The largest two wheeler company in India, the Hero MotoCorp is keeping things under its control. With the competition running cut-throat, they know they need to pick things up faster. One of the important steps to remain in the competition is the superior production. To cope up with the production pressure, Hero is going to make another big investment.
The company announced that it will be investing Rs. 2575 crores for the purpose of capacity expansion as well as for setting up a complete R & D facility center. Out of this total amount, Rs. 400 crores would be spent on the R & D facility center at Kukas, Rajasthan.
The bulk of the amount – Rs. 2000 crores would be spent on mainly the company’s fourth and fifth plants at Rajasthan and Gujarat respectively. Apart from this, there would be capacity expansions in Gurgaon, Haridwar and Dharuhera plants. The remaining amount of Rs. 175 crores would be for the other investment.
The plant at Rajasthan will be built with an investment of around Rs. 400 crores. The new plant will have an installed yearly capacity of 0.75 million units. It is expected that the plant will be fully operational by the financial year. The Gujarat plant will however, be far bigger than the Rajasthan plant on both the investment and production terms.
The Gujarat plant will consume a whopping Rs. 1100 crores as against only Rs. 400 crores for the Rajasthan plant. This plant will have 1.2 million units as installed capacity. The plant at Gujarat will be at the company’s service around three to four months after the Rajasthan plant.
The existing capacity expansion that has come at a cost of Rs. 500 crores will help in providing the company with 7 million units for the three plants. As and when the remaining two plants are ready, the overall installed capacity will rise to 9 million units.
As far as the latest R & D facility center at Kukas is concerned, it will eat up around 250 acres and will be equipped with a test track as well. As many as 500 people will be employed at this facility center.
The company has set for itself an ambitious figure of manufacturing 10 million units by the year 2016. An additional milestone for the company will be launching their motorcycle on its home-grown technology in a couple of year’s time.