Tata Motors to up capacity at Pantnagar plant

Tata Motors is looking up the capacity of its Pantnagar plant to produce medium and heavy commercial vehicles, reports CNBC-TV18's Ronojoy Banerjee.The decision to increase capacity comes after the recent revival that has been seen in CV sales and analysts expect sales to increase further as economic activity revises.Tata Motors will also get a subsidy benefit from Uttarakhand government, as under a central scheme, companies recieve a 15 percent subsidy on their capital investments.A bulk of the company's MHCV production currently takes place at its Jamshedpur and Lucknow plants but shifting a significant part of the production to Uttarakhan would help it cut on costs and pass on higher discounts on its products.The strategy was followed by rival Ashok Leyland after it started a plant in the state five years ago.When contacted, Tata Motors said it continued to "evaluate suited locations for new, existing products" and was "working closely with regulatory authorities and government stakeholders for necessary support".It added that it started production of MHCV trucks in Pantnagar nearly a year ago and that there was "no substantial drop in production at Jamshedpur and Lucknow".