Hero and Magneti Marelli join hands

With an eye on the future and to further strengthen its technical knowhow, Hero MotoCorp Ltd (HMCL) formed a joint venture with Milan based technical giant Magneti Marelli (MM). The new entity would be called HMC-MM Auto Ltd and is Hero’s first joint venture after splitting with its erstwhile partner Honda two years ago. The country’s largest two-wheeler manufacturer HMCL will hold majority stake of 60 per cent while Magneti Marelli will hold the rest 40 per cent. Both the company would invest $ 8.5 million over a three-year period and total investment would be to the tune of 27 million over the next 10-year period. 

Speaking about the joint venture, Pawan Munjal, Managing Director & Chief Executive Officer, Hero MotoCorp said, “The scope of this agreement is quite significant for Magneti Marelli as our partner in this JV is the world’s largest manufacturer of two-wheelers. The aim is to partner with Hero MotoCorp in order to equip with advanced Powertrain solutions all Hero motorcycles and scooters, and indeed most two-wheelers circulating in a country where current sales are already close to 15 million units per year.”

The main intention of this venture for Magneti Marelli is to help Hero MotoCorp in developing Electronic Fuel Injection (EFI) systems which would be used for fuelling in future generation of engines. Hero is investing in developing fuel injection systems so that it can meet the various emission standards of countries across the globe as it plans to expand its reach in foreign countries. Along with meeting stringent emission norms fuel injection also has other benefits like adapting to various climates, altitudes along with improved performance and fuel efficiency. Apart from fuelling system the joint venture would also develop Immobilisers, traction and slip control, multi map, flexi fuel and multi fuel management in the future. This partnership would make Hero to be the first Indian two-wheeler manufacturer to have EFI product line of its own.

Hero is also investing close to US$75 million in building the state-of-the-art Hero Global Innovation & Research & Design Centre which is projected to commence operations by the 1st quarter of 2015. And at this centre its current Research & Development (R&D)centres at Gurgaon and Dharuhera factories will be shifted. Also it has alliances with the US-based Erik Buell Racing (EBR) and Austria-based AVL to further enhance its in-house R&D capabilities and engine technologies along with Italian two-wheeler design firm “Engines Engineering” which would play a vital role in its future products. Also Read: Hero MotoCorp lays foundation for fourth plant & Global Parts Centre