Hindustan Motors is currently on a hunt for an SUV maker to make use of the excess capacity at its Chennai plant. HM had recently announced that the plant, located at Tiruavllur, will be demerged and be transferred to its fully owned subsidy Hindustan Motor Finance Corporation limited. The step has been approved by the HM board and when it is completed, will allow HM to ‘rent’ out its excess capacity.
The Tiruvallur plant is currently used to assemble the Mitsubishi Pajero Sport and the Mitsubishi Outlander but since Mitsubishi has no equity participation, the plant is owned entirely by HM. Now reports suggest that Mitsubishi may facilitate a deal with Isuzu to assemble their range of utility vehicles at the Chennai plant till they setup a facility in the country. Mitsubishi has a 9.2 per cent stake in Isuzu and since it is not doing too well, the deal would make a lot of sense.
Isuzu silently began operation in the Indian SUV market by opening a showroom in Coimbatore last month. It will also soon open a showroom in Hyderabad and is currently bringing its vehicles, the D-Max pickup truck and MU-7 SUV via the CBU route. The company has been scouting for location to setup a plant and has most likely zeroed on a piece of land at the Sri City industrial township near Chittor District of Andhra Pradesh.
Source: ET and Hindu Businessline
