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Nissan Motor Co. (NSANY) and Ashok Leyland Ltd. (500477.BY) will introduce three light truck models from summer 2011 as the two companies kick-start their alliance in the expanding Indian market.

Two of the models will be produced at Ashok Leyland's factory at Hosur in the southern state of Tamil Nadu, while the third will be manufactured at Nissan's factory near Chennai, also in Tamil Nadu.

The Nissan-Ashok Leyland combine is among several companies which are seeking to benefit from an expanding Indian economy and the government's move to strengthen the country's infrastructure. The growth potential has led auto makers such as Daimler AG, Volvo AB, Navistar International Corp. and MAN AG to either form alliances or directly sell their trucks and buses in India.

At the same time, local truck makers such as Tata Motors Ltd., Eicher Motors Ltd. and Mahindra & Mahindra Ltd. are revamping their product range.

Total truck and bus sales rose 38% in the fiscal year ended March 31 to 531,395 vehicles, according to the Society of Indian Automobile Manufacturers. Of this, light truck sales surged 45% to 251,916 units.

The trucks that the Ashok Leyland-Nissan joint venture plans to launch will have a load-carrying capacity of 5.0 tons-7.5 tons and will carry either the Ashok Leyland or the Nissan badge.

"This is an ambitious plan that will allow Ashok Leyland to expand its business at home and the other markets," Andy Palmer, Nissan's senior vice president, told a news conference Tuesday.

"It will also mark the entry of Nissan into the growing Indian light commercial vehicle market. A market that has enormous potential of growth," said Palmer, also the chairman of the joint venture, Ashok Leyland Nissan Vehicles Ltd.

The companies are also exploring export markets, Palmer said.

Nissan and Ashok Leyland, India's second-biggest truck maker by sales after Tata Motors, had planned to jointly invest $500 million to build a dedicated factory for light trucks at Chennai. But the plan was put on hold due to the global economic downturn, and the companies decided to use their existing factories to produce the vehicles.

Ashok Leyland, the flagship of the diversified Hinduja Group, owns a 51% stake in the joint venture to co-develop, manufacture and market light trucks for the Indian and overseas markets. Nissan holds the remaining.

The two companies also have an equally owned joint venture for research and development, while Nissan holds a majority 51% stake in a third joint venture with Ashok Leyland to build truck and bus engines and their transmissions.

Palmer said the three joint ventures will cater to the Indian market as well as other "cost-sensitive" markets with finished vehicles and also feed Nissan's production facilities worldwide with parts.

"We anticipate the volumes will rapidly ramp up," he said. "The capacity made available by the two partners in the first phase is 150,000 vehicles a year."

V. Sumantran, executive vice chairman of Hinduja Automotive Ltd., said the two companies are yet to decide the time frame on starting the dedicated factory for light trucks.

"It is clear to us that this is still Phase I...We are committed between the two parent companies to execute the Phase II to the full measure of the original joint venture and this means that we will move to the subsequent plant dedicated to light commercial vehicles," he said.

Sumantran said up to 95% of the parts for the light trucks will be sourced from Indian suppliers.

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