ZF and Hero Motors Ltd form joint venture - ZF Hero Chassis Systems

Written by Ganesh Wednesday, 03 March 2010

New Delhi: ZF and Hero Motors Ltd. today signed a contract establishing the joint-venture enterprise ZF Hero Chassis Systems. ZF is acquiring fifty percent of Hero Chassis Systems including two assembly plants in Halol, around 300 miles north of Mumbai, and in Talegaon, near Pune having an annual installed capacity for assembling 1.6 lakh units of chassis and axle systems. Over the next two years ZF Hero Chassis Systems will invest Rs 80 crore to set up two new plants in Gurgaon and Chennai. These 2 new plants are expected to have an annual installed capacity for assembling 2.9 lakh units of chassis and axle systems. The joint venture company will initially focus on the small car segment and then diversify into bigger cars. "The aim of the joint venture is to enable us to offer ZF chassis technology to the Indian car market at local costs. Our durable, rugged, resource-saving products are recognized by customers around the world. The tie-up with Hero Motors will allow us to design and produce them at marketable prices for models ranging from mini to compact for the Indian market. To accomplish this to an optimal degree, we will be establishing our own development operations in India to support the joint venture. In addition, collaborating with Hero will open up new opportunities for us to start manufacturing high added-value pressed sheet metal components for small-vehicle axle systems ourselves," said Peter Holdmann, Head of the Chassis Systems Strategic Business Unit of the Car Chassis Technology Division and in charge of ZF axle system business activities. Initially, some 100 employees will be engaged in the assembly of car axles for General Motors. The contract was signed by Peter Holdmann and Hero Group's company director Pankaj Munjal in New Delhi. "The excellent reputation and market expertise of the Hero Group and the owning family Munjal will smooth our access into the Indian automotive market. Our contribution to the joint venture will be ZFs technological expertise and our broad know-how in chassis design," said ZF CEO Hans-Georg Hrter.

Hero Motors ties up with German company

Mr Pankaj Munjal, MD, Hero Motors Ltd (left),exchanging documents with Dr Peter Holdmann, Head ofZF's Car Chassis Systems Strategic Business Unit, in theCapital on Tuesday. - Kamal Narang Our Bureau New Delhi, March 2 Auto component maker Hero Motors Ltd announced on Tuesday a partnership with the Germany-based ZFLemforder, under which it has formed a new joint venture company called ZF Hero Chassis Systems. The new company, formed after the ZF Group's acquisition of a 50 per cent stake in Hero Motors' Chassis Systems business, will invest Rs 80 crore over the new two years to set up two new plants. Hero Motors, part of the $4.5 billion Hero Group, will hope to leverage ZF's technological expertise in the design and manufacturing of chassis systems for the small car market in India. Chennai plants We will invest Rs 80 crore over the next two years to set up two new plants in Gurgaon and Chennai. These will cater to the northern and southern markets respectively. The two new plants will take our total capacity to 4.5 lakh units. We will initially focus on the small car segment and then diversify into bigger cars and mainly target domestic OEMs, said Mr Pankaj Munjal, Managing Director, Hero Motors. The joint venture company has already started with two production facilities at Halol, Gujarat and Talegaon, Maharashtra, which have a combined annual capacity of 1.6 lakh units. It currently supplies front corner module and rear axle assemblies to General Motors India for all of their car models. According to Mr Munjal, talks are on with other OEMs such as Suzuki and Tata Motors for supply of chassis parts. Hero Motors also operates a joint venture with the Japanese firm Sumitomo and a technology agreement with Magna.

ZF-Lemforder forms JV with Hero Motors, takes 50 per cent stake in Hero Chassis Systems
news

03 March 2010

Hero Motors Limited has sold 50 per cent stake in its subsidiary Hero Chassis Systems to German auto component firm ZF-Lemforder for an undisclosed sum as part of a deal with ZF group to form a joint venture company, ZF Hero Chassis Systems Pvt. Ltd, to design and manufacture chassis and axle systems to sell in the Indian market. The Munjal family, the co-promoters of Hero Motors Limited, part of the $4.5 billion Hero Group have sold a 50-per cent stake in their privately owned Hero Chassis Systems, for an undisclosed sum. New Delhi-based Hero Motors signed a JV with the German compaqny, based in Friedrichshafen, based ZF-Lemforder, part of 12.5 billion ZF Group to form a joint venture company ZF Hero Chassis Systems to design and manufacture chassis and axle systems for the booming market for small cars in India. Included in the joint venture company are Hero Motors' two production facilities at Halol in Gujarat and Talegaon in Maharashtra, which Hero Motors had acquired from US-based component maker Delphi in 2008. It has invested a further Rs4.6 crore at the two plants. ZF Hero Chassis Systems would invest Rs80 crore over the next two years to set up two new plants at Gurgaon and Chennai with a capacity to assemble 2.9 lakh units of chassis and axle systems in order to cater to the northern and southern markets. The production facilities at Halol and Talegaon, which have an annual installed capacity for assembling 1.6-lakh units of chassis and axle systems, are already supplying front corner module and rear axle assemblies to General Motors India for all its car models. "The excellent reputation and market expertise of the Hero Group and the owner family Munjal pave us the way to the Indian automotive market," said Hans-Georg Hrter, CEO of ZF-Lemforder. "In the joint venture will bring the ZF technology expertise and our extensive expertise to bear in chassis technology," he added. "The joint venture is to offer ZF chassis technology to local costs for the Indian passenger car market," said Dr. Peter Holdmann, managing director responsible for the Achssystemgeschft the ZF Car Chassis Technology Division. "Our long-lived, robust and resource-conserving products are recognized by customers worldwide - in association with Hero Motors, we can at competitive prices for small to compact cars for the Indian market to develop and produce. To realise this ideal, we will establish its own development issues in support of the joint venture in India. In addition, we opened new opportunities to work with Hero, "said Holdmann.

