Japanese automaker Isuzu Motors is setting up a greenfield manufacturing facility in Andhra Pradesh

Japanese automaker Isuzu Motors is setting up a greenfield manufacturing facility in Andhra Pradesh. Senior officials from the company and from the state government signed a memorandum of understanding to this effect on Friday, March 15. The facility, which is being set up with an outlay of Rs 1,500 crore, will be located in Sri City in Chittoor district, about 55 km from Chennai. 

The manufacturing unit is expected to come up by the end of 2015 and serve both the domestic market as well as export market. The plant is being set up with capacity to make about 100,000 LCVs and SUVs. Isuzu has acquired 430,000 square metres of land for the project. 

Upbeat at the fact that the project was coming close on the heels of Mahindra and Mahindra inaugurating a major tractor making unit in Andhra Pradesh, state chief minister N. Kiran Kumar Reddy said: "The automotive industry had (virtually) gone away from Andhra Pradesh for a long time and our goal is to get not just auto makers to the state but also see that a complete range of products from two wheelers to aircraft comes to Andhra Pradesh." 
 
Isuzu started sales of its pick-up truck D-MAX and pick up derivative MU-7 this month, importing them from Thailand and marketing them in India. Once ready, the facility in India will support the LCV operation in Thailand. 
 
The company sees a lot of potential for growth in India. In a media release at the event, it says, India's automobile industry has annual sales of 3.6 million units. Within this, it says the pick-up truck segment, which is the core product of Isuzu's LCVs, has expanded at a higher speed with annual sales of 200,000 units. The company, it says, aims to expand its business in India by developing products that match local market needs.