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Tata Motors gets nod to produce 'eco cars'

Honda, Suzuki and Volkswagen have also applied for the project. Thailand had already permitted Honda, Suzuki and Nissan to establish the car plants.
PTI | By HT Correspondent, New Delhi
UPDATED ON APR 03, 2008 07:11 PM IST

India's largest vehicle maker Tata Motors has received Thailand government's approval for setting up a greenfield facility to manufacture "eco cars" at an estimated investment of Rs 760-1,015 crore.

Thailand had invited investment from car makers for manufacturing environment-friendly cars and proposed to give tax benefits subject to certain conditions. Toyota and Mitsubishi too have received nod for similar facilities.

When contacted, Tata Motors spokesperson said Bangkok has approved the company's "green car" manufacturing facility but declined to share the investment details.

Sources, however, said investment would be in the range of 6-8 billion Baht (Rs 760-1,015 crore) as the minimum investment criterion is five billion Baht.

Among others who had applied for the project are Honda, Suzuki, Nissan and Volkswagen. Thailand had already permitted Honda, Suzuki and Nissan to establish eco car plants, ahead of the latest round of approval.

As per the criterion for setting up a facility to produce "eco cars", the vehicle should be with less than 1.4 litre engine and four out of the five engine components would have to be made indigenously there. Another condition for the project was to manufacture one lakh units in five years.

On the type of car that the company would manufacture in the country, Tata Motors (Thailand) Ltd Chief Executive Officer Ajit Venkataraman had said last week, "Both Nano and Indica fit into the criteria. And something in between may also come. It can be anything."

Most of the manufacturers would likely export the cars to the neighbouring countries in the region as the size of the passenger car market is two lakh units a year in Thailand.

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