Yamaha to set up a new two-wheeler plant in Tamil Nadu

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SME Times News Bureau | 14 May, 2012
Two-wheeler maker Yamaha Motor India Monday announced to open a new two-wheeler factory in Tamil Nadu after signing a Memorandum of Understanding (MoU) with the government of Tamil Nadu today approving the construction and operation of a new two-wheeler factory in the state.

The new facility will join the currently operating factories of India Yamaha Motor Pvt. Ltd. (IYM) at Surajpur (UP) and Faridabad (Haryana) to meet the rising demand for two-wheelers in India.

The new factory is to be constructed on a lot of approx. 440,000 m2 in an industrial park in Vallam Vadagal on the outskirts of the city of Chennai, Tamil Nadu. Plans call for the construction of a factory facility with a total floor space of approx. 114,000 m2 and is scheduled to begin in September 2012, with completion and start of operations scheduled for January 2014.

According to plans, the new factory will employ 1,800 people and have an annual two-wheeler production rate of 400,000 units at the start of operations. Production capacity will then be increased in stages to a level of 1.8 million units annually by 2018, at which time employment is expected to reach 6,500 people.

The forecast for the total investment in the new factory and facilities is approx. Rupees 1,500 Crores over the next five years.

Commenting on the occasion, Hiroyuki Suzuki, CEO & Managing Director, India Yamaha Motor said, "We are very pleased with this development as this is in line with YMC’s medium-term management plans of enhancing local production levels to meet the demand growth in emerging markets such as India and their export markets. The Indian two-wheeler industry has witnessed much growth in the last few years, attributable to increased disposable income levels among a rapidly expanding middle class. We expect the industry to attain 20 million units level by 2016 when we are targeting to sell 2 million units and achieve 10% market share."

"We would also like to thank all the concerned Tamil Nadu government departments, especially Guidance Bureau which had extended its complete support to this project by facilitating as a true single window body," he added.

To keep pace with this current growth in demand, plans have been implemented to boost the existing factory’s annual production capacity of 600,000 units to One Million units on an investment of approx. Rupees 750 crores in 2012.