CHITTOOR: While all the major Original Equipment Manufacturers have their presence in Southern India, Hero MotorCorp on Friday made its maiden foray into the south, laying the foundation stone for a Rs 1,600 crore manufacturing facility in Andhra Pradesh. It also plans to invest an additional Rs 1,600 crore in ancillary units.
Hero Motorcorp has chosen as its base SriCity of Chittoor district, rather than the Sriperumbudur-Oragadam belt of Tamil Nadu, which is home to many major auto factories including Hyundai Motor India Ltd, Renault-Nissan, Daimler India Commercial Vehicles Pvt. Ltd and Ashok Leyland Ltd.The greenfield facility will be the eighth globally and will have an installed capacity of 1.8 million units, which will be achieved in three phases. The facility will provide direct employment to 2,000 people, while it is expected to add another 10,000 jobs through creation of manufacturing ecosystem of vendors and suppliers in the region.
The factory is expected to be operational by December 2019 and will cater to both domestic and export markets. “When fully operational, this facility will take up our total combined installed capacity to 11 million units of motorcycles and scooters per annum, which is in line with our vision of surpassing 10-million unit volumes by 2020,” HMCL’s Chairman, Managing Director and CEO Pawan Munjal said.
Welcoming the investment from Hero Motors in Andhra Pradesh, Chief Minister N Chandrababu Naidu said, “I want to set up a world-class auto manufacturing hub in Andhra. So far, Anantapur and Chittoor districts have attracted investment worth Rs 35,000 crore in the automobile sector alone — the biggest investment post bifurcation (of the state in 2014).”
Naidu said the state has signed 2,536 MoUs in last three years, which will pull in investments of about Rs 1,855,000 crore to generate employment for around 4,428,000 people in the state. Of this, Rs 540,000 crore worth of investments are already made and this has created jobs for about 1,063,000 people. Further, companies such as Ashok Leyland, Bharat Forge, Apollo Tyres and even TVS Brakes are also moving in full swing, he said.
Why AP?
Proximity to a huge market like Chennai, easy access to airports in Chennai and Tirupati, connectivity to Krishnapatnam port in the north, and Ennore and Chennai in the south, as well as National Highway-5 and railways, is what makes SriCity and adjoining areas attractive to industrialists, Naidu said.