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Home arrow Business News arrow Ashok Leyland in JV with Nissan to develop and market LCVs
Ashok Leyland in JV with Nissan to develop and market LCVs Print E-mail
Written by Arjun   
Friday, 31 August 2007
 MUMBAI: Nissan and Ashok Leyland have agreed to form 3 JV's for vehicle manufacture, powertrain manufacture and technology development. According to sources, Ashok Leyland and Nissan motor will invest about Rs  1500 crore and is likely to set up a joint manufacturing facility.  The two firms signed a heads of agreement (HoA) to float three joint venture companies - two of them will manufacture outfits to make LCVs and powertrain and the third one will be a technology company that would develop LCV-related products.

 Vehicle manufacturing company with exclusive rights to manufacture LCV products in India for both the partners. Manufacturing facilities will be located in India, and the company will be majority owned by Ashok Leyland. In the medium term, production volume (for Indian and export markets) is expected to be above 1,00,000 units annually.

 Powertrain manufacturing company, for the manufacture and assembly of engines and other drivetrain components to be fitted in the LCV products and for exports. Manufacturing will be located in India, and the company will be majority owned by Nissan Motor Company.

 Technology development company, for the development of LCV products and related powertrains. The company will be owned 50:50 by the two partners.

 In addition, the Ashok Leyland and Nissan Motor will look at the possibilities of sharing their respective sales networks. In India Nissan Motor will have access to Ashok Leyland's dealer network. In the overseas markets, Ashok Leyland may have access to Nissan Motor's distribution set-up.

 The two companies will now conduct a detailed feasibility study covering all proposed areas of cooperation, leading to the signing of a memorandum of understanding and the subsequent formation of the legal partnership. This study is expected to conclude by October 2007.
 
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