Saturday, June 12, 2010

Volvo Truck Engines To Be Produced In India

Commercial Vehicle Cooperation to be "Most Advanced Manufacturer"
Shipping News Feature

INDIA – VE Commercial Vehicles (VECV), the joint venture between Volvo and Eicher Motors, is set to produce a new medium duty truck engine at it’s plant in Pithampur, India. We have looked before at the blossoming of freight truck development on the subcontinent and now VECV will invest £42 million to produce engines to Euro III and Euro IV emission requirements for all Volvo’s global markets. Development of the new engine has been led by Volvo Powertrain in Ageo, Japan who will attend to final assembly of the engines for the Japanese market. Final assembly of the engines for the European market will take place in Venissieux, in France.

Production of the medium-duty engine, which comprises five, seven and eight-litre engines, in configurations from 215–350 horsepower is expected to commence in 2012. “Asia is an increasingly important market for the Volvo Group, with excellent growth prospects and the investment means that we will have even better possibilities of developing products adapted for this part of the world, thereby allowing us to capitalize on this growth,” says Volvo CEO Leif Johansson.

“By gathering base engine production in India, it will be possible for us to meet the Group’s need for cost-efficient medium-duty engines in Asia, while also contributing to an increase in our competitiveness in the medium-duty segment in other markets.”

Although Volvo will actively pursue the Indian home market like Mercedes and Daimler Benz before them, once again it seems that a traditional European vehicle manufacturer is looking for a cheaper alternative production line overseas with home markets simply operating a finishing operation. . VECV has an established supplier base in India and efficient purchasing channels and already today, VECV produces about 40,000 engines per year in the existing plant. The investment in Pithampur will result in an annual production capacity of an additional 85,000 new medium duty base engines, most of which will be distributed world wide.