Hero Honda Motors, the world’s largest two-wheeler motorcycle company, is going global with its auto business. The company has aggressive plans for the automotive components space. According to the company, the gears manufactured at the new Rs 30 crore plant will be heading into BRP Rotax products globally. With this 1,20,000 capacity plant, Hero Motors is looking to play a bigger game in the global auto business. Soon gearboxes made by Hero will also be in bikes made in the USA. Hero wants to position itself as a specialist supplier to not just Rotax but other auto giants in the two-four wheeler space. The company is in talks with the likes of BMW, Suzuki and Yamaha. “The new plant can double its capacity virtually overnight if the need arises. It can also increase production four fold if fresh contracts come in,” said Pankaj Munjal, MD, Hero Motors Ltd. Hero is also in talks to clinch Rs 300 crore deal with General Motors in Europe, or more specifically Opel for engine parts and gears. Hero wants to step into the space of being a drivetrain supplier and is also open to a partnership to develop its own range of four wheelers, powered by efficient small spec engines like what Nissan is planning with Bajaj. Hero is gearing up for Rs 500 crore minimum investment in this business over the next three years.
source: NDTV Profit