Hindustan Motors has recorded a loss of Rs. 11.25 crores in the period of April – September 2015. This comes after a total net loss of Rs. 41.90 crores for the year 2014-15.
Hindustan Motors is India’s oldest car manufacturer. It was started during the pre-independence era in Gujarat and later shifted its base to Uttarpara in West Bengal in 1948. Here it started manufacturing of the iconic Ambassador. The car which was once a mainstream vehicle and leaded car sales right up to the 1980s in the Indian market, finally ceased production in 2014.
The company has recently recorded a loss of Rs. 11.25 crores for the period of April – September 2015. The total loss for the company till March 2015 was recorded to be Rs. 201.01 crores against its share capital of Rs. 104.41 crores, where the current liabilities exceed the current assets by Rs. 73.66 crores.
The company stopped the production of the Ambassador last year. The company mentioned worsening conditions at their plant with low production, growing indiscipline (as seen back in 1994 during the joint venture with GM causing the failure of the Opel Astra), lack of demand for its Ambassador and large collection of liabilities. The company declared itself as a sick unit to the Board of Industrial and Financial Reconstruction (BIFR).
The automaker also suspended its productions at the Uttarpara plant on 24th May last year, while starting lay-offs at its Pithampura plant from 4th December of last year. The company mentioned its concerns regarding its condition as signs of uncertainty about its ability to continue. HM announced a Voluntary Retirement Scheme (VRS) for all its permanent employees from the second quarter, whose results will be declared in the next quarter.