Ashok Leyland (NSE: ASHOKLEY, BSE: 500477) is a commercial vehicle manufacturing company based in Chennai, India.

The company was established in 1948 as Ashok Motors, with an aim to assemble Austin cars. Manufacturing of commercial vehicles was started in 1955 with equity contribution from Leyland Motors. Today the Company is the flagship of the Hinduja Group, an England-based transnational conglomerate. In 1948, Ashok Motors was set up in what was then Madras (now Chennai), for the assembly of Austin Cars. The Company's destiny and name changed soon with equity participation by British Leyland and Ashok Leyland commenced manufacture of commercial vehicles in 1955. Early products included the Leyland Comet bus chassis, which sold in large numbers to many operators, including Hyderabad Road Transport, Ahmedabad Municipality, Travancore State Transport, Bombay State Transport and Delhi Road Transport Authority. By 1963 the Comet was operated by every State Transport undertaking in India, and over 8,000 were in service. The Comet was soon joined in production by a version of the Leyland Tiger. In 1968 production of the Leyland Titan ceased in Britain, but was restarted by Ashok Leyland in India. The Titan PD3 chassis was modified, and a five speed heavy duty constant-mesh gearbox utilized, together with the Ashok Leyland version of the O.680 engine. The Ashok Leyland Titan was very successful, and continued in production for many years. Ashok Leyland vehicles have built a reputation for reliability and ruggedness. The 500,000 vehicles being put on the roads have considerably eased the additional pressure placed on road transportation in independent India. In the populous Indian metros, four out of the five State Transport Undertaking (STU) buses come from Ashok Leyland. Some of them like the double-decker and vestibule buses are unique models from Ashok Leyland, tailor-made for high-density routes. In 1987, the overseas holding by Land Rover Leyland International Holdings Limited (LRLIH) was taken over by a joint venture between the Hinduja Group, the Non-Resident Indian transnational group and IVECO Fiat SpA, part of the Fiat Group and Europe's leading truck manufacturer. In the journey towards global standards of quality, Ashok Leyland reached a major milestone in 1993 when it became the first in India's automobile history to win the ISO 9002 certification. The more comprehensive ISO 9001 certification came in 1994, QS 9000 in 1998 and ISO 14001 certification for all vehicle manufacturing units in 2002. In 2006. Ashok Leyland became the first auto company in India to receive the TS16949 Corporate Certification. Ashok Leyland is a technology leader in the commercial vehicles sector of India. Its annual turnover exceeds USD 1 billion. Selling close to around 83,000 medium and heavy vehicles each year, Ashok Leyland is India's largest exporter of medium and heavy duty trucks out of India. It is also one of the largest Private Sector Employers in India - with about 12,000 employees working in 6 factories and offices spread over the length and breadth of India. The company recently acquired Czech-based Avia's Truck Business Unit, since renamed Avia Ashok Leyland Motors s.r.o. This gives Ashok Leyland a foothold in the highly competitive European Truck market. The Hinduja Group also recently bought out IVECO's indirect stake in Ashok Leyland for an undisclosed amount. Thus Ashok Leyland is now purely a Hinduja Group Company.

Current direction
The company has increased its rated capacity to 84,000 vehicles per annum. Also further investment plans including putting up two new plants - one in North India and one in middle east Asia are fast afoot. After expansion, the company shall attempt to dominate the medium- and heavy-duty commercial vehicles market in India. The company is actively considering and has made plans to enter the second hemisphere markets like Africa and Middle East. It has already a sizable presence in African Countries like Nigeria, Ghana, Egypt and South Africa. Additionally, Ashok Leyland is looking to expand its production operations overseas to make it a more global company. To assist in this goal, the company is looking to acquire small- to medium-sized commercial vehicles manufacturers in China and other developing countries which have an established product line. Last year, the company acquired Czech-based Avia's truck business. The newly acquired company has been named Avia Ashok Leyland Motors s.r.o.

