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Truck maker Ashok Leyland to give car venture a second shot

Ashok Leyland, the Chennai-based truck and bus maker, has not given up on its maiden passenger vehicle venture, despite poor sales. Its multi-seater Stile van saw sales of only 311 units in the April 2014-January 2015 period, less than half the same period of the previous year, when it was 694 units.

This is the first time India’s second largest heavy truck maker has plunged into the personal vehicle segment, with no prior experience.

The company has said in the past that it will restrict itself to the Stile and not go further in the latter segment.

Leyland had piggy-backed on Japanese giant Nissan, with the van built on the same Nissan platform that makes the Evalia. The latter is targeted at the personal vehicle segment but the Stile primarily targets the taxi segment, though it is also used as a personal vehicle. Gopal Mahadevan, chief financial officer, Ashok Leyland, said, “We have deeply realised that fact that we have not done well (with the Stile). It is the only product in our portfolio where we had a challenge. We are looking at having a relaunch, bringing it back with some renewed vigour.”

One reason the Stile has not done well is distribution strategy. The company set up retail outlets for the Stile within its existing truck showrooms, most of which are outside city limits.

The van segment produces annual volumes of about 125,000 units, with growth being 19 per cent yearly, according to the Society of Indian Automobile Manufacturers. Maruti Suzuki has 92 per cent in this segment, followed by Mahindra & Mahindra and Tata Motors.