‘Wherever the government has provided incentives for the purchase of two-wheelers, three-wheelers, cars, buses, and trucks, it gets a push for most of these alternate fuels.’
Photograph: Kind courtesy Ashok Leyland/Instagram
Dheeraj Hinduja, who is set to complete 15 years as the chairman of Ashok Leyland, tells Shine Jacob/Business Standard in an interview in Chennai, about the company’s expectations from the new government, as he outlines the strategy in the light commercial vehicles (LCV) category and Switch Mobility funding.
Your goal is to enter the top 10 global CV manufacturers in the future. What will be the role of exports?
Around 15 years ago, we only had two buses that were our mainstay for exports.
Today, we have a strong portfolio, ranging from buses to trucks.
We never used to have left-hand drive trucks.
This strong product base allows us entry into several markets.
Today, the Gulf Cooperation Council has come to accept Ashok Leyland as a trusted brand.
I think the West Asian market remains strong. The SAARC market is reviving once again.
In Africa, although we are not present in 15 countries, it keeps oscillating.
We are looking to enter Indonesia, Malaysia, and the Philippines.
When we look at the vision, we are clear that when we come to the top 10, we know what we need to do, like the share in the domestic market in medium and heavy commercial vehicles, heavy commercial vehicles, and international operations.
We have more products lined up catering to international operations and are moving towards products for the West Asian and European markets.
Ashok Leyland is unveiling six launches in the LCV segment this year. What are the reasons for this push, when rural demand is not that high?
Till 2011, we were not in the LCV space.
Over the past 12 to 13 years, we have given a big push.
Our initial launches were in collaboration with Nissan.
Once we were comfortable with it, we realised that we need to invest on our own.
Once the collaboration with Nissan ended, we launched Bada Dost, which helped us boost our market share.
In the 2-3.5 tonne segment, we now have a market share of 20 per cent and there is a growth opportunity we are seeing in the distribution network with logistics and e-commerce companies.
Ashok Leyland launched e-LCVs in March. You have seen advance interest for 13,000 units from various companies.
How do you see the response you are getting?
It is only in April that we have sold around 60-80 vehicles.
The order book is continuing to grow. Whoever is testing the vehicle is giving a good response.
A disadvantage is that FAME subsidies were withdrawn.
The government is speaking about FAME III, if that comes back, then this will accelerate.
It has slowed down the push to the volumes.
Wherever the government has provided incentives for the purchase of two-wheelers, three-wheelers, cars, buses, and trucks, it gets a push for most of these alternate fuels.
Without it (incentives), people will not see the reason why they should do this.
From the automobile sector, what will be your wish list for the new government?
From the government side, the Society of Indian Automobile Manufacturers, and look at trucks as well.
Other automotive bodies are saying that when we are considering these incentives.
The incentives are predominantly for buses in the commercial vehicle segment space, and will be good if they can implement it in the truck segment as well.
You were looking for a strategic partner in Switch Mobility. What is the status?
The enthusiasm regarding electric vehicles is not prevalent on a global basis.
Even in the discussions that we were having, we did not feel that valuations were correct.
Today, Ashok Leyland is in a strong position with its financials.
We don’t feel it is necessary that we should be giving equity to anyone at a valuation that does not justify the right value.
We will continue to invest for the time being in Switch Mobility.
You are entering the 15th year as Ashok Leyland chairman. How do you look back at the journey so far?
I have been associated with Ashok Leyland for 30 years. But the growth is driven by the team.
Whether it is the subsequent managing directors who have been there, the greatest strength of Ashok Leyland more than its products is its team.
We have seen solid growth. From 2010-11, we started light commercial vehicles.
It was in 2007-08 that we started building our engines and have grown from strength to strength.
We have ramped up our product development capabilities, our network, the international operations, and have a clear vision on what we are driving towards.
The best thing is that it is no longer the board setting targets on the market share by the team.
When the team is driving it, I would say that the majority of the battle is won.
I think our penetration in the light commercial vehicles has been strong.
I believe that the best days for Ashok Leyland are yet to come.
What is your take on other alternate fuels like CNG, LNG, and Hydrogen?
They will be small in number. I am not seeing large volumes in this segment.
Feature Presentation: Aslam Hunani/Rediff.com
