Hero Cycles Building 1 Million Unit Capacity Plant
LUDHIANA, India – The Indian bicycle major Hero Cycles is planning a rapid expansion in India. The company is building a new plant in the Central – Eastern State of Bihar. The investment in the new facility is close to INR 370 million (USD 6 million) with a capacity of 1 million bicycles per annum, expandable in future.
The plant is being set up to service India’s Eastern market which is showing high growth. The facility is expected to be operational by mid-2014 around May-June. “The plant is being built on a 10 acre plot along with ancillaries at a place called Binta about 35 km from the state Capital Patna.
Initially production is set at 1 million bicycles. “Later, after two to three years, capacity can be hiked by 50%,” said Sanjay Singh, Vice President, Project & Planning, Hero Cycles. The construction of the new Hero Cycles facility started last October 2013.
‘Near to the customer’
Bihar is a key market for Hero Cycles and annually it supplies around 1 million units to the state. “The plant would bring us near to the customer. Next to Bihar the new facility is to cater also for the bike market of Jharkhand,” said Singh. Bihar is around 1,400 kilometers from Ludhiana where Hero Cycles mother plant is located. The new facility is to curb transport costs. Production is mainly typically India Roadster bikes as well as more fancy models.
Hero Cycles may also export bicycles from the Bihar plant to the neighboring countries Bangladesh and Nepal. “We are looking into that opportunity of as both markets are relatively close,” said Singh.