With localisation Hyosung might get real cheaper

SK Hyosung will set up a plant in Maharashtra and manufacture most of its brands sold in the country, a top official of the company said here on Monday on the sidelines of its first dealership opening in Jaipur.

"Plans are already in place for a manufacturing facility that will come up in Maharashtra. It will 18 months to build the plant and the rollout of products is likely to happen in two years," Shivapada Ray, chief operating officer of DSK Motowheels.

DSK stated that the new plant will commence assembly operations in the next 7-8 months and will attract an investment of Rs. 95 crores. This plant will have an initial capacity to produce 5000 units per year. Out of the total investment, Rs. 75 crores have been allocated towards building construction while the rest is towards installation of machinery.

This investment is just a fraction of the earlier Rs. 400 crores which were supposed to be put up by DSK for the new plant. The new facility will come with heavy localization levels which will subsequently result in lowering the prices on Hyosung’s model range.

The automaker is planning to launch three new products later this year which will include the GD250N and GD250R single-cylinder motorcycles while there is also a 300cc cruiser set to touch the Indian market.

With the automaker aiming a healthy 80 percent localisation level, the company is optimistic that it will be able to bring the prices down to Rs. 1.75 lakhs on some of its models. That said, localising will commence only after 17-18 months, once the component suppliers are setup.