The Indian Hero Group and Daimler AG signed a contract in Delhi, India, that governs the establishment of the Daimler Hero Motor Corporation Ltd. commercial vehicle joint venture. Approval for the new company was issued by the Indian government in March 2008.
The Daimler Hero Motor Corp. will initially produce light-, medium-, and heavy-duty commercial vehicles for the Indian volume market under a new brand name. The search for a suitable production location is underway.
Once a decision is made, construction will begin on a plant that will start manufacturing commercial vehicles in 2010. The new company is aiming to achieve a localization rate of up to 80%. Production of commercial vehicles for export to other emerging markets will be launched at a later date.
Daimler and the Hero Group will invest $566.7 million in the German-Indian joint venture over the next five years, whereby Daimler will contribute $346 million in the form of foreign direct investment.