BUSINESS DESCRIPTION Ashok Leyland is one of India's large manufacturers of commercial vehicles. It also manufactures special vehicles and engines for industrial, genset and marine requirements. The company has six manufacturing plants - the principal unit at Ennore near Chennai supported by a frame unit at Ambattur, two plants at Hosur, an assembly plant at Alwar, Bhandara and a castings plant at Hyderabad. Its main export markets are in ASEAN countries such as Bangladesh, Sri Lanka, Mauritius and the Middle East. Ashok Leyland operates through five subsidiaries: Lanka Ashok Leyland, Automotive Coaches & Components, Leyland Finance, Ennore Foundries and Ashok Leyland Project Services. Lanka Ashok Leyland is a joint venture between Ashok Leyland and the government of Sri Lanka. Ashok Leyland supplies chassis in both completely built-up and knocked down conditions to Lanka Ashok Leyland, which in turn assembles the chassis and builds bodies and sells them in the local market. Lanka Ashok Leyland has also established a subsidiary called Lanka Ashok Leyland Services, which takes care of marketing and after-sales service including sale of spares. Another group company is Automotive Coaches & Components. This has two divisions: the ACCL division and the PL Haulwel Trailers division. ACCL is the largest tipper body manufacturer in the organized sector in India, with its plant at Gummidipoondi, Tamil Nadu. Apart from tipper bodies, ACCL manufactures front end structures, container trailers and car carriers. The PL Haulwel Trailers division manufactures a wide variety of after-chassis products, including fifth wheel couplers and hoists; semi trailers - flat beds; container trailers; and ladle carriers for foundries. Leyland Finance is a large non-banking finance company, which focuses on hire purchase and lease finance of automobiles and construction equipment. It has the largest network of branches among nonbanking finance companies in India, with about 140 locations spread across the country. Ennore Foundries is a major automotive jobbing foundry, which makes gray iron and aluminum gravity die castings for automobiles, compressors, industrial engines, power generators and tractors, as well as for defense and marine applications. Ashok Leyland Project Services spearheads the project development activities of the group in India.

Apart from assisting the investment entities of the group, ALPS also provides professional services to help international companies interested in projects in India. COMPANY OVERVIEW For the fiscal year ended March 2004, the company generated revenues of $769.1 million, an increase of 36.7% on the previous year. The company saw a net income of $43.9 million during fiscal 2004, an increase of 73.8% on fiscal 2003. Company Background Ashok Leyland Ltd (ALL) was initially known as Ashok Motors. With participation from British Leyland in 1954, it was renamed Ashok Leyland. In 1987, the Hinduja group took over controlling stake from Rover. It is based in Chennai and is the second largest truck and bus manufacturer in India. Business profile The company is in the business of manufacturing commercial vehicles (CV). The company also manufactures vehicles for defense & special applications and engines for industrial; genset, marine requirements and automobile spare parts. It also makes double-decker buses in India. The major part of the revenues comes from the M&HCV segment. Industry scenario The CV industry is a cyclical industry and its growth mainly depends on industrial growth, road infrastructure development and the share of roads in total transport. Restrictions on overloading, legislation on age-old vehicles, emphasis on mass transportation, retail financing, environment and safety regulations among others also influence demand for CVs. Railways and other modes of transport are competition for this industry. However, road transport is preferred because of convenience and flexibility. The share of roads in total transport was around 65% in 2002-03 and is expected to be around 70% by 2007-08. Major Achievements of Hinduja Group In 1993, became first Indian Auto Company to receive ISO 9002 certification. Received ISO 9001 certification in 1994, QS 9000 in 1998, and ISO 14001 certification for all vehicle manufacturing units in 2002. Became the first Indian auto company to receive the latest ISO/TS 16949 Corporate Certification (in July 2006). First company to introduce full air brakes, power steering and rear engine busses in India. For over five decades, Ashok Leyland has been the technology leader in India's commercial vehicle industry, moulding the country's commercial vehicle profile by introducing technologies and product ideas that have gone on to become industry norms. From 18 seater to 82 seater double-decker buses, from 7.5 tonne to 49 tonne in haulage vehicles, from numerous special application vehicles to diesel engines for industrial, marine and genset applications, Ashok Leyland offers a wide range of products. Energy Policy We at Ashok Leyland are committed to conserve Electrical Energy through a Comprehensive Energy Policy and a Proactive Approach in Planning and Executing our Manufacturing and Service Activities. Towards this objective our energy policy is conserve electrical energy by optimizing its To usage through scientific methods. To focus on Global energy conservation methods like Capacity Utilization, Fine Tuning and Technology up gradation. To create an awareness of energy conservation at

