Cummins to infuse $300 m for setting up four facilities

Written by fe Bureaus | New Delhi | Updated: Jun 30 2010, 04:43am hrs
Global auto component maker Cummins has earmarked an investment of $300 million to set up four facilities in India, including a mega manufacturing unit to support future capacity requirements for its auto components and power generation businesses in the country over the next five years.

For this purpose, the company has acquired 300 acre in Maharashtra. These facilities would include an engine plant meant for high horsepower vehicles with 9-15 litre engine capacity, a re-conditioning unit, a parts supply distribution centre and a power generation facility for generators.

The mega site will have multiple facilities and is going to be low-cost solution to support future growth. All our businesses are witnessing robust and buoyant demand, Anant Talaulicar, president of its components business & managing director of India, said. He said Cummins aims to become a $2-billion company from the current $1.2 billion. We expect total sales to grow 30%, he said.

Cummins Indias automotive business comprises close to 50% of the company's overall revenues, its power generation business contributing about 30%. Exports constitute 20% of the companys total output, Talaulicar added.

He said the company's engine manufacturing facility with its joint venture partner Tata will start with an initial capacity of 60,000 units by the end of this financial year. The output will be raised to 90,000 engines per year, starting first quarter of 2011, he said. Of the total $300-million investment, $90 million has been earmarked for the JV company.

Apart from setting up the engine facility, Cummins will also set up a rebuilding centre for generators, reconditioning facility and a parts distribution unit within the complex.

Cummins India, owned 51% by USs Cummins Inc, has 15 manufacturing facilities in the country, mainly centred around Pune. It supplies components to some of the leading heavy commercial vehicle manufacturers like Ashok Leyland, Tata Motors and Volvo-Eicher Commercial Vehicles.