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Indian motor company puts its money on South Africa
The Indian motor company, Ashok Leyland, has given a thumbs-up to the South African motor vehicle industry, saying it planned to invest R50 million in KwaZulu-Natal over the next two years.
Ashok Leyland entered the South African market three years ago basing its sales office in Gauteng, with a number of dealerships around the country.
Christu Thomas, the regional manager of Ashok Leyland South Africa, said that the company planned to establish a motor assembly plant in KwaZulu-Natal and had chosen two local businessmen, Lucky Moloi and Deena Pillay, as its black economic empowerment partners in a joint venture called East Coast Bus and Truck.
The joint venture will set up six dealerships and has identified opportunities in Durban, Pietermaritzburg, Richards Bay and Port Shepstone. The company has set a target of 100 buses and 50 four-ton trucks within five to six months after the plant goes into operation and a long term target of assembling 200 vehicles a year.
This new investment comes hot on the heels of Tata’s recent R650 million investment in a ferrochrome plant in Richards Bay. Tata has so far invested over R9 billion in the iron, steel and motor vehicle industries in South Africa and has plans to invest further in the hotel industry.
Thomas said that Ashok Leyland would be focusing on smaller trucks and buses in the South African market, but had plans to expand its fleet.
"We are looking at an average manufacturing rate of 30 vehicles a month, but a lot will depend on the market." The investment includes a budget for local skills training. Middle management and workshop supervisors will be trained at Ashok Leyland headquarters in India.
The company imports its chassis from India and outsources the body work and assembly of buses and trucks to manufacturers in Gauteng. Ashok Leyland is one of the top makers of commercial vehicles in India and exports to Mauritius, the Middle East and Australia.
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