Hit by poor sales, Hinduja Group flagship company Ashok Leyland has suspended the production of its first passenger vehicle - Stile, and has written down the investments made in the joint venture with Japanese auto maker Nissan Motor Company by Rs 214 crore, a top official said.
Ashok Leyland had inked a joint venture with Nissan Motor Company to produce light commercial vehicle and passenger vehicles. Under the joint venture the company rolled out 'DOST' light commercial vehicle and 'Stile' in the passenger goods segment.
Ashok Leyland, Managing Director, Vinod K Dasari said the company had suspended production of Stile few months back and had written down the investments by Rs 214 crore.
"The total investments was Rs 500 crore in the joint venture made by Ashok Leyland. But, we have written it down by Rs 214 crore", he told reporters here.
To a query he said, "it (the vehicle) did not sell and the company had suspended production of the product three-four months months back".
Elaborating, Ashok Leyland, Chief Financial Officer, Gopal Mahadevan said, "We are just evaluating our options. We have decided to write down the value by Rs 214 crore in the investments made by Ashok Leyland".
Talking about the company's performance for the financial year ending March 31, 2015, Mahadevan said, the company's total sales volume increased by 28 per cent compared to the industry growth of 16 per cent for the year ending March 31, 2015".
"We have gained market share of 28.5 per cent in Medium and heavy commercial vehicle segment. Last (financial) year, our market share was 25.8 per cent. So we have actually grown by nearly 2.7 per cent in market share. That is huge growth.", he said.
