MAN will look at a bigger India play in trucks and buses after buying out Force Motors' stake in the joint venture. This is inevitable with the current downtrend in Europe, which will see the BRIC (Brazil, Russia, India and China) economies take centre-stage for MAN in the coming years.

The acquisition of Force Motors's equity, coincidentally, comes barely a fortnight after Volkswagen assumed majority control in MAN worldwide with a 53.71% stake. Its holding in Swedish truck maker Scania (held by MAN) was also enhanced as a result to 62.6%.

Scania, incidentally, has already made known its intent to grow its India presence, which means that VW will look at greater integration of its commercial vehicle operations here. Whether this will include synergies on sourcing with its car business remains to be seen though this is not likely.

From MAN's point of view, being part of VW will mean joint efforts in R&D (along with Scania) and sharing growth experiences in emerging economies. This cooperation between the three entities is expected to result in synergies of at least EUR 200 million annually, largely in the procurement space.

Going forward, the trio could join hands in areas such as production and R&D. However, each of these brands will retain its exclusive identity, which is the case with other VW group companies in India like Audi and Skoda.

MAN is already a big player in Brazil where it is the leader in the five tonne plus segment. The competitors here include Daimler, Ford, Volvo, Iveco and Scania. In Russia, it has a new plant in St Petersburg and an assembly unit in Uzbekistan. It sells heavy trucks in China under the SITRAK brand.

As for India, observers believe MAN will have its task cut out especially when there are tough rivals to contend with. Apart from established players such as the TATA and Ashok Leyland, others like Navistar (in a partnership with Mahindra), Volvo (with Eicher) and Asia MotorWorks are keen on grabbing a larger share of the truck pie.

(Sourced from BL)