Hindustan Motors has sold the Ambassador to French auto giant Peugeot for just Rs.80 crore.
The Ambassador brand of cars was once the pride of the country. The official car of those in power corridors, the car fell out of favour in the face of stiff competition from other national and international brands.
West Bengal-based Hindustan Motors had suspended the production of the iconic Ambassador in 2014. The company had cited falling production, lack of funds and demand, rise in liabilities among the reasons.
Hindustan Motors is a C.K. Birla group firm and is India’s oldest car maker.
According to reports, HM said that an agreement with Peugeot SA has been executed and that everything including trademarks of Ambassador have been sold.
With the Ambassador, the PSA aims to re-enter the Indian market. Reports say that the French automobile maker has already appropriated around Rs.700 crore for a vehicle and powertrain manufacturing plant in Tamil Nadu. The manufacturing set-up will be in partnership with HM.
Around 1,00,000 vehicles per year will be produced.
PSA had previously partnered with Premier to manufacture the PAL series of cars. Following the debacle of that JV, the French maker has been struggling to find a footing in India.
Hope this time they succeed in not only finding a place in India’s growing auto market but also revive the Ambassador in a new avatar.