Ashok Leyland working on JV in South Africa

Pretoria: Following compatriots Tata and Mahindra to this market, India's second largest truck maker Ashok Leyland is planning a joint venture with a Black Economic Empowerment (BEE) partner to introduce products like 4x4s and luxury buses in South Africa.

Under the arrangement, the South African partner would own 49 per cent stake in the new company, which would run assembly line plants in Durban and Centurion, near here, a local daily reported.

Quoting the Chennai-based company's Executive Director of International Operations Rajinder Malhan, Pretoria News said the company's target was to sell 400 vehicles worth 40 million Rand in the first year.

'We are still finalising the details and the structure of the company,' which will have a new name, he said hoping to announce the details this week, the daily said.

Ashok Leyland, the flagship company of Hinduja group, started trading in South Africa six years ago, but the operations are yet to be profitable. It has a warehouse in Johannesburg, it said.

The report quoted Malhan as saying that the company had taken too long to introduce new products and most did not meet the requirements of the SA Bureau of Standards. 'Our new products are compliant', he said, adding that the new products would include trucks, 4x4s and 12m luxury buses.

Tata sells buses and cars in South Africa, while Mahindra sells its SUVs Bolero and Scorpio.

The BEE programme was launched by the South African government to redress inequalities of Apartheid by giving underprivileged groups economic opportunities.