Hero MotoCorp Ltd has a vision of expanding its global footprint to as many as 50 countries by 2020, and in this bid, the world’s largest two-wheeler manufacturer, today marked yet another significant milestone in its journey to global expansion–the formation of its wholly-owned subsidiary in Colombia and the commencement of a state-of-the-art manufacturing plant in the country.
The foundation-stone was today laid by Mr.Pawan Munjal, Managing Director & Chief Executive Officer, Hero MotoCorp Ltd, at the project site today. Also present on the occasion were senior representatives of the Colombian government, the Senior Leadership Team from Hero MotoCorp and other associates.
“The commencement of our operations in Colombia is a definitive leap into the next level of our global foray. Having already spread our footprint to19 countries across Asia, Africa and South and Central America, we are fast setting up a network of manufacturing facilities across continents to cater to the existing and newer markets. 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$70 million in the country.
With the setting up of the state-of-the-art world class plant here, we will bring the latest modern technology into the country. As we grow our dealer network and localise our operations, we will generate immense direct & indirect employment, thereby contributing to the overall development of Colombia.” said Mr.Pawan Munjal, Managing Director & Chief Executive Officer, Hero MotoCorp Ltd.
With a project cost of US$ 70 million, HMCL will invest US$ 38 million in CAPEX, with the rest being utilised as working capital over the next three-year period. The equity investment will be made through HMCL’s wholly-owned subsidiary in the Netherlands –HMCL BV.
The state-of-the-art manufacturing plant – spread over 17 acres (68,000 sq meters) of land at the Parque Sur Free Trade Zone at Villa Rica in the state of Cauca – about 500 km south-west of Bogota – is expected to go on stream by the middle of calendar year 2015 with an initial installed capacity of 78,000 units. This will go up to around 150,000 units in the second phase. With this, the New Delhi-headquartered Hero MotoCorp will be the first Indian two-wheeler company to have a manufacturing plant in Latin America.