Ashok Leyland: Focus on innovation

India's leading commercial vehicles manufacturer Ashok Leyland has identified Dubai as a central location for its international operations headquarters. The Chennai-headquartered company, which has had a significant market presence in the UAE for over 35 years, is focusing on Dubai in a big way to cater to its growing markets in the Middle East, Africa, Russia and the CIS.
"Historically, we have been a domestic player in India, but we now have growth ambitions across the world," Vinod K. Dasari, CEO and Managing Director, Ashok Leyland, told this correspondent.
Dasari said the company has a three-stage strategy to expand globally. The first is to ensure that for every two vehicles sold in India, it must sell one abroad. The second aspect of the strategy is to shift the export hub to Dubai from Chennai, and the third is to not just depend on exports, but to develop plants abroad and boost local economies.
The company established a manufacturing unit in Ras Al Khaimah in 2007, becoming the first bus and truck manufacturer in the UAE. Today, the plant has an installed capacity of more than 5,000 units per annum and caters to both the AGCC and the Africa markets.
It has also built a strong vendor base with 61 suppliers across the country, of which seven are within a two-km radius of the manufacturing plant. Ashok Leyland also has a fully-enabled spare parts warehouse in Sharjah.
The company's international team in Dubai consists of product development, manufacturing operations, project planning and sales operations. The company plans to have an entirely new product portfolio of trucks and buses in the AGCC within the next two to three years.
Leading its portfolio expansion is Oyster, a premium mid-sized bus equipped with best-in-class features for maximum safety and comfort. Oyster is AGCC's first rollover and front crash compliant bus, ensuring total safety for passengers in case of any accident.
The benefit of the geographic location of Dubai and the industry-friendly policies allow the company to operate freely in its core anchor markets like the SAARC region, the Middle East, across Africa, ASEAN and CIS. The company also has investment plans to develop sales and service training centres apart from its manufacturing capacity.
The top Indian truck-and-bus maker exports vehicles to over 30 countries worldwide. It is a leader in the bus markets of Sri Lanka, Bangladesh and Mauritius and has significant presence in the Middle East and Africa too.
It is a leading participant in the bus rapid transport (BRT) system in Lagos, Nigeria. Ashok Leyland is also seeking to make inroads into CIS and Latin America.
"We already have a plant in Sri Lanka and earlier this year we set one up in Bangladesh," says Dasari. "We are likely to put up another one in Kenya, probably one in Russia too. Ultimately, we plan to have half a dozen overseas assembling and manufacturing units."
Ashok Leyland has built a reputation of being known as an innovator, explains Dasari. "We were the first to bring CNG and electric vehicles and the first multi-axle vehicle of any type to India. We continue to focus on innovation."
He recalls Ashok Leyland was the only company to achieve Euro three norms from mechanical fuel pumps.
Referring to the company's vast experience in the Indian defence segment - it has been associated with the Indian defence ministry for nearly three decades - Dasari says it is capable of producing all kinds of vehicles for the armed forces. "Our exposure to the defence sector will keep expanding over the years," he adds.
Rajive Saharia, the Dubai-based President for Global Sales and Distribution, says he is bullish about the growth of the company's overseas operations.
According to him, the company, which is the flagship of the Hinduja group, has identified six clusters around the globe for setting up - or boosting - its presence. These include Nepal, Bangladesh and Sri Lanka (in the first cluster); the Gulf (which will look at the Middle East and North Africa); CIS and Russia; rest of Africa; the Asean cluster; and Latin America.
With the company's business being cyclical, it is important for Ashok Leyland to expand international operations.
Saharia notes that the company achieved the highest-ever Q1 (April-June) market share of 34.7 per cent this year. It gained year-on-year market share in 12 of the previous 13 quarters. The company attributes the market share growth in the last quarter to the success of its innovative iEGR technology for BS IV engines, launched in April.