The car manufacturing unit proposed by MLR Motors on the outskirts of Hyderabad remains a non-starter even as the company’s deadline to achieve financial closure by March nears.
The company, which has been allotted 225 acres for the project at Toopran near Hyderabad, had stated that the venture to build small cars would cost about Rs 1,250 crore.
“We are working on the project. It will take another three months for things to become clear,” the company’s managing director M Lokeshwar Rao told DNA Money. According to him, they are yet to put in place a consortium of lenders. “I can’t talk about details of the project at this point. But, we are putting things in place,” he said.
The foundation stone for the project was laid in April 2007 with the financial closure planned to be achieved in a year.However, after the company sought an extension, the government offered time till October 2008 and then again extended the deadline to October 2009 for fixing up the finances. However, blaming it on the recession the company for the third time convinced the government to give time till March 2010.
Meanwhile, it is planning to use Fiat’s Uno platform to build the car though various other tie-ups to test the car and fine-tune it are being put in place.
State government officials said that the project would definitely be executed despite the delays due to factors that are “out of the company’s control.” “We are still hopeful that the company will go in for production by December 2011. There seem to be delays in finalising the funding sources.” a state government official said.
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