PIAGGIO GROUP OPERATIONS IN INDIA
Piaggio Group operations in India are conducted through Piaggio Vehicles Private Ltd. (PVPL), a wholly owned Piaggio subsidiary, which manufacturers Ape diesel-engine 3-wheelers in cargo and passenger transportation models.
The PVPL facility, located in Baramati (State of Maharashtra, near Mumbai), covers a total surface area of more than 120,000 m2 (including a covered area of 23,000 m2). The factory has further expanded production capacity by virtue of a success that has made Piaggio the second manufacturer on India’s important 3-wheeler market, with a share of around 33%, and the leading vendor of 3-wheelers for cargo requirements, with a 38% market share.
PVPL 3-wheeler vehicle shipments rose from approximately 35,000 in 2003 to 70,000 in 2004, and more than 100,000 in 2005.
Further significant growth was reported in 2006: from January to September, Piaggio Vehicles Private Ltd. shipped more than 101,000 vehicles and reported revenues of 142 million euro, for sales growth of 40% (on 72,000 shipments in January-September 2005), and revenue growth of +35.8% (104 million euro in the first nine months of 2005).
Production of Ape 3-wheelers in Baramati is now flanked by production of the Quargo four-wheeler commercial vehicle, a quadricycle based on the Piaggio Porter commercial minivan, to be known on the Indian market as the Ape Truk. The name capitalises on the outstanding success of the Ape and emphasises the 4-wheeler’s capacity and solidity.
Built on a 482 cc liquid-cooled diesel engine, with 5 gears, Ape Truk offers an 800 kg carrying capacity together with automobile-type driver cab and controls for greater user comfort; the vehicle architecture is an advanced 4-wheeler version of the Ape designed for easy handling.
The Baramati factory has already installed the chassis assembly/welding lines and final assembly lines for the new vehicle. With an additional potential output of 24,000 vehicles/year for the Ape Truk, Baramati will have an overall installed capacity of more than 150,000 vehicles/year on a two-shift basis.
The Piaggio Group’s expansion in India is not limited to vehicles but will soon also include engines: on 13 November 2006, the Piaggio & C. S.p.A. Board of Directors approved an important new industrial project in India, for the construction near the city of Pune (State of Maharashtra) of a new facility to produce new small- and medium-cylinder diesel engines. The plant will have a production capacity of 200,000 engines/year and is scheduled to begin operations between the end of 2009 and early 2010. The total investment, over the next three years, has been estimated at this preliminary stage at approximately 60-65 million euro.
The Piaggio Group’s operations in India today include a workforce at PVPL of more than 1,700 employees and a sales and service network comprising over 230 exclusive dealers. The level of demand on the Indian market allows PVPL to work on a “zero inventory” basis.
The Indian 3-wheeler market, where PVPL is a leading player, continues to expand at a healthy rate, with demand rising by 21.2% compared with the first 9 months of 2005. From January-September 2006, shipments to end users on the 3-wheeler market exceeded the 300,000 mark (all manufacturers) compared with approximately 250,000 in the year-earlier period.
Within the Indian 3-wheeler market, the Passenger vehicle segment (3 and 6 seats) reached a total of 177,000 shipments (+23.5%), while demand in the Cargo segment—where Piaggio is India’s leading vendor—maintained its previous significant growth rate to reach a total of 125,000 shipments.
February 2007
