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Hindustan Motors in talks with foreign carmakers for components outsourcing



8 August, 2005: Hindustan Motors is in talks with many foreign firms to supply components, its executive vice president Ashwani Dubey informed media persons on Wednesday.

The foreign carmakers with whom Hindustan Motors is in talks include Germanyís Volkswagen.

Hindustan Motors is trying to rake in Rs 300 crore from components outsourcing business in the next three years, Dubery informed.

The carmaker is also in talks with other firms like Mitsubishi and Peugot, Dubey told reporters in New Delhi.
Hindustan Motors is a CK BIrla group company. It manufactures components in Uttarpara in the eastern Indian state of West Bengal.

Last financial year the quantum of business components was about Rs 200 crore. Of this, components worth Rs150 crore to 170 crore went for internal consumption and the actual outsourcing was around Rs 25 crore, Dubey acknowledged.
Hindustan Motors expects the outsourcing business to touch about Rs 65 crore this fiscal. The firm eyes to double it next year, he said. Thus the company says component outsourcing from its unit in Uttarpara could cross Rs 300 crore in the next three years.

In a bid drive sales in the booming Indian market, Hindustan Motors, in partnership with, Japanís Mitsubishi Motors, also plans to launch a slew of models in the coming months.

These would be completely built units for the time being, the company announced recently.

Mitsubishiís Lancer Cedia, Montero, Outlander and mini van Grandis will be launched in India as per plans.The plan is to also focus on driving Pajero sales apart from these launches. The firms would gauge the market response before making future plan, which could include assembling the cars in India.Mitsubishi is Japanís only automaker running in a loss. It announced plans to widen its alliance with Hindustan Motors in May. Mitsubishi is also looking at sourcing components from India.

Hindustan Motors manufactures Ambassador, which is still a popular car in India. The Ambassador design is based on the 1948Morris Oxford. It is one of the original three car manufacturers in India. Founded in 1942, Hindustan Motors was a leader in car sales until the 1980s. After the industry was opened up, it slipped from its numero uno position.

Apart from Uttarpara, it has plants in Pithampur in Madhya Pradesh, Hosur, Thiruvallur near Chennai and Hosur near Bangaore , but in Tamil Nadu.



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