Hindustan Motors sells Ambassador brand to Peugeot for Rs 80 cr
Citing poor demand and lack of funds, Hindustan Motors had already suspended production of the car since May 2014.
CK Birla-controlled Hindustan Motors Ltd, maker of the iconic Ambassador car, has sold the ‘Ambassador’ brand to French carmaker Peugeot for Rs 80 crore.
Citing poor demand and lack of funds, Hindustan Motors had already suspended production of the car since May 2014. In the 1980s, 24,000 units of the car were sold every year, whereas the annual sales dropped down to an average of 6,000 units in the 2000s.
“Hindustan Motors has executed an agreement with Peugeot SA for the sale of the Ambassador brand, including the trademarks, for a consideration of Rs 80 crore,” Hindustan Motors on Friday said in a regulatory filing.
According to Press Trust of India report, the PSA Group had, in January 2017, inked a partnership with the CK Birla group to re-enter the Indian market and earmarked an initial investment of 100 million euros (around Rs 700 crore) to set up vehicle and powertrain manufacturing in Tamil Nadu. The tie-up entails two joint venture agreements between the companies of the two groups.
The report said the initial manufacturing capacity will be set at about 1,00,000 vehicles per year and followed by incremental investment to support a progressive ramp-up of the long-term project.
The CK Birla group is better known for the now discontinued iconic Ambassador car that was manufactured by group firm Hindustan Motors.