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Volvo's India R&D centre develops trucks for world

Business Standard:  October 20, 2016

New Delhi: Bengaluru is gaining a distinct identity on the global map of Swedish bus and truck maker Volvo. About 800 engineers, mostly Indians, are busy developing a truck the company’s Bengaluru research & development (R&D) centre that will be sold only outside India.

India is the third biggest R&D centre for Volvo after Sweden and France in headcount. “We design global trucks in India. A lot of R&D work on truck technology is done here. We are very proud that India is involved in a big way there. Volvo also has an IT wing that has 1,500 people doing global IT work for the Volvo group. There is also an accounting team of 300-400 people,” said Kamal Bali, managing director, Volvo India. The R&D centre, started with 100 engineers seven years ago, can add 200 more.

Volvo India forms only four or five per cent of the group’s global revenue of $42 billion, but Bali said India is much more important than this turnover. The Indian R&D team has a global responsibility to develop value segment trucks. For any value truck that is to be designed or improved, the responsibility lies with the Indian team and the product will be owned by the Indian side.

“Concept to design to execution is done by the Indian team. Of course, they may take some help when it comes to engines. But, they are leading the show. Some of the products this team will do will never be sold in India,” said Bali.

The Indian centre has successfully developed the Pro 8000 heavy-duty truck platform that was also launched in India (with Volvo’s JV partner Eicher) and in Indonesia and Thailand a couple of years ago. The next mandate is medium duty truck (10-15 tonnes) exclusively for the overseas market. “It will go into production next year,” said Bali.

Bali said the group finds the product gap in its portfolio and decision is taken to develop new products. A particular centre is awarded the responsibility to develop a product based on competencies and past experiences.

Volvo, which produces trucks, buses and construction equipment, is looking to grow India revenue from $1.5 billion to $2 billion in next couple of years. “We are going to be aggressive. India is looking very bullish and all categories will grow in double digits for us. We want to improve market share and need to grow faster than the industry,” said Bali.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.