CHENNAI, December 12: Meritor Automotive Inc is planning to pump in $30 million into Automotive Axles Ltd, a joint venture with the Kalyani group, over the next five years.

Prakash Mulchandani, president of Meritor's worldwide truck and trailer systems said on Wednesday that India would be a key area in terms of investments. Meritor is also investing $12 million in China.

Automotive Axles manufactures rear axle aggregates, including commercial vehicle brake systems for Ashok Leyland, Telco and Daewoo Motors. Since Meritor is a supplier for Iveco (which gives the knowhow to Ashok Leyland for its range of vehicles)the company realised the importance of being able to supply directly to Leyland.

Although the truck industry is not doing well as of now, Ashok Leyland's chairman RJ Shahaney said the bearish phase was temporary and the company would go ahead with its expansion plans as announced earlier. Consequently, Automotive Axles will also expand the capacity from 36,000 axles to 80,000 axles and from 260,000 brakes to 400,000 brakes.

Meritor, one of the largest supplier of truck axles, trailer axles, truck brake systems in the heavy commercial vehicles, also supplies to Volvo and Renault overseas. The company is also planning to negotiate for supplies with them in India, which will be done through Automotive Axles.

Meritor has acquired another company in Bangalore - Autarky Auto Products India Ltd - which is currently manufacturing window regulators. However, Meritor will diversify its product range, either through existing ventures or through new subsidiaries.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.