all levels and encouraging them to take part in the conservation program. To monitor continuously through a better energy management system. Customer relation We believe that our impressive strides in the marketplace stem in equal parts from our proactive approach and our customers' unstinting support, earned the only way we know: by giving our customers the most appropriate transport solutions for each of their applications, and by backing them up with consultancy, finance, driver training and a responsive aftermarket network. We are conscious of the fact that vehicles are more than just a means of transporting people and goods; we understand that they have a deep and far-reaching impact on society, the national economy and the environment. We have, therefore, always endeavoured to engineer products and systems that promote progress on all these fronts. We firmly believe that this honest approach will make the Ashok Leyland marquee the symbol of the very best in transportation, today and tomorrow.
Company Profile: Ticker: Exchanges: 2007 Sales: Major Industry: Sub Industry: Country: Employees: ASHL OTH 71,682,000,000 Automotive Truck & Trailer Manufacturers INDIA 12125 Ashok Leyland Limited

Automotive industry The automotive industry is the industry involved in the design, development, manufacture, marketing, and sale of motor vehicles. In 2006, more than 69 million motor vehicles, including cars and commercial vehicles were produced worldwide.[1] In 2006 16 million new automobiles were sold in the USA, 15 million in Western Europe, 7 million in China [2] and one million in India.[citation needed] In 2007 the markets in Canada, USA, Western Europe and Japan are stagnating, while those in South America (especially Brazil) and Asia (South Korea and India) are growing. Ashok Leyland, a leading automobile giant, manufactures state-of-the-art vehicles for commercial, defence and special projects. This includes 7.5 RLW to 145 RLW vehicles for goods transportation. Ashok Leyland vehicles have established a reputation for ruggedness, reliability and superior performance. What are the key factors for an organization, (you feel) to be successful across the world? One of the most successful "invasions" in the post-Second World War era has been that of Japanese companies in the American market. They had two strong motive impulses: a national mission to redeem the pride suffered at the World War and a very limited domestic market. These organisations reflected the characteristics of a nation unified by the defeat, unified also by shared values. The organisations had

the self-confidence not to abandon their management and manufacturing systems, which they had perfected. Their competitive advantage was the resultant efficiency which made their products good value propositions. The products were different and answered latent needs of foreign markets. In fact, they transformed the market. The success formula stays the same in the current low tariff regime: firstly, there should be a strong urge - both need and mission - to succeed. This should be backed by global competencies in technology, manufacture, management and customer servicing, with distinct competitive advantage in at least one of these. The robust forays made by Indian IT companies in foreign markets validate this premise. Attracted by ready and remunerative foreign markets, these companies - young, confident and ambitious - entered into foreign markets. All of them have a huge competitive advantage in one quintessential factor, namely, high caliber and low cost human resource. What are the roles played by the external and internal environment to build world class competitiveness? A clear distinction has to be drawn between knowledge-based industries and others. The traditional industries operate in an environment with greater dependence on various external factors. In knowledge industries, the essential factors of competitiveness are more company-dependent. The capabilities that make up the competencies are individual rather than collective. Within this major difference, the external factors range from government policies, cost of finance, availability of infrastructure, competition and the state of the domestic market. How mature the domestic market is will determine the ability and readiness of the organization to service a foreign market. In industry segments barring a few exceptions like automobiles, the dominant domestic market segments are not in the same stage of evolution as most global markets. Irrespective of the industry segment, export orientation would presuppose organisational leadership that has the vision to look beyond national boundaries and set up recci missions even as they fight battles in the domestic market. An organizational culture of learning and daring is an equally important precondition. What do you feel had made other comparable economies, namely China and Japan successful? Japan was en early mover in international markets. They perfected their own brand of mass manufacturing systems and shop floor practices, lot of it reflective of the Japanese psyche which is so different from the Western or Indian psyche. Geographical and size proximity make India and China two seemingly comparable countries. I am afraid the comparisons end there. In India, the four decades of political and individual freedom followed centuries of foreign rule and as a national we have not learned to take the responsibility that comes with freedom. Starting the early 90s, we introduced economic freedom - in small and slow doses, given the need for debate and consensus. China's case is different. China has always been insular and homogenous. After decades of Party authoritarianism, China is attempting economic deregulation. Given the iron grip of the Party / government on macro economic factors, their initial steps have been at a faster pace. Not hamstrung so far by individual liberties, China has started off well with 7~8% GDP growth. Lest we forget, India, too, had three euphoric post-liberalisation years. China's experiments with globalization are too nascent to be called a success. The real test will come when the Party is forced to loosen its direct control over the economy (and that of the army over its citizens) and simultaneously the social cost of globalization, following China's entry into WTO, manifests itself in China. By tackling poverty more efficiently through absolute centralisation of power, China has bought more time for itself, though.

