Indian, Finnish Partners Eye HPDC Project

Investment may exceed $125 million in automotive, telecom venture

July 16, 2007 — Ashok Leyland, an Indian automotive and commercial vehicle manufacturer, has formed a joint venture with Finnish diecaster Alteams Group to manufacture high-pressure aluminum diecastings for automotive and telecom applications. Each partner will hold 50% of the venture, which they say will draw synergies from Ashok Leyland’s automotive experience and Alteams’ know-how for HPDC and insights into telecommunications product design.

The first phase of the project will begin this year, with construction of an estimated $43.5 million manufacturing plant at Tamil Nadu, to produce telecommunications components as early as next year. It will also supply a portion of Ashok Leyland's requirements for engine and gearbox castings. The second phase of the venture will be completed in the next five to six years, with investment totaling an estimated $83.3 million, to produce HPDC components for passenger cars and non-automotive parts, in India and elsewhere.

According to R. Seshasaye, managing director of Ashok Leyland, “Apart from a fusion of the respective strengths of both the partners, the JV reflects the expansion of Ashok Leyland Group’s presence in the auto components sector to take advantage of rapidly growing opportunities both in India and abroad.” Ashok Leyland is the parent company of India's Ennore Foundries, but Seshasayee emphasized that the venture will broaden its portfolio into products for the automotive and telecommunications markets.

CEO Panu Rotila stated the new venture "notably strengthens Alteams’ opportunities to serve clients in Asia. We are very happy to be able to start co-operation specifically with Ashok Leyland. A JV with such an important player in the automotive industry boosts our expertise.”

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