The Sonalika Group, makers of the Sonalika range tractors, said on Tuesday that it has signed a technical collaboration agreement with MG Rover Group Ltd., U.K.'s largest independent auto maker, to manufacture a Sports Utility Vehicle (SUV) to be launched next year. This marks the Group's foray into the SUV segment, a move supported by a Rs2bn investment, the unlisted tractor maker said in a statement.
Announcing the plans L.D.Mittal, Chairman, International Cars & Motors Ltd. said, "Our entry into this segment is driven by our research which indicates that there is a large market for SUVs in India. An offering that is superior in technology and highly competitive in pricing will create an entirely new market both for current car users who will upgrade to the SUV segment as well as for non-users. The potential is immense and more importantly, untapped."
"We are proud to be partnering with MG Rover, and we believe that the marriage of Rover's technical excellence and experience in the field with our superior capabilities will produce a vehicle that will exceed all expectations. I am very excited," he added.
Commenting on the occasion, Michael J. Booth, Corporate Head - Product Development, MG Rover, UK, said, "We are delighted to be asked by Sonalika Group to provide technical collaboration on this project. It is another example of the international recogonition of the engineering skills we have in the MG Rover Group."
The SUV, slated to hit Indian roads in the first quarter of 2005, would be manufactured under the banner of a newly formed Group company - International Cars & Motors Ltd, said Sonalika.
The new 100-acre facility to be set up at Himachal Pradesh - a Tax Free Zone, would have a state-of-the-art assembly line, and an annual capacity of 24,000 vehicles in the first phase, it added.
Moreover, the Sonalika Group signed a long term collaboration agreement with Powertrain Ltd., Britain's largest independent power unit manufacturer.
As per the deal with Powertrain, International Cars & Motors has been granted a manufacturing license to build a new common rail diesel engine and six speed gearbox.
These engines would be used in the new SUV, said sonalika adding that the agreement allows International Cars & Motors to provide assemblies and components to Powertrain.
The engines would be manufactured at a new engine plant in Himachal Pradesh, said Sonalika.
Commenting on the tie up, Fraser Welford - Winton, Managing Director, PowerTrain Ltd. said, "Sonalika are experienced in working with European companies and operating to global quality and cost targets. In addition the cultures and sizes of the two companies are very compatible in making this a win-win situation."
Set up in 1968, the Rs10bn Sonalika group is the parent to International Tractors Ltd., one of the world's foremost tractor manufacturers. Its key product - the Sonalika Tractor with Euro II compliant engines - has become a household name in the farming community in India.
The MG Rover Group is the U.K.'s largest independent car manufacturer with over 100 years experience in building passenger, sports and racing cars.
Power Train Ltd. is a leading U.K. engine manufacturer supplying global brands such as Land Rover, MG, Rover, Lotus, Caterham Cars, Gibbs Technologies and other customers.
Both MG Rover Group and Power Train are a part of the US$3.5bn Phoenix Venture Holdings Ltd.
Source : India Infoline