Scania to close down in-house bus body unit production in Karnataka
Scania said the premium segment in bus business in India was very small and the numbers have not been sufficient to enable profitability.
June 05, 2018 / 10:18 PM IST
Scania -Low demand forced Volkswagen Group company Scania to shut down its bus body building in India in 2018. The company competed against Volvo in the premium bus space. Its trucks division however continues to operate (Image: Scania)
European premium bus manufacturer Scania on Tuesday said it has decided to close down its in-house production of bus bodies at Narasapura due to lack of demand in this sector in India.
"Due to lack of demand in the premium bus business in India, Scania is restructuring its bus manufacturing in India and is forced to close down its in-house production of bus bodies in the Narasapura premises," a company statement said.
Scania said the premium segment in bus business in India was very small and the numbers have not been sufficient to enable profitability. "The order book is slow," it said.
"We continue to have ready stock on the yard due to which it has become unviable to continue bus building operations at our Narasapura premises," it said.
However, the bus and truck chassis production would continue to stay in-house as before, it added. The company said it was optimistic about the long-term prospects in the Indian market and hoped there would be an uptick in demand for environment-friendly and high-performance buses.
The company said it would support its employees during this period of financial adversity and has offered severance scheme to all impacted employees.