the countries of South America and South East Asia.

Ashok Leyland sees Kenya as a strategic region in the continent and is currently looking out for other locations in Africa. The Hinduja Group's flagship brand is aiming to commence the operations on proposed plants by the fourth quarter of FY2016. The company's CFO, Gopal Mahadevan has said in a statement that the African based plants will assemble the buses as Semi Knocked-down and Completely Knocked-down units.

“There are advantages being with a local partner out there as it would help in roping in dealers and spreading the brand image more effectively. Since these being assembling units, the company does not need to pump in big investment, each plant will cost close to R30 crore, or less than that,” said Mahadevan.

Mahadevan views Africa as a potential market for its vehicles and said that the company has the ability to deliver quality products at a very reasonable price. In India, Ashok Leyland is making big gains with surging domestic and international sales. Now, it will be interesting to see how this Indian firm tackles the competition overseas.