Ashok Leyland sets up vehicle assembly unit in UAE

Mumbai, Oct 5 (UNI) Ashok Leyland, the Hinduja Group flagship in India, today signed a Memorandu of Understanding (MoU) with the Ras Al Khaimah Investment Authority (RAKIA) for setting up bus assembly unit in the first phase that will be eventually upgraded to a vehicle assembly plant (for trucks and buses) in the second phase.

The agreement was signed today by Ashok Leyland Managing Director R Seshasayee and Dr Khater Massaad, CEO of Rakia, a public body established by the Government of Ras Al Khaimah, an Ashok Leyland release said here today.

The unit, with an initial annual capacity for 1,000 buses of international styling, manufacture and quality, will start operations as a bus body assembly using Ashok Leyland chassis and bus body CKD kits sent from India (including Irizar TVS).

The facility, to be built with an initial investment of USD 5 million, will include a state-of-the-art paint plant for bus bodies.

The unit will be managed and operated by Ashok Leyland. To start with, it will have a 450-strong workforce and will commence operation in an year's time from now.

The unit will be provided an industrial license that will enable duty free import of vehicle kits and duty free export of finished vehicles to GCC and the Middle East, the release said.

Ashok Leyland enjoys a market share over 60 per cent in Dubai's standard bus market, with exports to the region set to cross 1,500 vehicles per annum.

''The proposed unit will allow local value addition, close to a growing market for Ashok Leyland. Customers stand to benefit through better finish and timely delivery as we can avoid shipping of finished products. The vehicle assembly facility in UAE is in line with our practice of favouring local value addition to our major export markets,'' said Mr Seshasayee.

''As a strategic window to Gulf Cooperation Council (GCC) and neighbouring countries, we plan to scale up operations of the unit in phases and envisage its development into a full-fledged assembly unit for complete trucks and buses,'' he added.

UNI KU SSS AW2215