Automobile Corporation of Goa Ltd. (ACGL), has started building the Tata – Hispano luxury bus at its facility in Goa. The new bus is based on the global design models of Spanish bus body builder Hispano acquired by Tata Motors a couple of years back. The Goa plant has a capacity to manufacture 25 buses a month. Already 50 of these buses have been built and delivered to customers in Karnataka, Andhra Pradesh and Maharashtra. Currently the chassis is being manufactured by Tata Motors and the bus body at the ACGL facility.
ACGL was established in 1980 as a joint venture between EDC, a Goa Government undertaking, and Tata Motors with the primary objective of aiding the economic development of Sattari, a backward area in Goa. While EDC on its part provided finance and infrastructure, Tata Motors, then Telco, agreed to provide technical and managerial assistance to the joint venture.
In 1988, the company identified bus body-building as an important area with considerable export potential and entered into technical collaboration with Fuji Heavy Industries, the Japanese bus coach manufacturer, to establish a facility within the vicinity of the Sheet Metal Division (SMD) factory in Sattari.
Mr. N.R. Menon, Managing Director of ACGL, says: “We have created capacity to manufacture over 10,000 buses per annum, which makes ACGL one of the largest manufacturers of bus bodies in the country”. ACGL now manufactures 16 to 20 buses every day.
In 2007-08 the company manufactured and sold nearly 3,600 buses, out of which 3,500 buses were exported. During the current year the company plans to manufacture about 6,000 buses out of which 4,000 are expected to be for exports and the balance will be for the domestic market. The company’s sale of buses is centered on exports through Tata Motors to markets in the Middle East and Africa. To de-risk the business from over-dependence on export markets, an action plan to aggressively sell buses in the domestic market has been drawn.
The Indian bus market is expected to witness significant growth in the coming years. The inter-city segment will continue to grow at 10 to 15% annually. Many Indian cities do not have any organized public transport system. This offers significant growth opportunity in the future. “Our target is to reach the annual volume of 10,000 buses by the end of 2010”, he says.
ACGL has two units in Goa. The first plant is a press shop and the second unit is for bus body-building. As part of the expansion plans, the main plant of Pressings Division in Goa, which is plant 1, has been partially converted into a bus body-building plant with the installation of a state-of-the-art paint shop. This plant currently has a capacity to build around 2,500 buses per year and will attain the full capacity of 5,000 buses once all the presses are shifted to a new location. This is the unit where the Tata Hispano luxury buses are being built.
Mr. Menon also said: “ACGL is now planning to set up a manufacturing facility in Dharwad, in Karnataka for pressing and stamping. Once this unit is established the pressing unit from plant 1 at Goa will be shifted to Dharwad and the plant 1 at Goa unit will be made into a fullfledged bus manufacturing unit. We also have an additional press shop facility in Pune. The annual turnover of the pressing unit is Rs. 90 crores per annum”, adds Mr. Menon.
To fund the expansion, ACGL went in for rights issue last year and mopped up Rs. 70 crores. This money is being spent on expansion of the existing facility and setting up of new facility in Dharwad. ACGL clocked turnover of Rs. 330 crores for the year 2007-08.
According to Mr. Menon, ACGL has been working on specific segments in the Indian domestic market, the tarmac coaches for airport applications and semi low floor buses for city applications. The tarmac coaches offered through Tata Motors have received a very encouraging response with every airline in the country ordering these buses during the year. All these new low-floor buses of Jet Airways, Kingfisher and other airlines are built by ACGL. More than 100 of these buses have been built in the last few years. The company has also built semi low floor city buses for cities like Indore, Nagpur, Jabalpur.
