Force Motors to Buy MAN Truck Plant in India

India’s Force Motors Ltd. has agreed to buy a heavy-duty commercial vehicle plant in Pithampur from former joint venture partner MAN Truck & Bus AG.

The deal, whose terms were not disclosed, is expected to be finalized by the end of October. MAN decided earlier this month to restructure its remaining operations in India as a regional research and development center.

MAN’s factory at Pithampur has assembled 25,000 vehicles over the past 12 years for the Indian, Asian and African markets. But the brand has remained a marginal player in a market dominated by India’s Tata Motors and Ashok Leyland.

MAN, now a part of Volkswagen AG, entered the India market for off-road, construction and special-duty commercial vehicles in 2003 through an alliance with Force Motors. But the 50:50 venture was disbanded in 2012 because of low sales volume. At the time, Force sold its stake in the venture to MAN for €150 million ($174 million).

Force Motors, whose sales dropped 6% to 31,000 vehicles in the fiscal year ended March 31, already operates a light commercial vehicle factory in Pithampur.