Ashok Leyland, John Deere in 50:50 construction joint venture

Ashok Leyland, the flagship of the Hinduja Group has entered into a 50:50 joint venture with the US-based John Deere, the world's largest manufacturer of construction and engineering equipment.

This two companies will make and market construction equipment and the joint venture expects to commence production by early 2010 with an initial roll out of backhoes and four-wheel-drive loaders.

R Sashasayee, managing director, Ashok Leyland said "With this JV, we realise our foray into a new and adjacent vertical as part of Ashok Leyland's diversification plans. We see huge synergies between this business and our existing one of commercial vehicles in terms of aggregates, parts and distribution network. We are happy that in John Deere, we have a technology leader with an impressive portfolio of proven and popular products' to partner us in this venture.

John Deere, founded in 1837, manufactures construction and forestry products at a number of factories around the world and is distributed through a network of more than 600 dealer locations worldwide. It makes crawler dozers, crawler loaders, skid steers, backhoe loaders, forestry track feller bunchers and harvesters, knuckleboom loaders, winches and components for various heavy equipment products. The company acquired Timberjack in December 1999 that enabled it to increase the division's product line to more than 100 models.

Samuel R. Allen, president, worldwide construction and forestry division, John Deere, said, "In Ashok Leyland, we have found an ideal partner with a shared vision. This action enhances John Deere's growth of the construction equipment business outside of North America. India is an important market and Ashok Leyland is a knowledgeable partner with strengths in brand recognition, quality manufacturing, distribution and loyal dealerships.''

The range of products manufactured through this JV will subsequently be expanded to include a full line of construction equipment and the products will be exported to both Ashok Leyland and John Deere markets. The JV will build a manufacturing facility in India and is currently evaluating site locations.