[JayPrashanth]

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The Volvo-Eicher commercial vehicle joint venture has given India its first Euro 6 turbo diesel engine manufacturing facility. The factory is situated at Pithampur, Madhya Pradesh, and will build 25,000 Euro 6 turbo diesel engines. The Euro 6 emission norms compliant diesel engines will be shipped to Volvo's Venissieux factory at France, to be assembled into 5 liter and 8 liter motors, for use in the Swedish truck and bus maker's medium duty products.



The same platform will be used to build Euro 3 and Euro 4 turbo diesel engines for the Volvo-Eicher range of commercial vehicles. The engine making factory has been set up at a cost of 375 Crore Rupees and is capable of producing 25,000 engines per annum. The engine factory's capacity can be boosted to 100,000 units per annum with an additional investment of 125 Crore rupees. The engines produced in this factory will be available in power outputs ranging between 180 Bhp to 350 Bhp.

Thus far, Volvo and Eicher have invested 1,300 Crore Rupees in the joint venture formed to build commercial vehicles (CV) and engines. An additional investment of 1,200 Crore Rupees will be made over the next 2-3 years. Volvo and Eicher were manufacturing commercial vehicles independently in India before joining hands for the Volvo-Eicher Commercial Vehicle 50-50 joint venture, half a decade ago.



Ever since, Volvo has provided Eicher with technology for a new range of heavy duty commercial vehicles. The VE series of Eicher HD trucks was launched in India during 2010, and these trucks have boosted Eicher's market share amid growing competition. The joint venture (JV) works by giving Volvo access to frugal manufacturing facilities and the growing small and medium truck market in India. The frugal manufacturing set up has allowed Volvo to cut costs.

The Euro 6 engine making unit is a prime example of these cost savings. Eicher, for its part, gets access to improved technology that enables it to face competition from global trucking giants such as Tata Motors, Daimler (Bharat Benz in India) and Scania. The JV also gives Eicher access to Volvo's global distribution network, thus allowing the Indian CV maker to sell its truck range in lucrative export markets.

Apart from its joint venture with Eicher, Volvo continues to build luxury buses, and trucks for specific applications such as mining and container transport at its Hosakote factory, off Bangalore. Volvo also sells its range of luxury cars in India. However, the luxury car division, which was acquired a few years ago by Chinese automaker Geely, is independent of its namesake trucks and bus business.