With the top end of the commercial vehicle segment slowly picking up, Tata Engineering (Telco), the country’s largest truck manufacturer, is firming up plans to launch a 49-tonner vehicle, pitched against the higher end trucks of Swedish giant AB Volvo.

Telco is testing the vehicle and pricing details are being worked out. The company’s future plans include looking at power systems, alternate fuel or hybrids as a means of transportation, said Telco chairman Ratan Tata at the extraordinary general meeting in Mumbai today.

The economic downturn has driven down capacity utilisation with both the truck and Indica small car plants operating at around 50 per cent capacity. Mr. Tata felt the government’s infrastructural initiatives will help boost the truck industry and improve volumes. The better performance of the heavy vehicle segment will be sustained due to lower transportation costs on a per-tonne-kilometre basis, he said. Telco shareholders approved the company’s financial restructuring initiatives, which include writing off assets and expenses of Rs 1,180 crore against its securities premium account, there-by reducing its reserves and net worth.

The restructuring exercise consists of write-off of deferred revenue expenditure of Rs 933 crore, a write down of fixed assets aggregating Rs 215 crore and a write-off for dimunition in value of investments aggregating Rs 32 crore. The change in accounting policy and writing off product development expenses is being done a part of overall restructuring, Mr Tata said. Analysts believe it will improve the company’s return on equity. Telco’s board approved the proposal on February 20, ’02. The company will now seek a similar approval from the Bombay High Court.