Hindustan Motors sells Ambassador to Peugeot, could result in a new Ambassador

Hindustan Motors has sold the Ambassador for Rs 80 crore to French carmaker, Peugeot, an amount which will be used by the Indian company to clear salaries and dues

By: | Updated: February 11, 2017 11:05 AM
Image Source: Team-bhp Image Source: Team-bhp

Ambassador, the car brand that ferried around state officials for decades is now being sold to French company Peugeot (PSA). In case you're thinking that with all its legacy and iconic past, the Ambassador brand would've made a handsome buck for the CK Birla Group, you couldn't have been more wrong. The brand sold for a measly Rs 80 crore, an amount which will be used by the Indian company to clear salaries and dues, a company statement said.

Production of the Ambassador had ceased about three years back after the car's journey of more than seven decades. Ambassador started out as a Morris Oxford and was 'THE' car in India for any wealthy individual or a politician. The car was phenomenally successful till the Maruti Suzuki 800 came in, which was the start of Ambassador's downhill journey. Over the years, the Indian economy opened up and grew at a fast pace, raising the consumer expectations. While carmakers such as Maruti Suzuki and new foreign brands continued to innovate and offer new technologies to the consumer, Ambassador was stuck in its own time zone.

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Hindustan Motors did give it few upgrades to meet emission norms and some features too were added but they were too insignificant to arrest the decline of the brand. Eventually, Ambassador sales were limited only to taxi sales in West Bengal and at that time it was clear that sooner or later the brand would face the axe. With growing labour problems, the company decided to stop production in May, 2014, bringing an end to a car with a glorious history that spanned generation since independence right up to the superpower India that the world knows.

Right now Peugeot hasn't made any official comment on what it plans to do with the Ambassador brand but the company had recently signed an agreement with Hindustan Motors to manufacture Peugeot cars at the Indian company's Chennai plant. Hence, Peugeot could revive the Ambassador brand in India utilising one of its modern platforms to offer a car that offers modern technology while retaining the nostalgia of the brand. Whatever happens, any car that gets this combination right could be a success ticket for a company like Peugeot to enter a challenging market like India, which it has been trying to enter since quite a while.

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