At 38, Dheeraj G Hinduja is, perhaps, the youngest to don the role of Chairman of the commercial vehicle maker headquartered in Chennai. In a competitive world, however, piloting the flagship Hinduja venture is not going to be any less easy for this third generation member of the Hinduja family. Yet, with men of eminence and experience surrounding him, Mr. Hinduja, the newly anointed Chairman of Ashok Leyland, is confident of driving the firm to top 10 in the international commercial vehicle arena. As he opened up to an informal chat with select presspersons here last week, the young Chairman had dropped enough hints to suggest that he would pursue a mix of aggression and caution to secure Ashok Leyland a visible place in the global market. After all, as he himself conceded, Ashok Leyland ``has given the family entry into big time global market.''
As he fielded a range of questions with aplomb, Mr. Hinduja exuded a sense of clarity in thought, sincerity of purpose and a blinkered horse-like focus.
Bets on bus segment
Mr. Hinduja said he was keen on taking Ashok Leyland to the top 10 in the commercial vehicle space and top 5 in the bus segment over the next five years. The company, he said, would look at overseas opportunities for mergers and acquisitions, especially in the bus space. In this context, he said Ashok Leyland would look at those markets which were easy to penetrate and also those markets that required the company to be closer to the customers there. “We look at acquisitions either for presence in new geography or for technology,'' he said. A combination of factors ranging from its frugal engineering capabilities to technology advantages and cost effective production methods, he said, would keep Ashok Leyland in good stead while pursuing its global ambition. Both Mr. Hinduja and Mr. R Seshasayee, Managing Director, asserted that Ashok Leyland was actively pursuing a bus strategy which would have global presence. “There are extremely good bus markets outside India.
Countries such as Latin America and West Africa are the potential markets for us. We will look at small bus companies with sizable customer base for possible acquisitions or put up brownfield plants in these countries. We will also look at casting/foundries and design/drawing technology companies for possible acquisitions,” Mr. Seshasayee said. The Managing Director said India was advantageously positioned to get into leadership position globally in the bus space. “Ashok Leyland has all the required capabilities (such as engines, telematics, electronics, safety systems, CNG and low-entry vehicles) to offer customised solutions in these overseas bus markets. We have huge scope in these countries and will pursue the bus strategy aggressively,” the Managing Director added. Asked to explain it further, he said that Ashok Leyland's approach would focus on introducing multiple products in different segments in different geographies. The ability to provide customised and cost-effective solutions would put Ashok Leyland in a stronger position in global bus space, he added. ``Countries like Latin America will need products similar to that of India,” Mr. Seshasayee said. Ashok Leyland has assembly plants in the UAE and holds 26 per cent stake in the U.K-based Optare, one of the leading bus makers. “We feel lot more confident about acquisitions in the bus segment,'' Mr. Hinduja said. Already, Ashok Leyland was exporting buses to SAARC countries, West Asia and some African nations, he said.
To a question, Mr. Hinduja said: “Our objective is to become one of the top 10 global manufacturers in commercial vehicles above 7.5-tonne category and one of the global top 5 in the bus segment. In the next five years, the volume should be around 150,000 in trucks and 40,000 in buses.”
On the domestic medium and heavy commercial vehicle segment, Mr. Hinduja said the segment was overcrowded at the moment. “Given our technology and new truck platform — U Trucks — we are confident that we will continue to perform well and try to be ahead of others,'' Mr. Hinduja said.
Venture with Nissan
Mr. Hinduja was confident that Ashok Leyland and its joint venture partner Nissan would have no difficulty in taking on the competition in the LCV (light commercial vehicle) segment in India. “We will start rolling out our products from our Hosur plant initially (expected in May 2011). Based on demand/volume growth, the company will set up a greenfield project,” he added. Mr. Seshasayee said there had been some delay in acquiring the land due to litigations. ``We expect to possess the land at Oragadam (near Chennai) shortly. The volume growth will really dictate the speeding up of our greenfield project," he added.
On the much-written about alliance with Nissan for small car, Mr. Hinduja said, “we are not averse to passenger car. However, we are not running after it. Small car, however, is a challenging segment. We are not in the space. So, we are not really pushing. We are not giving any extra thought to it. If any strong proposal comes from any potential partner, we will look at it.”
On his elevation to the top slot in Ashok Leyland, Mr. Hinduja said, “I am not new to Ashok Leyland. I have been with the company for quite some years as director and co-chairman. There is no change at the management level. The existing team at ALL, led by Mr. Seshasayee, will continue to look after the day-to-day operations. My role is to put the company on the global map through mergers and acquisitions, devise strategic direction, develop a strong leadership and nurse the talent pool within the organisation.”
Quizzed if taking over the chairmanship at such a young age was an advantage or disadvantage to the company, Mr. Hinduja said many multi-billion dollar American companies were run by persons in their mid-20s. “I have been working in Ashok Leyland for long,'' he said.
To a question, the Chairman said the Hindujas had not divested at any point in Ashok Leyland even while bringing in foreign partners. “Our family has taken a firm decision that at no point of time we will look for divestment of our equity to bring in any global OEM (original equipment manufacturer),'' he said. ``Our family will keep investing in core segments as and when required. We are happy to consider any alliances or partnerships in the segments where we are not present,'' he went on to add.
K. T. JAGANNATHAN
A combination of factors ranging from frugal engineering capabilities to technology advantages would keep Ashok Leyland in good stead