"Allison Transmission to Invest Over $100 Million to Double Chennai Facility as Global Demand Surges"

Allison Transmission Inc., the U.S.-based manufacturer known for its automatic transmissions for commercial and military vehicles, has signed a formal agreement with the Tamil Nadu government to expand its Chennai manufacturing facility. The new investment, estimated at over $100 million, is aimed at meeting the rising global demand for Allison's on-highway transmission products.

Tamil Nadu’s Minister for Industries, Investment Promotion, and Commerce, TRB Rajaa, confirmed the deal via a tweet: “Allison Transmission has signed an MoU with Guidance Tamil Nadu to expand its advanced manufacturing facility in Chennai. This expansion represents a major reinvestment of $92 million (₹763 crore) starting in 2025, creating 167 new direct and indirect jobs.”

Initially announced on October 24, 2024, the expansion will double the Chennai facility’s footprint, increasing production capacity and bolstering operational flexibility. David S. Graziosi, Chair & CEO of Allison Transmission Holdings, Inc., highlighted during the company’s recent earnings call that the $100-million-plus investment will be rolled out over several years, with nearly half of it allocated for 2025. The new facility is expected to commence operations in 2026, reaching full production by 2027.

Allison’s Oragadam facility near Chennai, established in 2010, currently serves as the regional headquarters and produces 1000 and 2000 Series transmissions for the on-highway market. In the latest expansion, Allison plans to enhance its fabrication capabilities to produce 3000 and 4000 Series transmissions, catering to regional demand.

Additionally, Allison has collaborated with Ashok Leyland, one of India’s leading commercial vehicle manufacturers, to bring fully automatic transmission technology to low-floor city buses. These new 12-meter diesel buses, powered by Allison’s Torqmatic Series transmissions, improve accessibility for passengers with disabilities, marking a significant step for the southern Indian public transportation sector.

HBL