Ashok Leyland betting big on Telangana

Gearing up for BS IV compliance with improved technology vehicles.

By   |   Published: 19th May 2017   9:22 pm Updated: 20th May 2017   6:00 pm
Ashok Leyland
THINKING AHEAD: Ashok Leyland Global Trucks President Anuj Kathuria at the launch of the new technology in Hyderabad.

Hyderabad: Hinduja Group flagship company Ashok Leyland is seeing consistent sales growth in Telangana across its product variants. Last fiscal, the company sold 5,516 vehicles in Telangana and previous year 4,800 vehicles. Of all the products, tippers segment had been the major business driver in this market. To woo buyers, the company has showcased its wide ranging products in Hyderabad on Friday.

Last October, Ashok Leyland entered into an agreement with Telangana government with plans to set up a body building unit with an investment of Rs 500 crore that could create employment to over thousand people.

The company occupies 87 per cent market share in the buses market in Telangana and Andhra Pradesh and 45 per cent in trucks in these two markets.

Ashok Leyland Global Trucks president Anuj Kathuria told Telangana Today, “We have achieved sales of 12,000 vehicles last year in Telangana and Andhra Pradesh of the total 1,00,000 vehicles sold in the domestic market accounting for 12 per cent.”

Nationally, the overall medium and heavy commercial vehicle trucks market witnessed de-growth of 2 per cent in 2016-17. Around 3,50,000 vehicles had been sold last year in this segment in the country. Tipper trucks that cater to construction and mining saw healthy growth at a rate of 25 per cent.

Sharing the segment outlook, Kathuria said, since a lot of pre-buying took place during January and March quarter because of the BS IV decision, there could be reduced demand in the April to June quarter of the current fiscal. With GST implementation scheduled for roll out from July 1, market could face certain uncertainties in terms of demand. Also, a lot will depend on how the monsoon will be. Overall, the first half of the fiscal (April-September) could see dip in demand for logistics vehicles.

Ashok Leyland which has about 10,000 BS III vehicles plans to export some to nations that do not have restriction and will convert some to meet BS IV compliance norms.

Vehicles used for construction and mining could still continue to see good demand as several infrastructure projects are in pipeline. Tractor trailers could also see stable demand as several LPG contracts are being executed under the Central government schemes.


Technology


The second largest commercial vehicle manufacturer has introduced its indigenously developed Intelligent Exhaust Gas Recirculation (iEGR) technology across its product range of over 130 Horse Power (HP). The technology meets the expectations of BS IV norms and is claimed to be better than Selective Catalytic Reduction (SCR) technology but will also be cost effective and easy to operate.  “We are getting ready to comply with the Indian government’s plan to introduce BS VI norms by 2020,” he said.

Talking of regulatory compliance, he said, though the country hasn’t yet introduced the Bus Code yet, the company has voluntarily been maintaining European standards that have set benchmarks for higher safety including the ‘front crush’ and anti-bacterial seat features in school buses keeping in mind the health of children.


Market Presence


Ashok Leyland today has a market share of 33 per cent in buses and trucks (combined) market, nationally. The company saw a growth of 7 per cent in its business while the industry witnessed de-growth of 2 per cent in the same period. It leads the buses market in India and second in trucks. Globally it occupies fourth position in buses segment and 12th in trucks.

The company has created 1,000 touch-points and 5,000 spare-part outlets across the country. It has about 50 workshop on wheels and plans to take this number to 200 in near future.


Overseas Markets


Kathuria said, “We have sold 10,000 vehicles last year, accounting for about 10 per cent of the total sales we achieved. We have sold our vehicles in Bangladesh, Sri Lanka, Nepal, GCC countries such as Saudi Arabia, Qatar, Oman and African nations such as Kenya and Nigeria and CIS countries like Russia and Ukraine.”

The company which has 400 truck variants today will continue to focus on these overseas markets. “We are planning to take the export contribution to one-third of overall business in the next five years,” he informed.

It has set up a satellite plant in Bangladesh for chassis after setting up one dealer unit in UAE. New plants could come up in Kenya and Ivory Coast (West Africa). In future the company plans to set up units on its own and through joint venture partners, abroad.