Volvo Buses to start exports by 2009

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Mumbai, Jun 3: With 16,000 plus Volvo buses already running on Indian roads, Volvo Buses India Pvt Ltd, the new face of Volvo Bus Body Technologies India Pvt Ltd (a JV between Volvo Bus Corporation and Jaico Automobiles), is planning to establish itself as a full transport solutions provider. It also plans to export buses from India by 2009.

"We want to be known as a full bus solutions provider and not just as a bus selling company. In terms of profiling, Volvo Bus Body Technologies India was not correct," said Akash Passey, MD, Volvo Buses India.

All the other particulars of the JV remain the same. Volvo holds 70% in the JV and the remaining 30% is with Jaico. An initial investment of Rs 80 crore has been made into the new JV facility set up at Hoskote in Bangalore. The plant will have a capacity of 1,000 units per year by 2010. "We are producing 40 buses per month," Passey said. "Once the plant is established, we plan to develop this as an industrial hub for exports of Volvo buses. On the cards are markets including the Middle East and South Africa."

In the domestic market, the company plans to sell 440 buses this year, as against 200 last year. "We see a shift in its product mix from the 80:20 ratio between the inter-city and city buses to 50:50, citing the pressing need for quality public transport," he said. The company has 15 to 20 dealerships in all major cities for buses. "We have a common dealership network set up for trucks and buses under Volvo India," Passey said. On Tuesday, Volvo India added a new private dealership in Mumbai at Vasai. It will look into bus servicing with 18 bays, Passey added.

Volvo Buses India has hiked prices of its buses up to 5% in a bid to offset rising raw material cost, unfavourable exchange rates, and surging inflation. It sources components from Europe. In the mid-term, Passey said that the company sees competition coming from local players who are upgrading their technology, building capacity, and have a strong base.