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It will take an unprecedented degree of political will to implement economic reforms in India. The leadership has to overcome the pressures of coalition politics and electoral compulsions. What makes the task more difficult in India are our poverty levels and the woefully inadequate social security system. We do not have the luxury of time to solve the latter and then attempt the former - we have to work on both simultaneously. India also has to sort out its dilemma between free market economics and socialism. We cannot travel in two boats for long. Once this is sorted out, then Government can pursue consistent, predictable polities without contradictions. We will do well to dismantle multiplicity of regulatory authorities and multiple taxation. More than anything else, we need a national mission.

What is your opinion regarding strengths that can be leveraged by Indian managers and organizations to build world class competitiveness? Globalization has brought international competition to the Indian market, so Indian companies have a chance to see at close quarters, the very same competition they will face outside India. Other than this, Indian companies start with disadvantages of a protectionist, socialistic past. India's best chance in global markets are clearly in knowledge industries. The disadvantages of traditional Indian industries in terms of high cost of capital and inadequate infrastructure are not an issue for them. And the decades of political and individual freedom that we have enjoyed as a nation suddenly becomes an advantage in the knowledge industries. Comment on the impact of Global Economic Environment & other issues like WTO on India and its trade scenario. It is well recognised that the only way by which global economy can grow in a sustainable fashion is through the expansion of international trade. Indeed in the last decade, international trade has grown faster than global economy and has contributed to significantly through the growth of individual countries. India has no option but to conform to and strengthen the rule based predictable multilateral system in the form of WTO. Without going into the complex issues relating to the various agreements on the WTO, one key issue that needs to be borne in mind is that external competition and external reform cannot succeed without internal competition and internal reforms. WTO could be one strong reason why we need to hasten with internal reasons. Indian entrepreneurship is globally competitive and given the environment in which the spirit of entrepreneurship is not shackled in any manner and there is no reason why India cannot compete successfully in the world markets and achieve accelerated growth of economy led by growth in international trade. Comment on the steps taken by Ashok Leyland to bring in World Class Competitiveness. We have always invested in evolving technology appropriate to the market, in order to offer better value to the customer and thereby create and retain a competitive advantage. The industry's subsequent acceptance of these new technologies as norms and the ongoing gains in our market share are only confirmative corollaries of this strategy. In the early 90s, in anticipation of economic reforms, we set global benchmarks of product and process technologies and quality standards. Accordingly, we have secured technology tie-ups with global technology leaders and put the organization and the systems through assessments for a series of international quality norms. Our make or buy decisions have been guided by maximisation of value addition. We chose for ourselves the route of technology driven growth. During the slowdown of the mid-90s, we concentrated on enhancing our internal efficiencies. Our initial focus area was materials,

which constitute close to 70% of our product cost. The processes covering the entire supply chain have since been rationalized, aided by IT connectivity covering vendors, manufacturing units, sales and marketing office, warehouses and dealerships. We have always been a learning organization given the complexities of technology. The learning culture has been further intensified. Simultaneously, the HR systems have been strengthened to facilitate performance management along with quite few people intensive processes, which have heightened employee participation in the efficiency improvement programmes. Express your view on how Indian companies can enhance their competitiveness to match other successful MNCs? Most Indian companies have a long distance to go before they level up on product quality, productivity and internal efficiencies. In process industries where productivity and quality are built into the equipment, we have intrinsic advantage, but the caveat is that they are capital intensive. In mass production through assembly operations, we are comparatively weaker due to poor shop floor management. Good shop floor practices can come only if we can attract good managerial material and make the carrot and stick combination work at the shop floor. India's best chance in the manufacturing sector lies in leveraging its natural resources. Industries based on minerals and agri-products will have a competitive advantage. Restructuring, size rationalization and technological self-sufficiency apart, there are at least three areas where Indian companies can learn from the success of MNCs. One reason for the success of MNCs is that they are market driven. The second distinguishing feature is that they are long term players. The third factor is one of size. Whether we like it or not - and more than egos will be hurt - consolidation is the key. Consolidation within the domestic industry and in some cases transnational alliances.