Hero Motors in auto part push

NEW DELHI: Munjals family-promoted Hero Motors, part of the $4.5-billion Hero Group, will invest Rs 100 crore in five years in its auto-part plant in Ghaziabad. It has signed up with Canadian firm BRP Powertrain for automotive transmissions and components.

As per the agreement, BRP will supply design and technology to Hero Motors to manufacture these components with a buy-back arrangement. The companies have signed a five-year memorandum of understanding (MoU) for manufacturing transmissions at Hero Motors' Ghaziabad facility, which has an installed capacity of 1 lakh units per annum.

Both companies have jointly invested Rs 45 crore in the past two years for the manufacturing base in Gaziabad for making automotive transmissions. Hero Motors is aiming a $250-million (Rs 1,250 crore) turnover from the transmission business in the next five years.

Hero Motors MD Pankaj Munjal told mediapersons in Delhi on Tuesday that besides being the global manufacturing base for BRP, the company will also set up Hero Innovation Centre to develop technology for future use. Hero Motors will develop capability to develop components on its own and cater to needs of other global companies.

"We are poised to grow through developing products on our own," he said. Hero Motors had clocked a turnover of Rs 360 crore from transmission, fitness equipment and automotive discs business last year, of which half came from the overseas markets.