On Monday, June 4th, Hero MotorCorp declared it will invest 25.75 billion rupees ($464 million) to build two plants in India.
The investment is aimed at helping the company build two new factories, but also expand development and research capabilities. Hero MotorCorp is known as India’s largest maker of two-wheeled vehicles and this investment plan will keep the company in its leadership position in the competition against Honda Motor and Yamaha Motor. Hero said that the first plant will be located in Neemrana, in the northwestern state of Rajasthan, and the second one in Gujarat.
Hero’s managing director and chief executive, Pawan Munjal, declared that 4 billion rupees will be invested in the Neemrana plant, which is expected to produce 750,000 vehicles annually. About 11 billion rupees will then be invested in the Gujarat facility, expected to produce 1.2 million vehicles annually, rising to 1.8 million in the second phase. Both facilities are to be opened in July-September 2013, and then 4 billion rupees will be invested for a research and development center near Jaipur, the capital of Rajasthan.
“My expectation from the two-wheeler industry is very bullish,” Mr. Munjal said. “We have years and years of growth available to us.”