India's Motherson Sumi secures orders worth Rs 15,400 cr from Germany’s Daimler AG

Thursday, Apr 30, 2015

Auto components maker Motherson Sumi Systems Ltd (MSSL) has received biggest ever order from Germany’s Daimler, worth Rs 15,400 crore, to supply external and internal systems for Mercedes-Benz vehicles.

Samvardhana Motherson Automotive Systems Group BV (SMRP BV), a subsidiary of the company, has received a significant set of orders for the supply of a range of exterior and interior systems for several future Mercedes-Benz vehicle generations, MSSL said in a statement.

“MSSL estimates these orders to generate sales revenues of approximately Rs 15,400 crore (around euro 2.2 billion) over its lifetime and expects to commence from calendar year 2018,” it added.

In order to support Daimler’s expansion activities, MSSL will invest in two new plants, one each in the USA and Hungary which will enable SMRP BV to be closer to Daimler’s vehicle assembly plants, it said.

Besides, the move would help its capacity expansion in existing plants in Germany, as well as in new machines, tools and product development efforts, it added.

“While we can't give any specific details about these orders, but we can state that the preparatory work for the establishment of the two new plants has already begun,” MSSL Chairman Vivek  Chaand Sehgal said.

The company’s plant in Hungary will be located close to Daimler’s operations in Kecskemet, while the US facility would come up in the region around Tuscaloosa, close to Daimler's assembly plant. The company, however, did not disclose investment details for the new plants. MSSL offers a range of products in the fields of electrical distribution systems, plastic molding, elastomers processing, tooling, metal machining, automotive rear view mirrors and integrated modules

Motherson Sumi Systems shares were trading at Rs 479.05 apiece, up 3.24 per cent from previous  close on the BSE.