Volvo Eicher Commercial Vehicles (VECV), part of the Eicher Motors Group has announced that it will be acquiring Volvo Buses India (VBI) for Rs. 100 crore. The announcement says the Volvo Buses India will be integrated into VECV that includes the manufacturing, assembly, distribution and sale of the Swedish automaker's bus business in India, which so far was a part of Volvo Group India Private Limited. The bus manufacturing facility at Hosakote, Bengaluru and all employees under VBI will be transferred to VECV as part of the deal. Akash Passey, Senior Vice President, Volvo Bus Corporation, has been appointed as the President of the new VECV bus division. He will be reporting to Vinod Aggarwal, MD and CEO, VECV.
Also Read: Eicher Motors Introduces Connected Technology Across Entire Commercial Vehicle Range
Speaking on the announcement, Siddhartha Lal, Chairman, VECV said, "This is a momentous occasion and testimony to a very strong relationship between Eicher Motors and Volvo Group. Over a period of time, the Volvo brand for buses in India has become synonymous with safety and comfort in both inter-city and intra-city public transportation, and we are extremely proud to have this iconic brand in our joint venture. With the integration of Volvo Buses India into VECV, we aim to shape the future of the Indian bus industry by offering the widest range of transport solutions to our customers.
Vinod Aggarwal (in pic) MD and CEO - VECV will continue to lead the group with Akash Passey, Sr. VP - Volvo Bus Corporation, has been appointed as the President of the new VECV bus division
As a result of the deal, a division comprising Eicher and Volvo bus business will be created. The companies have also confirmed that no debt of Volvo has been taken by Eicher as part of the agreement. The integration aims at consolidating the resources and synergies between the two groups under the new bus division. The new bus business will not only cater to market demands in India but also offer products and services for exports, in-line with Volvo Buses' global portfolio.
Speaking on the integration, Hakan Agnevall, President - Volvo Bus Corporation said, "We are pleased with this development of Volvo Buses in India and see it as an opportunity to further build upon the successful JV company - VECV. By consolidating the operations of Volvo Buses India into VECV, we aim to further develop our bus business and strengthen our position in the Indian bus market. The new bus division will offer a full range of modern buses covering customer needs for heavy, medium and light-duty buses,"
Volvo will continue building its range of premium buses in India with the new venture to explore newer segments
Adding further, Vinod Aggarwal, MD and CEO, VECV said "VECV's strong presence in the Indian bus market with Eicher branded buses will be complemented by Volvo Buses' prominent position in the premium bus segment. With this integration, VECV will be able to leverage synergies in the areas of product development, purchasing and manufacturing with access to Volvo Group's world-class technology in buses.
Also Read: Coronavirus Impact: Eicher Motors Net Profit Plunges To Rs. 304 Crore In Q4 FY20
Akash Passey, Senior Vice President, Volvo Bus Corporation, said, "Going forward, customers and partners can expect the same high level of customer care and world-class products from both Volvo and Eicher brands. The new division will also engage further in the dynamic Indian market driven by megatrends such as urbanization, e-mobility and connectivity."
India remains one of the top three bus markets globally
VECV says the transaction will be completed once the conditions under the agreements are fulfilled. The business transfer is expected to be completed within the next two months. VECV also confirmed that the Hosakote plant will work independently of the manufacturer's Pithampur facility. The CV maker has also hinted at the new business venturing into newer segments including electric mobility in the future. India remains one of the top three bus markets globally and is expected to grow in the coming years, despite the setback in current times.
