Hindustan Motors' Struggle for Survival

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Case Details:

Case Code : BSTR021
Case Length : 10 Pages
Period : 1998 - 2002
Organization : Hindustan Motors
Pub Date : 2002
Teaching Note : Available
Countries : India
Industry : Automobiles and Automotive

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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The Road Ahead

The company's moves seemed to be finally bearing fruits as it was able to narrow down the losses in the first quarter of 2001-02 by around 30%.

HM was banking on the Ambassador's niche markets (government and taxi) and hoped to retain the segment by launching new variants. The Trekker was also poised to do well after the relaunch and HM hoped to sell 3,200 vehicles in 2001-02. Analysts however remained skeptical about HM's future prospects and its ability to make a turnaround as a passenger carmaker.

They felt that the only way out of HM was to turn itself into auto-component supplier to multi-nationals producing passenger cars in the country. HM on the other hand, seemed confident that with Pajero's launch in early 2002, it would regain its position in the Indian car market.

Exhibits

Exhibit I: Comparing Car Sales Figures
Exhibit II: Hindustan Motors - Sales Break-Up

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