Mahindra & Mahindra, manufacturer of utility vehicles, farm tractors and light commercial vehicles, has entered into a joint venture with US-based International Truck & Engine Corporation to manufacture light, medium and heavy commercial vehicles in India and other developing markets.
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Both companies will form a venture in which Mahindra will hold a 51% stake while ITEC will have the remaining 49%.
The total cost of the project is pegged at INR4.0 billion (€72 million). Production is likely to commence in 2007.
Mahindra plans to have a high level of local content in the trucks and the proposed vehicles would have 90% from the beginning. Manufacturing will be done at one of the existing M&M plants due to better proximity of suppliers.
Mahindra & Mahindra will be the fifth major manufacturer of commercial vehicles in a market dominated by Tata Motors and Ashok Leyland. The other players are Eicher Motors and Bajaj Tempo (in collaboration with MAN).
Deepesh Rathore / Tilak Swarup
