The RAK plant capacity expansion, from 12 buses a day to 24 buses daily by end of 2016, is part of a global expansion plan by the fourth largest commercial vehicle maker in the world.
Published: Fri 4 Mar 2016, 7:25 PM
Dubai: Ashok Leyland, India's second largest commercial vehicle manufacturer, announced on Thursday expansion of its bus manufacturing plant in Ras Al Khaimah to double production capacity.
His Highness Shaikh Saud bin Saqr Al Qasimi, Member of the UAE Supreme Council and Ruler of Ras Al Khaimah, laid the foundation stone for the $10 million expansion project that also incorporates a Design and Service Training Centre.
The Chennai-headquartered commercial vehicle manufacturer is the flagship brand of the Indian conglomerate Hinduja Group.
The RAK plant capacity expansion, from 12 buses a day to 24 buses daily by end of 2016, is part of a global expansion plan by the fourth largest commercial vehicle maker in the world.
The $2.2 billion Ashok Leyland, boasting an annual production 150,000 units, also plans two smaller assembling facilities in Kenya and Ivory Coast. It has also initiated plans to set up an assembly plant in Dammam, Saudi Arabia.
The RAK stone-laying ceremony was attended by Shaikh Nahyan bin Mubarak Al Nahyan, Minister of Culture and Knowledge Development, G P Hinduja, Dheeraj G Hinduja and other dignitaries from the Hinduja family along the senior management of Ashok Leyland including Vinod K Dasari, Managing Director.
Dasari said the RAK plant is critical for supplying buses to address the needs of GCC countries. "With our ambitious plans for Africa, we foresee further expansion of the facility."
Ashok Leyland's RAK factory is a joint venture with the Ras Al Khaimah Investment Authority (RAKIA) and is the only certified local bus factory in the UAE and GCC region.
"A pioneering hub for auto manufacturing, our plant has deepened economic and trade links between India and the UAE, and helped Ras Al Khaimah' s continued economic growth. Both direct and indirect employment is set to rise significantly with this increased capacity," Dasari said.
The RAK plant, inaugurated in 2010 by the Ruler of Ras Al Khaimah, will be made into a centre of excellence for its overseas expansion and the establishment of the new design and service training centre was a move in this direction.
"We are aiming to grow significant localization levels soon and towards this we are working very closely with RAKIA on creating an automotive cluster in Ras Al Khaimah where our vendors will set up shops," said Dasari.
Dasari said the vehicle-maker would be foraying into the value-premium segment of the automotive market of UAE and the GCC region this year as part of enhancing product portfolio. "This would be in addition to our predominant presence in the school bus segment of the UAE with a market share of over 70 per cent owing to our robust design and enhanced safety features," Dasari said.
Dasari said the new $10 million investment in the RAK plant is aimed at expanding production of current models and introducing new models into the regional market, which will include midi buses and trucks.
Apart from Africa, Ashok Leyland is setting its eyes on South East Asia and South American markets. The three regions are expected to boost its export volumes over the next 3-5 years and the company expects the share of exports in revenues to grow to 25-30 per cent from about 10 per cent now.
- issacjohn@khaleejtimes.com
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