Meanwhile, the company has started working on developing BS-VI technology which is expected to get implemented by the year 2020
Eicher said that it will be supplying 2000-odd buses to Karnataka in the next three months and expects orders from other states including Maharashtra and Bihar.
Vinod Aggarwal, MD and CEO at VE Commercial Vehicles (VECV), which is a joint venture (JV) between Eicher Motors Ltd and Volvo Group, said that the bus business is growing backed by demand for school and state transport buses, infrastructure development and smart cities. "We will start delivering 2,000 buses to Karnataka in over next three months. Around 1,000 have already been delivered earlier. It is both for inter-city as well as intra-city transportation," said Aggarwal on the sidelines of the launch of company's Pro 5000 series - a range of heavy-duty trucks. The PRO series will be available from 16 T to 40 T.
Meanwhile, the company has started working on developing BS-VI technology which is expected to get implemented by the year 2020.
"The upgradation to BS-VI will happen for over a period of next three years and requires significant investment," he added.
As per reports, the company makes an investment of about Rs 400 crore every year in its product development and a similar amount is likely to be spent on upgradation to BS-VI over the next three years.
Indian automobile industry will skip BS-V technology and jump directly to BS-VI by the year 2020. BS-IV has already been implemented since the start of this month.
VECV last year sold around 58,600 units of buses and trucks, growing 12.6% over the previous year. The company is into sales and distribution business of high-end Volvo trucks.
Talking about the impact of demonetization and BS-IV implementation on the company's performance, Aggarwal said that there was just a minor effect. "The fact is we had cut production of our products by almost half in December (producing just around 2500 units) after demonetization, and thereby, were just having a hand-to-mouth existence at that point in time. So, when BS-IV implementation order came from the apex court, we just had around 900-1000 units of BS-III vehicles in plant and another 400-500 with dealers. So, this small number of inventory can easily be exported and can even be upgraded to BS-IV," he added.
Further, Aggarwal believes that implementation of GST combined with economic growth in the country and infrastructure development will give further impetus to the growth of commercial vehicle (CV) sector in India.
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