Bajaj Auto not to make 4-wheeler at Chakan plant

Bajaj Auto Ltd has changed tracks on utilising the plot of land it had acquired at Chakan, near Pune, for the manufacture of 4-wheelers and has now approached the Maharashtra Industrial Development Corporation (MIDC) with a revised plan to make two- and three-wheelers there instead.

The 250-acre plot of land had been acquired in 2008 for a 4-wheeler project. This was also when the prospect of the Bajaj-Renault ultra low-cost car was its height. The relationship did not materialise as expected. BAL has in fact gone ahead with its own 4-wheeler — christened RE60 and unveiled recently — and announced that it will be made at Aurangabad.

Since MIDC rules prescribe that land allocated must be used within a specified time frame (end-2011 in this case), the Corporation sent BAL a letter on the issue. Responding to a query by Business Line on the subject, Mr Yuvraj Poman, Deputy CEO, MIDC said, “Around one month ago, Bajaj sent us a letter stating that it wanted to change the activity on this land from 4-wheelers to two and three wheelers.” The MIDC had asked the company for a Detailed Project Report (DPR) on their new plans for the Chakan land, he added.
Capacity utilisation

Bajaj Auto's Managing Director, Mr Rajiv Bajaj, did not respond to an email query seeking confirmation of the decision.

With sales numbers expected to touch over 4.5 million vehicles during the current fiscal, and total installed capacity across three manufacturing facilities in India — Chakan, Pantnagar and Aurangabad — standing at a little less than five million units, the company is nearing capacity utilisation.

“Of course we need to increase capacity,” an official of the company, who preferred to not be named, said, without commenting on plans or location of a fourth manufacturing facility.

Though last year Mr Rajiv Bajaj had hinted that the company may implement its expansion plans outside of Maharashtra, BAL already makes its Pulsar and some bikes from the KTM range at Chakan. With a plot of land and a ready supplier base, a second plant in the same locality will make eminent sense.