The C.K. Birla Group has decided to sell the Ambassador brand (including trademark and certain related rights) to Peugeot SA for ₹80 crore raising hopes of a return of the iconic car on the roads.
The announcement, which came through a regulatory filing, brought cheer to past users who saw scope for a revival of the ‘Amby’ as the car was lovingly called, but also saddened others, who used social media to vent their anguish on the loss of a quintessential Indian brand.
Hindustan Motors Limited was incorporated at Port Okha in Gujarat as a small assembly plant for passenger cars in 1942.
Six years later, it shifted its activities to Uttarpara in West Bengal and set up facilities for the manufacture of cars and trucks.
For close to half a century, Ambassador ruled Indian roads transporting the ‘king and the commoner alike’ as consumers had hardly any choice. Liberalisation and the end of the licence-raj changed all that.
VRS - 2 rounds
Production was suspended at the Uttarpara unit in May 2014 citing a host of reasons including low productivity.
Most workers opted for Voluntary Retirement Schemes that HML brought out, through two rounds between November 2014 and January 2015) although some remain on its rolls and have stayed back at the township.
The company has been trying to revive the ailing unit by roping in joint venture partners.
However, nothing has worked out so far although the group has not given up hope. “We continue to explore opportunities with prospective partners for reinstating operations,” a company spokesperson said in response a query.
HML said that that the intention was to use the sale-proceeds for clearing dues of employees, lenders and other outstanding amounts.
The PSA group and the C.K. Birla Group had signed in January, joint venture agreements to produce and sell vehicles and components in India by 2020.
Accumulated losses
The JVs envisage manufacture of, assembly and distribution of PSA passenger cars and power trains in Tamil Nadu. The PSA group has three main brands: Peugeot, Citroen and DS. The C.K. Birla Group is engaged in automotives, heavy engineering, infrastructure building products, consumer durables and IT services. HML had accumulated losses of ₹233 crore until March end 2016, which had wiped off its share capital.
