Hero to launch Colombian subsidiary
Hero MotoCorp Ltd. (HMCL) will inaugurate the first Indian two-wheeler manufacturing plant in Latin America. The Indian two-wheeler company is keeping with its vision of expanding its operations on a multinational scale by establishing subsidiaries in at least fifty countries by 2020. Hero MotoCorp, the world’s largest motorcycle manufacturing company will soon have a wholly owned subsidiary in Villa Rica, Cauca, Colombia. Their products are sold in 19 countries across Asia, Africa, Central and South America. The factory opening in Colombia has a projected cost of about Rs 418 crores, Hero will invest Rs 227 crores in CAPEX while using the balance as working capital over the next three years. The factory is spread over 17 acres at the Parque Sur Free Trade Zone in Villa Rica.
After splitting from its former partner Honda, Hero has fast augmented its global presence. HMCL has established assembly plants in Kenya, Tanzania and Uganda in East Africa. With two new plants coming up — the one in Colombia, and another in Bangladesh through a joint venture. Hero MotoCorp has sold a record breaking 6.25 million two wheelers in the previous financial year 2013–14. By 2020, Hero MotoCorp Ltd. plans to cross 100 million units in production and a global sale of 12 million units of bikes as well as scooters.
“The commencement of our operations in Colombia is a definitive leap into the next level of our global foray. Today, we laid the foundation stone of our manufacturing plant at Villa Rica in Colombia, the first full-fledged plant by an Indian two-wheeler manufacturer in Latin America. Once operational towards the middle of Financial Year 2015–16, the plant will have an annual capacity of 78,000 units that will be scaled up to 150,000 units in the next 3–4 years. Through our fully-owned subsidiary in Colombia — HMCL Colombia SAS — we will be investing US$70 million in the country,” says Pawan Munjal, MD & CEO, Hero MotoCorp Ltd.
