Ashok Leyland stops producing commercial passenger vehicle

Company to write down its investment in the vehicle JV with Nissan by Rs 225 crore

Commercial vehicle major Ashok Leyland has decided to stop production of its manufacturing commercial passenger vehicle STILE. The product has been produced by the JV company, with Nissan. The company decided to write down its investment in the vehicle JV by around Rs 224.19 crore.

"We have stopped production, since the product was not successful. We will stick to only commercial vehicles," said Vinod K Dasari, managing director, Ashok Leyland, adding that in future if it see an opportunity in the space, the company will look into it.

Gopal Mahadevan, chief financial officer, Ashok Leyland said that in automobile industry, it is not new to withdraw the product if it is not doing well. He added the company had invested around Rs 500 crore in the joint venture, which was reduced by Rs 214 crore.

Dasari did not disclose number of STILe sold since it was launched in 2013 and current inventory levels.

Ashok Leyland has reported a six per cent drop in LCV sales overall in 2014-15, while it managed to gain market share to 16 per cent from 14 per cent last year. To strengthen the portfolio, Dasari said, variants of Dost will be launched.

According to an earlier press release, the company launched the STILE, a Multi-Purpose Vehicle (MPV), in the year 2013, to address various applications like 7-8 seater people transport in the urban and rural areas, hotel shuttles, taxi services, ambulances, panel vans, courier services, inter-city and intra-city travel.

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