2010/03/02ZF

enters joint venture with Hero Motors Ltd. of India

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Joint venture secures access to small car market in India ZF acquires 50 percent of Hero Chassis Systems and including plants in Halol and Talegaon Joint venture supplies car chassis technology to car makers in Indian growth market

Friedrichshafen/New Delhi, India. ZF and Hero Motors Ltd. today signed a contract establishing the joint-venture enterprise ZF Hero Chassis Systems, securing access for ZF to Indias booming market for small cars. The automotive industry supplier is acquiring fifty percent of Hero Chassis Systems including two assembly plants in Halol, around 300 miles north of Mumbai, and in Talegaon, near Pune. Initially, some 100 employees will be engaged in the assembly of car axles for General Motors.

ZF CEO Hans-Georg Hrter explains the reasoning behind the partnership: The excellent reputation and market expertise of the Hero Group and the owning family Munjal will smooth our access into the Indian automotive market. Our contribution to the joint venture will be ZFs technological expertise and our broad know-how in chassis design.

The Hero Group has been active in the motorbike market for years and, through its subsidiary, Hero Honda Motors Ltd., is the worlds largest motorcycle manufacturer. As part of its portfolio, Hero Motors Ltd. provides engineering services for the automotive industry, including development and design, and also produces chassis components, including axle systems. As a result of the ZF Hero Chassis Systems joint venture, ZF now has a 50-percent share of this axle systems business.

Peter Holdmann, Head of the Chassis Systems Strategic Business Unit of the Car Chassis Technology Division and in charge of ZF axle system business activities, explains: The aim of the joint venture is to enable us to offer ZF chassis technology to the Indian car market at local costs. Our durable, rugged, resource-saving products are recognized by customers around the world. The tie-up with Hero Motors will allow us to design and produce them at marketable prices for models ranging from mini to compact for the Indian market. To accomplish this to an optimal degree, we will be establishing our own development operations in India to support the joint venture. In addition, collaborating with Hero will open up new opportunities for us to start manufacturing high added-value pressed sheet metal components for small-vehicle axle systems ourselves, Holdmann continued, after signing the contract on behalf of ZF in New Delhi. The Hero Group was represented by company director Pankaj Munjal.

German auto spare parts group ZF ties up with Hero Motors

March 03, 2010

On Tuesday, 2nd March, German auto spare parts group ZF and India's Hero Motors signed a contract establishing the joint-venture enterprise ZF Hero Chassis Systems, securing access for ZF to India s booming market for small cars. The German automotive industry supplier is acquiring 50 percent of Hero Chassis Systems, including two assembly plants in Halol, around 300 miles north of Mumbai, and in Talegaon, near Pune. Initially, some 100 employees will be engaged in the assembly of car axles for General Motors. ZF is one of the world's leading automotive industry suppliers specialising in driveline and chassis technologies. With a workforce of 60,000 employees, the company operates 125 plants in 26 countries. ZF ranks as one of the top-10 automotive industry suppliers worldwide. Explaining the reason behind the partnership, ZF CEO Hans-Georg Hrter said, The excellent reputation and market

expertise of the Hero Group and the owning family Munjal will smoothen our access into the Indian automotive market. Our contribution to the joint venture will be ZF s technological expertise and our broad know-how in chassis design.

The Hero Group has been active in the motorbike market for years and, through its subsidiary, Hero Honda Motors Ltd., is the world s largest motorcycle manufacturer. As part of its portfolio, Hero Motors Ltd. provides engineering services for the automotive industry, including development and design, and also produces chassis components, including axle systems. As a result of the ZF Hero Chassis Systems joint venture, ZF now has a 50 percent share of this axle systems business. Peter Holdmann, Head of the Chassis Systems Strategic Business Unit of the Car Chassis Technology Division and in charge of ZF axle system business activities, explains, The aim of the joint venture is to enable us to offer ZF chassis technology to the Indian car market at local costs. Our durable, rugged, resource-saving products are recognised by customers around the world. The tie-up with Hero Motors will allow us to design and produce them at marketable prices for models ranging from mini to compact for the Indian market. To accomplish this to an optimal degree, we will be establishing our own development operations in India to support the joint venture. In addition, collaborating with Hero will open up new opportunities for us to start manufacturing high addedvalue pressed sheet metal components for small-vehicle axle systems ourselves, Holdmann continued, after signing the contract on behalf of ZF in New Delhi. The Hero Group was represented by company director Pankaj Munjal.

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Hero Motors has announced that it is entering into an agreement with ZF Lemforder to form a joint venture called ZF Hero Chassis Systems Private Limited. ZF Lemforder is part of the German based Euro 12.5 billion ZF Group. The venture will mainly focus on the manufacture of chassis and axle. ZF is acquiring fifty percent, so both the companies will hold equal stake in the new venture. The venture will offer chassis and axle systems in a cost effective manner in order to get market share. The new price hike in the auto sector will be challenge but the companies expects to do well after Hero Motors got most of business for models from General Motors. The company already has two facilities in Gujarat and Maharastra and it plans to set up more plants in the next two years. The company will invest around Rs 80 crore in the next two years. The two new plants are expected to have an annual capacity of 2.9 lakh units of chassis and axle systems. The auto component has shown strong growth in few months as the auto sales in the country picked up. However, there are still signs of last year slowdown.