In June 2015, two leading automobile manufacturers with
skill sets of their own-- India-based Eicher and US-based Polaris --joined
hands to introduce Multix, India’s first personal utility vehicle,
purpose-built for the independent businessman. Even before the product could
establish itself in the country, both the companies announced in March 2018 that
its 50:50 joint venture company Eicher Polaris Pvt Ltd (EPPL) had passed a resolution to shut
operations with immediate effect.
So what went wrong? In an exclusive interview with Motown India, Pankaj Dubey, the former
Chief Executive Officer & Director, Eicher Polaris Pvt Ltd gave a plethora
of reasons for the failure of the Multix project. Besides, he said, “It was a
very painful decision for both of us whether it is Eicher or Polaris and it has
been even more painful for me as a CEO to do a closure of a company where we
had 500 people and so many vendors, dealers, etc. It was a very painful process.
We are still going through the closure. Most of the work is complete but I
would say that it was an innovation which was a great idea but somehow we got
stuck somewhere and that's how we had to close”.
Dubey pointed out that before the start of the project, the
US based company Polaris had done a lot of study of the Indian transportation
space to find a gap where no one was operating.
The rural areas with very bad road conditions created an ideal space for
an on-road version of a vehicle that could be built on an ATV platform.
“So the idea was brilliant and it was very well
appreciated by hundreds of customers who bought these vehicles. Around 3500
customers have bought these vehicles. They are still very happy with the kind
of an overall ride quality the vehicle gives,” he said.
But the business plan of the company was to sell in
hundreds of thousands (lakhs). “We were not able to reach the numbers and
therefore the company was losing lot of money and at the same time there were lot
of changes happening on the policy front around the time that we launched the
Multix. Demonetisation happened, the need to move from BSIII to BSIV came,
airbags became compulsory, then one had to shift quickly to BS VI norms, all
this triggered a lot of challenges for the company as the engine that the
company had chosen for the Multix was a very basic engine from Greeves and to
upgrade it even to BSIV was tough and then to go to BSVI with the same engine
was looking to be very tough.
“Then we had to do a lot of fresh investments to an
already loss making concern and then we were going into a space which was
almost like an automotive space,” he recalled. Thus a vehicle which was meant
to go into the rural areas to ply on bad roads so as to make life easier for
the small farmer or businessman, suddenly had to be upgraded to meet BSVI
norms, have airbags, meet side impact and front impact crash norm, etc
“Now incorporating all these changes meant making a fresh
huge investment to make the business continue after 2020 or after 2019 when all
the regulations would have come into play. But we were not able to meet the
business volumes which were projected initially when we set up the factories, so
both partners took a call and we decided to cease operations,” said Dubey.
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