Initial investment in 100 car carriers proposed
Mahindra Logistics Ltd. (MLL), one of India’s leading third party logistics (3PL) service providers, has announced its partnership with Indian Vehicle Carriers Pvt. Ltd. (IVC), to be branded as 2×2 Logistics, aimed at launching assetized operations in out-bound automotive logistics. Mahindra Logistics will have a majority stake in 2×2 Logistics, which will initially invest in 100 specially-designed car carriers to serve automobile and two-wheeler OEMs.
This partnership will allow MLL and IVC to further develop and expand their transportation networks, linking the north, west, south and east clusters of production and consumption of automobiles.
“This is the first time we will be significantly assetizing our business by investing in 100 car carriers to begin with, and then ramping up capacity. It will help strengthen our operating capabilities in automotive logistics, our largest target industry vertical, with a clear focus on technology, quality and corporate governance. Forming such partnerships with our business associates will be an important part of our growth and success,” says Mr. Pirojshaw Sarkari, CEO, Mahindra Logistics.
“As OEMs expand their product lines in India, we see a significant potential for car carriers which are specially designed to meet a variety of needs, both in terms of dimensions of the vehicles being carried and special handling requirements. We will have a very specific focus on design innovation in car carriers in 2×2 Logistics. We are already one of the largest automotive logistics service providers in India, and this joint venture will allow us to directly operate assets and serve our customers with a greater degree of predictability and control,” explains Mr. Sushil Rathi, Senior VP, Mahindra Logistics.
Mr. KS Singhal, Founder & Owner, Indian Vehicle Carriers, says: “This is a proud moment for all of us as this JV has the potential to change the landscape of the Indian automobile logistics industry. Having been in the automotive logistics industry for more than 30 years, I can say without doubt that this new entity will have all the capabilities to become a one-stop solution for outbound logistics. We hope to leverage each other’s strengths and offer the highest level of quality and service to our customers.”
Mr. Parag Shah, Managing Partner, Mahindra Partners, has stated: “Our objective at Mahindra Partners is to nurture and grow the businesses of tomorrow. We follow a unique model of fostering innovation, creative business models and mutually beneficial partnerships. 2×2 Logistics will allow MLL to build a significant asset base and enhance its pan-India transportation network, leading us that much closer to an IPO by 2017.”
MLL has been aggressively expanding its business with a focus on multiple industry verticals. In August, it acquired a majority stake in Lords Freight (India) Pvt. Ltd. soon after private equity (PE) firm Kedaara Capital bought a significant minority stake for Rs. 200 crores in the logistics company.
