Tesla has not been in touch with us: Leyland top man

  Chennai: Commercial vehicle major Ashok Leyland reported a revenue of Rs 29,055 crore and a net profit of Rs 1,983 crore for the financial year 2018-19. The company posted a 10.8 per cent EBITDA margin for FY19.

The firm announced the results at an event held here in the city on Friday and also addressed issues about joining hands with Tesla, industry degrowth and rise in production costs.

Director of Ashok Leyland, Gopal Mahadevan, said, “While the total industry volume went down by four per cent, Ashok Leyland’s market share grew by 1.8 per cent. We did a very smart increase in the share of business.”

The CFO stated that LCVs’ performance in terms of volume and profitability hiked. “The LCV business has been and will be very crucial for us in Indian and foreign markets. Especially when exploring the foreign market such as Africa and South-East Asia, LCVs provide the edge over MHCVs as the sales and the serviceability becomes much easier. With project phoenix bringing in new variants to the LCVs, the best of the LCV business is yet to come,” he said.

“Although the shift from BS3 to BS4, GST, demonetisation and axle norm lined up to put a dent on the industry, it has been persistent in growing and so has Ashok Leyland. Our digital initiatives have helped reduce the down-time of a vehicle, putting us far ahead in competition of what other manufacturers are doing,” Gopal stated.

With reports of the CV maker and Elon Musk’s Tesla joining hands going around, chairman, Dheeraj Hinduja, jumped in to clear the air. “We are not looking at any collaboration on cars and nor has Tesla been in touch with us. Electric vehicle technology, which are untested waters in Leyland, is evolving very fast and we are happy to have discussions with people who have experience in that sector. We are just evaluating the opportunities.”

The firm believes the launch of its new left-hand drive product will increase its international sales.

Although the raw material i.e. steel and iron prices shooting up, Hinduja says that there are cost reduction initiatives taken within the company to ensure that the price hike will not hamper the growth in the following FY. He is expectant of the launch of BS6 engine tech by the April 2020 or by the end next FY, ‘BS6 along with the new LCV and modular programs will be our areas of investment.’

“On the Defence Front, we have won about 13 tenders. With the election results out, we await the orders to come through anytime soon,” said the chairman.

He added that the market in UAE, the elections in Bangladesh, the bombings in Sri Lanka led to a substantial decline in profitability of foreign MHCV sales and he is hopeful of a growth in MHCV sales and foreign operation in the upcoming FY.

In numbers
Ashok Leyland had earlier reported a seven per cent increase in total sales at 13,626 units in April this year. The company had sold 12,677 units during the same month last year, the CV maker said in a statement.

Sales of medium and heavy commercial vehicles in April grew by four per cent to 9,346 units as against 8,968 units in the year-ago month.

Sales of light commercial vehicles increased by 15 per cent to 4,280 units in April from 3,709 units in the corresponding month last year.

In the domestic market, the company sold a total of 13,141 units in the month as against 11,951 units in the same period last year, a growth of 10 per cent.

NT Bureau