COIMBATORE: Pricol, the Rs. 585-crore light engineering automotive component manufacturer, plans to set up a joint venture in Iran to make instrument clusters and speed sensors. Its Chairman and Managing Director, Vijay Mohan, told The Hindu here on Monday that the proposed project would be a 50:50 joint venture with Nava Khodro Plastic Company, which now marketed Pricol's instrument clusters and speed sensors in Iran.

Mr. Mohan said Pricol was now supplying about 20,000 instrument clusters and 30,000 speed sensors every month to Iran. About eight lakh cars were manufactured in Iran last year and this was expected to go up to 14 lakh in three years. Since there was a huge potential for instrument clusters and speed sensors, it was planned to establish an assembly plant in Iran.

The critical components would be supplied from India, the peripheral plastic and sheet metal components would be localised in Iran. The assembling plant was planned to be established by the end of 2007.

The total project cost was $8 million, to be invested in two years. The share capital towards the project cost would be $2.5 million and the balance would come through bank loan. Pricol's exports to Iran were $10 million annually. In three years, sales from the joint venture in Iran to the car manufacturers were expected to increase to a minimum of $30 million annually.

By assembling the products in Iran and also using localised components, the import duty into Iran would be less and the product cost would come down, he said.

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