Wheels on a roll

Alwar (Rajasthan), Oct. 2: Commercial vehicle major Ashok Leyland will make 5,000 buses this fiscal at its Alwar and Pantnagar facilities. The vehicles will be delivered to different state transport bodies.

The company, along with Tata Motors, had bagged a major share of the Rs 5,000-crore contract under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) scheme.

“A unit for building buses has been set up at our Alwar plant at an investment of around Rs 65 crore. Apart from catering to the Delhi Transport Corporation (DTC), we will manufacture 200 low-entry buses for state transport undertakings of Rajasthan, Maharashtra and Andhra Pradesh under the JNNURM scheme,” said Rajive Saharia, executive director (marketing) of Ashok Leyland.

Ashok Leyland has so far delivered around 350 buses under the JNNURM plan. The Pantnagar plant will go on stream in a few months. The capacity of the Alwar facility will be ramped up from 200 low-entry buses a day to 300.

Price hike

Ashok Leyland is planning to increase the prices of its commercial vehicles by April 2010 to offset the rise in input costs.

“Steel prices are moving up. We are also facing higher costs because of technology upgradation associated with new emission requirements. The cost has to be passed on to consumers,” said Saharia.

Fixed price deals with local transport bodies for delivery of vehicles is another reason for the price hike.

On the quantum of the price increase, Saharia said, “It will vary, depending on the vehicles and models. However, it is likely to be across all models.”

Saharia said the price hike would happen only after this fiscal when new emission norms come into play.

All vehicles in 11 major cities will need to comply with Bharat Stage-IV emission norms, while other cities will move from Bharat Stage-II to Bharat Stage-III.

Ashok Leyland will soon deliver 50 buses to DTC as part of its Rs 1,190-crore contract to supply 875 units this fiscal.

Apart from a Rs 480-crore contract for the supply of new buses, the two parties had signed a Rs 710-crore deal for the maintenance of the vehicles over a period of 12 years.

Major commercial vehicle makers will deliver 2,200 buses to DTC this fiscal, of which Ashok Leyland’s share is 875 buses.

It will sell both air-conditioned and non-air conditioned buses in the price range of Rs 49.9 lakh to Rs 59.3 lakh.