Unavailability of deep port harbours in India is hampering export of trucks and it is the “biggest constraint” while planning to ship more vehicles from the country, says German auto major Daimler.
The company, which is present in India through a wholly-owned arm Daimler India Commercial Vehicles, manufactures trucks and buses out of its Oragadam plant near Chennai. It is targeting to touch 30 exports markets by the end of this year.
“I’ll be happy if we could have a deep port harbour. I can export my trucks easily because this, for us, is the biggest constraint to raise export numbers. Access to shipping lines, access to deep water harbours this would help us,” Daimler India Commercial Vehicles (DICV) Managing Director and CEO Erich Nesselhauf told PTI.
So, if the government really has the intention to help raise exports, deep water port facilities are needed, he added.
Asking the government to address the matter urgently, Nesselhauf said: “I am not interested in 2025, I am interested in it right now.”
DICV currently exports DICV-built FUSO trucks from Oragadam plant to markets to over 20 markets in South East Asia, Africa, and Latin America.
Since starting operations in India four years ago, the company has so far sold 42,000 units in the country and exported another 7,000 trucks.
The company is now also gearing up to export fully built buses. It plans to start exporting 9-tonne Mercedes-Benz school buses to the Middle East by the end of this year.
The company has already invested Rs 4,400 crore for truck manufacturing and an additional Rs 425 crore for the over 400-acre bus plant near Chennai.
When asked when the company expects to break even in the country, Nesselhauf said: “Our clear target is next year but it also depends upon the Indian economy…it is extremely challenging for us not knowing the date and rate of GST and so on…we will do everything to achieve it but there are so many uncertainties in the market.”
He listed uncertainties in GST implementation by April 2017, BS4 emission norms implementations across the country, scrappage rate and if overloading be banned or not as some of the major challenges for the company.
“No problems with new tax regime, we would have liked it to come earlier..but uncertainty of not giving a deadline, this is a difficult thing for everybody,” Nesselhauf said.
Despite all these challenges, the company will ramp up its service network especially in smaller towns going ahead, he added.
On new product launches, he said the company would enter sub-9 tonnes truck segment next year.
“We will establish one additional product brand below our already existing 9 tonne portfolio…We will produce for India and also for exports, especially to Middle East. It will be between 6.5 tonnes and 8.5 tonnes. It will not only boost our volumes but also shows or commitment to India.” Nesselhauf said.
When asked if the company would like to enter lower tonnage segments like last mile category dominated by Tata Ace, Nesselhauf said: “This is not our segment. Our segment starts from 6.5 tonnes. India might be a huge market for such products but our strength is big trucks. We are in the (big) truck business and we will focus on 6.5 tonnes to 49 tonnes segment or even more, it is our core business.”
On new emission norms, he said the company has the technology and can easily move to Euro 6 in India but expressed apprehension that the added cost would be a “huge burden on fleet owners”.
“Euro 6 will be extremely costly for all..for Euro 6 we will have to import a lot of components from the foreign countries..personally I would have favoured not skipping Euro 5. It would have been better, but if the government wants Euro 6 we are ready to do so but it will be a big burden on Indian fleet owners,” Nesselhauf said.