FORD PLANS HIGHER VOLUME OF ITS INDIA-ENGINEERED "FIGO". SIGNS $500-MILLION DEAL WITH TAMIL NADU

CHENNAI, September 25, 2009 - The Ford Motor Company today signed an agreement with the Tamil Nadu government for a $500-million expansion program at its manufacturing facility at Maraimalai Nagar a city suburb.

This would help the company expand its presence in India, paving the way for volume production of the new Ford Figo which was unveiled yesterday in New Delhi, according to Ford India.

The agreement was signed by Ford India President and Managing Director Michael Boneham and the state government's Principal Secretary (Industries) M F Farooqui, in the presence of state Chief Minister M Karunanidhi and Deputy Chief Minister M K Stalin.

"This agreement symbolises our belief in the strong role India can play in the future of Ford Motor Company," said Boneham.

"After the introduction of the India-engineered and Chennai-manufactured all-new Ford Figo, our expanded investment in Tamil Nadu will benefit the region in the form of expanded employment -- both at the plant and among a growing local supply base," he added.

Ford, which established manufacturing facilities in the state in 1996, has already executed the first phase of transformation at its Maraimalai Nagar plant as a part of the $500-million expansion programme. It is now being readied for volume production of the new Ford Figo.

The final phase of the plant expansion will add a new engine production facility, with a capacity of 250,000.

This will convert the Maraimalai Nagar plant into a regional source for small displacement engines, with production catering to demand from both -- Indian as well as Ford's Asia-Pacific and Africa markets. Construction of the engine plant is well underway, with production expected to come on stream in 2010, said Boneham.

The plant's annual vehicle production capacity will be doubled to 200,000 units after the expansion, which is also expected to create 1,000 new jobs. The manufacturing facility will have 92 new robots and India's first application of a new eco-friendly painting process, called Three-Wet High-Solids.

The Ford investment in Chennai's regional development envisions a high degree of localization and a broader India supply base -- boosted by the plant's new export status and higher vehicle

VOLVO PLANS TO LAUNCH DOUBLE DECKER BUSES IN INDIA IN NEXT 3 TO 5 YEARS. IT HAD 50% JUMP IN SALES OVER LAST YEAR

KOLKATA, September 24, 2009 - Volvo is planning to launch its double decker and vestibule buses in the country in the next three to five years, Volvo Buses India MD Akash Passey said here today.

"We are planning to introduce our entire range of models we have in our parent company kitty in the next three to five years," he added.

The company currently offers two models of luxury coaches and city-type buses from its Bangalore facility.

"We are also introducing sleeper coaches in Gujarat and Karnataka from next month where demand for such transport is very high," Passey said.

The company registered a jump of 50 per cent in its sales over the last year owing to bulk orders by different state transport corporations under the JNNURM project.

In 2008, Volvo sold 400 buses of which 250 were city-type and the rest coaches, while this year the company has sold 600 buses most of which are city type.

"We plan to hold on to the 600 sales figure, though there will be no JNNURM in 2010," Passey added.

He claimed that the company was making rapid progress in the city bus segment with 12 cities in the country now running Volvo buses, which are four-times expensive. But given the operational benefits and longer life, operators are shifting to it.

NISSAN MOTORS TO INVEST 350 BILLION YEN ($3.90 BILLION) TO PRODUCE THE "MICRA" AND OTHER CARS IN CHENNAI

BIZ INDIA Editor's Note: We've used the exchange rate of $1 = 89.635 Yen, based on Bloomberg.
currency exchange calculator.
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MUMBAI, September 25, 2009 - Japan’s Nissan Motor plans to make India one of its key manufacturing locations for its compact cars, which include products such as Micra, a senior official said.

“Low operational costs and the growing importance of India in compact car manufacturing makes it an attractive proposition to make India a hub,” said K Tokuyama, MD & CEO, Nissan Motor India.

When Nissan, which has a partnership with France’s Renault, does it, it would be following the footsteps of Suzuki Motor, its rival in home country, and South Korea’s Hyundai Motor, which have benefitted from the massive plants they have set up here. The low-cost, but trained manpower, thousands of component makers and easy access to growing markets make India an attractive destination for small cars. Tata Motors is producing the world’s cheapest car here.

Nissan has said it will invest close to 350 billion yen this year across the globe and India may get a “major chunk” of the investments, Mr Tokuyama said. India will be an export hub for compact cars for many countries, especially for Europe from the second half of 2010. Nissan which is scheduled to showcase its enhanced Micra in March of 2010 at the Geneva Motor show, plans to launch the same in India in May 2010. It will be followed up with five more models in three years, including an entry-level car, commercial vehicles to high-end sports cars and sedans, an official said.

Nissan may also set up massive plants in Russia and Brazil to cash in on the prosperity in those resource-rich nations as part of its five low-cost plants across the globe, a person familiar with the plans said. “We still have not taken a decision on the other two countries,” said Mr Tokuyama.

Nissan has also been juggling with its production sites across the world. Recently, it announced plans to shift the production of Micra compact car from UK to India and from Japan to Thailand. India and Thailand will be the markets from where it will source Micra from 2010.

The company is building a plant in Chennai, Tamil Nadu, with an investment of Rs 4,500 crore that will have a capacity to produce four lakh cars. That plant is an equal joint venture between Nissan and Renault. Mahindra & Mahindra, which are partners in producing Renault’s Logan in India, pulled out of the tripartite agreement for that venture in 2007.

Nissan India which already imports the X-Trail SUV and the Teana sedan as CBUs (completely built unit), plans to sell the 370Z early next year. The company is also contemplating the launch of GTR, a sportscar or the Murano, a crossover, in India.

“We have yet to decide whether we need a volume puller or a image leader. Depending on the decision, the fourth model will be imported for the Indian market, Mr Tokuyama said. The Japanese company is also toying to sell its electric vehicles in India.