Avtec Ltd eyes 233 pc rise in exports; sets up unit in Chennai

New Delhi, Nov 8 (UNI) Eyeing a growth of 233 per cent in exports of engines and transmissions for automobiles to the United States and Europe, Avtec, a part of GP-CK Birla Group, has set up an export oriented production facility in Chennai.

The company currently exports to the United States and has plans to extend it to the United Kingdom and Turkey. With this, the company expects the exports revenues to go up from present Rs 15 crore to Rs 50 crore by next fiscal.

''Avtec has earmarked an investment of Rs 30 crore in the Chennai plant, which has the overall capacity of producing 500 to 600 transmissions,'' company CEO Sudhir Rao told reporters here today.

Most of the planned investment will go towards expanding the machining capacity of the plant, he added.

In response to a question on export orders that the company has got from the export prospects, Mr Rao said, ''Four export projects are close to finalisation and we will make announcements in this regard soon.'' One of these orders will be sourced from the Chennai unit while the work on the other three will be done in its facility at Pithampur, Indore, he pointed out.

Expecting an increase in demand for the company's products, Avtec has also planned capacity expansion of plants in Hosur, Tamil Nadu, and Pithampur. ''We will invest Rs 15 crore in the Indore plant and Rs 3-4 crore in our facility at Hosur,'' Mr Rao said.

With the expansion in the plants, the company expects a total sales trunover of Rs 650 crore by financial year 2007-08. Last year, it had made sales of Rs 497 crore.

The company today also extended its 25-year-old business partnership with US-based Allison Transmission of General Motors Corporation by five years.

''Over the years we have enjoyed a very good relationship with Allison Transmission and we are confident that it will further result in additional business opportunities for both companies,'' Mr Rao said after signing the Memorandum of Understanding.

Speaking on the MoU, Allison President Lawrence E Dewey said, ''India is a very important market for Allison Transmission. We intend to build on our 25-year relationship with Avtec and GP-CK Birla Group to further enhance our presence in India and to play an active role in the new era of Indian commercial vehicle market.'' Under the partnership, Avtec holds exclusive license for the assembling and distribution of Allison products.

Avtec manufactures engines and transmissions for supply to General Motors, Ford, Hindustan Motors, Mahindra&Mahindra in India. The Pithampur unit also supplies components to Mahindra&Mahindra and Eicher.

The company supplies transmissions to Ashok Leyland, Caterpillar, Godrej, Tata Motors and Voltas from the Hosur plant.

Hindustan Motors owns 49 per cent stake in the company while 21 per cent is held by the GP-CK Birla Group. Remaining 30 per cent equity participation is from private equity player Actis.

Allison Transmission manufactures automatic transmissions for trucks, buses, off-road and military vehicles to companies in more than 80 countries.

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