Ashok Leyland breaks its silence


It has taken the country’s second-largest commercial vehicle maker 60 years to shed its reticence. Apart from a high profile brand campaign, the makeover also involves a series of product rollouts

M S Dhoni, all 100 meters of him, welcomes you to the 10-storeyed glass-fronted Ashok Leyland (ALL) headquarters on Chennai’s Sardar Patel Road. In fact, India’s Captain Cool is everywhere in the swanky office – inside lifts and outside work stations. The posters of a smiling Dhoni doing Namaste are the country’s second largest commercial vehicle manufacturer’s (turnover: Rs 12,841 crore) way of breaking its silence.

Alok Saraogi, ALL’s head, brand and marketing communications, agrees the company has been “shy” in the past. “But we have now decided to be more market-facing as we look to scale new markets and segments,” he adds. Saraogi is walking the talk, which explains the company’s decision to launch what is its second brand campaign in 60 years. The first one was a more sedate affair – a brief campaign featuring a father who brings a truck-shaped cake on his son’s birthday. That was six years ago.

Industry observers say the latest brand makeover efforts are in response to competition. It may be a coincidence that Dhoni’s brand ambassadorship was announced the same day ALL said that its market share in 2011-12 has dropped to 23 per cent from 26 per cent a year ago. That’s not all. ALL’s net profit declined over 13 per cent year-on-year to Rs 258.73 crore in the March 2012 quarter. Besides, its sales were up just 8.4 per cent, which is less than the average increase of 10 per cent over the last three years.

Besides, experts say ALL has to keep doing new things as it is more vulnerable than its competitors. Since it deals purely in commercial vehicles, it is more dependent on macroeconomic factors than peers such as Tata Motors or Mahindra and Mahindra who also sell cars and two-wheelers.

ALL begs to differ. Managing Director Vinod Dasari says the national campaign featuring Dhoni is a part of the company’s drive for transformation. In fact, in April 2012, ALL’s market share increased to 27.5 per cent as compared to 26.3 per cent during the same period last year, Dasari adds.

One of the main objectives of the campaign is to tell the world that ALL is a South-headquartered company with national ambitions and not a “South Indian company”. The company, which has a stronghold in southern markets, now wants to be aggressive in the northern and eastern regions. “Cricket is a national religion and Dhoni is a reigning deity. That makes the advertisement nationally relevant,” Saraogi says.

Dasari agrees. However, he knows that putting Dhoni near the trucks on television alone will not sell the products. What is required is greater focus on customer — fleet owners, drivers and mechanics who are all part of the new campaign.

The campaign seems to have been timed well as it comes just ahead of ALL’s new set of rollouts in the medium and heavy commercial vehicles space. ALL is planning to launch a new range of products including the Jan Bus, the world’s first single-step, front engine fully flat floor bus. Besides, the company will also bring Avia’s cabins during the second half of this financial year, which will be rolled out from its Pantnagar plant. The company has entered the construction equipment sector along with American major John Deere.

ALL is also betting big on its light commercial vehicle product, Dost, which was developed along with its Japanese partner Nissan last year and marked the company’s entry into the robustly growing segment. “We are very happy to see the performance of Dost,” says Dasari. The company sold 7,760 units of Dost last year, helping it clock 29 per cent market share in the markets (Tamil Nadu, Karnataka, Kerala, Andhra Pradesh, Maharashtra, Gujarat and Rajasthan) where it was launched and 16.6 per cent nationwide market share in 2-3.5T segment.

“We are seeing good response for the product and our backlog is three months now, so we have to increase our production capacity from 100 units a day to 150 units”. The company has set a target to sell 36,000 LCVs in the next fiscal. ALL-Nissan is also planning a greenfield facility, near Chennai.

Several other small changes are also being made. For example, earlier, ALL’s chassis were driven all the way to the body building shop from the factory, which means the tyres and batteries went through a lot of wear and tear. Now the chassis are mounted on a trailer and sent to the body shops. So, the tyres and batteries are not used and the customer gets a brand new vehicle in the true sense.

So as per ALL’s new idiom: the stadium is all dressed up, the players are out in the field and the match is about to begin.