India is back on the agenda this week, as DaimlerChrysler – which already holds a 6.8 per cent stake in Tata Motors and a 3.6 per cent stake in Eicher through its Fuso unit – looks to bolster its presence in the region.
Tata is by far the biggest player here, with Ashok Leyland coming in second. Eicher – best known in the West as the owner of the Royal Enfield brand – is a long way behind the big two, but seems to be DC preferred choice. In part, Tata’s deal with Fiat has probably parked any opportunity for a non-Fiat CV deal at present, leaving Eicher as the only game in town.
We like what we see. Eicher is quite busy in the 5 – 11 tonne range, and has outpaced the fast growing Indian market in terms of sales over the past couple of years. More to the point, its 1986 deal with Fuso means that there is a 20,000 capacity plant at Pithampur in Central India offering a springboard for CKD heavy truck production. Mercedes Benz India is already marketing two Actros variants: the 4040K and the 4840K, and the argument for either an Axor or a Brazilian Acello seems to be pretty compelling. Taking a bigger stake in Eicher would provide a good – and reasonably baggage free – launch platform for access to one of the world’s most significant CV markets. Conversely, a stake in Tata would provide baggage aplenty.
As ever, we wait and see, but with India now the focus of just about all of the European OEM’s, dance partners are in short supply. DC needs to get this one nailed down in the near future.