Hayes Lemmerz Subsidiary Expanding in India

Hayes Lemmerz International, Inc. has strengthened its market position in India and bolstered export capabilities following the completion of expansion work on its Indian subsidiary’s steel wheel production facility. The Kalyani Lemmerz Limited factory is located in the city of Pune, approximately 100 miles from Mumbai, and following recent expansion work it possesses an annual capacity of 800,000 units. Kalyani Lemmerz intends to add a further 200,000 units of capacity during 2007 through an additional US$10 million investment.

According to a Hayes Lemmerz announcement the Indian subsidiary is also constructing a new $15 million plant for the production of passenger car steel wheels. The plant will be located adjacent to its existing commercial vehicle steel wheel facility at the Pune site and is expected to begin production in October 2008. The new manufacturing facility’s anticipated output will be 2,000,000 steel wheels per year, with the ability to increase production capacity to 4,000,000 units in the future.

The inauguration of the completed extensions to the commercial wheel plant and a ground breaking ceremony for the passenger car steel wheel facility took place at Kalyani Lemmerz on February 23, 2007. Speakers at the ceremony included Mr. Fred Bentley, Chief Operating Office and President of Hayes Lemmerz’ Global Wheel Group, Mr. B.N. Kalyani, Chairman and Managing Director of the Kalyani Group, and Mr. John Stephenson, Vice President of Steel Wheel Operations for Hayes Lemmerz’ international wheel facilities.

“The expansion, both in commercial and passenger car steel wheels, strengthens our presence in the fast-growing India market and also enables us to support our customers around the globe,” said Mr. Bentley. With six carmakers, including Volkswagen, Renault and General Motors establishing manufacturing bases within a 30-mile radius of the Kalyani Lemmerz plant in Pune, Mr. Bentley believes his company is in the right place at the right time. “Automotive companies are about to take-off,” he commented. “When they come to India they are looking to work with people they have dealt with and use technology they trust. As they grow and enter new markets, they like somebody familiar to go with them.”

Hayes Lemmerz International Inc owns an 85 per cent share in Kalyani Lemmerz, with the remaining 15 per cent held by the Kalyani group. Baba Kalyani, chairman and managing director of Bharat Forge Ltd, has previously stated that the group would continue to hold its 15 per cent stake in Lemmerz but had no plans to alter this arrangement. Kalyani expressed hope that the company’s turnover would reach the $100 million mark following the expansion of commercial vehicle wheel capacity and the passenger wheel manufacturing facility entering production.