Iveco keen to work with partners in Indian CV market | The Financial Express

Iveco keen to work with partners in Indian CV market

Iveco would be participating in the India on-road, off-road CV market segment through its powertrain company, FPT Industrial

Iveco keen to work with partners in Indian CV market
Marx said LNG was not a transition fuel but it was a fuel here to stay as it was the better option for long haul heavy-duty truck applications. (IE)

Truck maker Iveco Group will be tapping opportunities in the Indian commercial vehicles market through partnerships and they see a window of opportunity opening with the growing interest in the alternate fuel segment in the country’s CV market.

Gerrit Marx, Global CEO, Iveco Group, said they had no plans at this stage to bring Iveco trucks to India. This is a very competitive market and it was growing yet the window of opportunity for them would only open with new energy, new propulsion, electric and hydrogen, Marx said. They could consider entering the truck market in India at the right point of time with partners, he said.

The tie-up with Blue Energy Motors for supplying Liquified Natural Gas (LNG) engines was a step in that direction, Marx said. Blue Energy Motors launched India’s first fuelled green truck and handed over the first set of LNG trucks to two cement companies (JK Cement and Dalmia Cement) on Monday.

For now, Iveco was content with supplying engines and powertrain to the Indian partners, who were deeply localised and were better positioned to tap the emerging market opportunity. They were also pursuing other businesses in India in the agriculture and construction segment. Iveco was awaiting for new emission standards to kick in India for these segments, especially off-road applications. Marx said that the new emission standards would drive demand for new modern engines and be an opportunity for them.

Marx said they were carefully observing the market in India and going by the Daimler’s Benz truck experience in the country, they do not want to go down that road. They would rather work with partners in India and be jointly successful with them, he said. Since 2019, they had been building Iveco around partnerships, innovation, and a good network of strong partners as they were mindful of not being the largest truck OEM but being the most entrepreneurial, he said. Iveco was looking at outsmarting and outpacing much larger competitors, whom they could not outspend, Marx said.

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Iveco would be participating in the India on-road, off-road CV market segment through its powertrain company, FPT Industrial. They will be shipping completely built engines from Italy to India. FPT has been supplying tractor engines to several companies in India, including CNH Industrial. They were in the process of renewing this licensing agreement with CNH and also launching new energy platforms in India. These would be methane-capable engines, biomethane-powered lower HP tractors, and also be exploring hythane engines (blend of hydrogen and methane).

The shift to LNG takes a few years and it takes time as truck companies want to see that it works and try it out for 15-18 months and once they are convinced they immediately scale up, he said. Marx said LNG was not a transition fuel but it was a fuel here to stay as it was the better option for long haul heavy-duty truck applications.

Anirudh Bhuwalka, CEO, Blue Energy Motors, expects the growth trajectory for LNG trucks in India to be similar to China and reach double-digit market share in a quick time. The LNG truck market in China grew from 15,000 units in the first year in 2016 to 75,000 units in the second year and has reached 1,40,000 units a year at present, which was 14% of the total truck market and is expected to go up to 25% soon.

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Bhuwalka said the operating economics in India would lead to a faster shift to LNG trucks in India. LNG infrastructure was being built with all oil marketing companies rolling out LNG stations. IOC had a mandate of rolling 600 LNG stations out of which 25 would be ready in the next six to 12 months and there were private companies such as Ultra Gas and BLNG starting to put up stations so the country would have 50 LNG stations in 2023, Bhuwalka said.

Regarding investing in Blue Energy Motors, Marx said they were investigating multiple ways to scale this business and were looking at doing something similar to what they did with their investment in US startup, Nikola Motors. They had collaborated with Nikola to offer a bundle of offerings from truck to fueling to leasing, insurance, and launching a pay-per-use model with Nikola.

Iveco introduced the LNG long haul heavy-duty trucks in Europe and it had grown from 1% of the truck market in 2017 to 4% of the total truck market in 2021. For this, the company along with partners invested in setting up LNG stations at strategic locations and built a refueling network in Europe. The company offered trucks, fuelling stations, financing, leasing options, and pay per use model, that enabled the shift to LNG trucks, Marx said.

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