Bajaj to cut down ULC car cost with its two and three wheeler parts

Bajaj Auto one of India's largest two wheeler manufacturer which is in process to launch a ultra low cost car model in India will manufacture this model using about 70% parts of its two wheeler and three wheeler from manufacturing unit. It is expected that because of using these parts the company will manage to cut down its expenses from Rs 1500 crore to Rs 200 to Rs 300 crore.

Earlier in year 2008 the Nissan-Mahindra Renault and Bajaj Auto jointly given a statement according to which all of these three company will jointly manufacturer an ultra low cost car in India. It was announced that in this joint venture these companies will manufacture about 4 lakh units of this ultra low cost car.

“There is excess capacity in the global car market. Our thinking was that if the ULC is a standalone project, it will be vulnerable to business cycles. We decided to derisk the project by leaning on our motorcycle and three-wheelers for its platform and aggregates. Around 70-80% of the internal components should be common,” said Mr Bajaj.

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