Indo- Lanka auto majors begin SUV KUV100 production locally
Sri Lanka began its first ever assembly manufacturing compact sports utility vehicle (SUV) KUV100 in partnership with giant India unleashing the potential of adding local value in the production process.
Prime Minister Ranil Wickremesinghe looks at engine parts at the factory.
India’s global diversified conglomerate Mahindra and Mahindra partnered with Sri Lanka’s Ideal Motors to open a vehicle assembly manufacturing plant in Welipenna, Mathugama on Saturday.
Prime Minister Ranil Wickremesinghe and High Commissioner of India Taranjit Singh Sandhu shook hands minutes before launching the assembly manufacturing process of (SUV) KUV100 at a glittering ceremony.
The new Rs.3 billion vehicle plant will have an installed annual capacity of up to 5,000 units and will provide direct and indirect employment to about 200 people over the next two years.
The Ideal Motors’ car will be an indigenous one with up to at least 35 per cent of local value addition. The parts will be manufactured in-house or in a Vendors’ Park located near the main factory.
The first vehicle was rolled out last Saturday. The local assembly operation makes use of four components such as tyres, batteries, exhausts and seating systems.
While tyres will be supplied by CEAT tyres, the automotive batteries will come from the battery maker Exide, both Indian companies with footprints in Sri Lanka.
“Sri Lanka implements a free trade agreement with India but the country is not exporting automotive components to India, so there is a chance for her to actually accomplish that,” Nalin Welgama, Chairman of Ideal Motors, said.
He added that the recently inked JV will initially manufacture 100 small cars per year and then produce Light Commercial Vehicles to serve the rural market, where these vehicles are in heavy demand.
Adhering to government policy for electric vehicles in Sri Lanka, Mahendra has already planned two such vehicles for the local market, Dr. Pavan Goenka, Managing Director, Mahindra & Mahindra Ltd. said.
The Sri Lanka passenger car market’s size is in the range of 32,000-35,000 units per annum, of which new car sales account for only 25 per cent.
Prime Minister Wickremesinghe in his address mentioned the substantial opportunities that exist for industrial collaboration between Indian and Sri Lankan companies given the complementarities.
Indian High Commissioner Taranjit Singh Sandhu said, that the plant symbolises the promotion of ‘Make in Sri Lanka’ alongside ‘Make in India.’
He pointed out that it also demonstrated the commitment of Indian companies to stand with Sri Lanka during difficult times.