Date:28/07/2007 URL: http://www.thehindubusinessline.com/2007/07/28/stories/2007072851971300.htm

Back Mitsubishi Heavy, VST plan unit for small diesel engines

G.R.N. Somashekar

Mr K. Yoshida (left), Executive Vice-President and General Manager, Mitsubishi Heavy Industries Ltd, Japan,and Mr V.K. Surendra, Chairman, VST Tillers Tractors Ltd, at a MoU signing between MHI and VST Tillers in Bangalore on Friday. —

Our Bureau

Bangalore, July 27 Mitsubishi Heavy Industries Ltd, Japan, and VST Tillers Tractors Ltd have agreed to set up a manufacturing facility for small diesel engines in Mysore.

Mitsubishi will hold majority stake of 90 per cent in the venture that will produce engines with capacities up to 50 horsepower.

This is the second joint venture between the two companies, the earlier one was set up in the late sixties for producing power tillers and agricultural machineries.

The new joint venture, MHI-VST Diesel Engines (P) Ltd, will invest Rs 41.5 crore in the first phase of the project to produce 30,000 units of engines. Initially, the company will start assembling the engines in December. Full-scale production will start a year later, said Mr A.T. Nahender, Director, MHI-VST Diesel Engines.

The Indian market for diesel engine is rapidly growing through various applications into genset, marine, mobile phone towers, tractor and agricultural machinery, etc. The current annual domestic demand (below 50HP) is estimated at over five lakh units.

MHI VST Diesel Engines will explore export possibilities for its engines to neighbouring countries such as Bangladesh and Sri Lanka under the Mitsubishi’ brand name, said Mr B.C.S. Iyengar, Vice-President (Commercial), VST Tillers Tractors Ltd.