Down the memory lane

Calcutta, July 11: It’s curtains for Contessa — the Hindustan Motor sedan that guzzled enough money and gas to scare away buyers looking for zippy fuel-savers.

The C. K. Birla group flagship will slam brakes on the car’s production at its Uttarpara plant in a June decision that takes effect from this month. Contessa sales, dwindling over the past several years, plunged to such a point that only 40-50 cars were rolling out every year.

The death-rattle for Contessa has been sounded at a time when Hindustan Motors is gearing up to give Ambassador — its flagship model — a sales-spurring makeover.

To raise money for the initiative, the company is considering the possibility of converting some of its idle assets into working capital.

“We need nearly Rs 50-60 crore for the Ambassador upgrade. We would like to modernise the interiors of Amby and spruce up the features. The exterior will, however, remain the way it is as it’s the car’s USP. We may try to use some of our idle assets as working capital for the exercise,” Ashwani Dubey, executive vice-president of HM, told The Telegraph.

He refused to say how money would be raised this way. “The matter is being currently discussed and it will be premature to comment on it. But we are clear about our goal of becoming a low-cost manufacturer in future.”

The company aims at raising car sales in the current fiscal. Last year, it sold 12,000 Ambassador cars and 1,000 trekkers. “This year, our target is to sell 18,000 Ambassador cars and 2,000 trekkers,” added Dubey.

An earlier plan to manufacture rural transport vehicles at the Uttarpara factory has been shelved. Its production will remain confined to the Pitampur plant near Indore.

In signs of a change in tack, Hindustan Motors is focusing on component manufacturing.

“We want to expand the business in the current financial year, and see a turnover of Rs 100 crore from it. We are already supplying spares to General Motors, railways and others,” he said.

Dubey, who joined the company only 10 days back, has the task of turning around a company stuck in the red for the past six years. “We need to pay our suppliers. So we have to work out a strategy which generate revenues and helps us return to the path of profit.”

After-sales service, too, is on the top of the agenda. A 24-hour service station is now working in Chennai and there are plans to spread it across the country in an effort to help Ambassador owners and taxi operators.

A high-performance award was kicked off recently for customers who adopt remarkably high standards in maintenance and driving for their Ambassador cars.