Last year was good for Daewoo
By Venkatachari Jagannathan | 14 Apr 2000
For the year ended March 2000, Daewoo Motors has sold 40,217 cars, comprising of Matiz (domestic 35,863 units -- exports 1,196 units) Cielo-3,158 units.
Apart from export of cars to Italy, Egypt and Sri Lanka, the company also exported 30,000 engines and gearboxes to Korea last year. "Our export target for the current year is 5,000 cars, engines and gear boxes each per month. And exports are made at a profit. Last year, our export revenue was around $80 million," Awasthi says.
1999-2000 has been really good for the company. And that has its natural impact (see Awasthi hits out at Hyundai India).
"Last year, we have made operating profits and this fiscal we will be breaking even," Awasthi hopes. . Daewoo Motors nearly tripled its turnover and is improving its market share. However, he refuses to give out relevant figures on the company's bottomline. "It is the interest cost and higher depreciation, which has resulted in the company showing a net loss," is all that he volunteers.
The company's total loan component is around Rs 2,400 crore, comprising of an external commercial borrowing to the tune of $400 million and foreign currency loans from Indian institutions amounting to $200 million.
With demand for Matiz going up and the car market growing by 50 per cent last fiscal, Daewoo Motors has started working in two shifts. The company will be scaling up its production to 6,000 units per month to little over 7,000 by June, and finally reach the level of 7,500 units by July.
On the whole, the company has planned to roll out nearly 70,000 units this fiscal. "The product mix will be 60,000 units of Matiz and the balance 10,000 would comprise of Cielo and Nexia," says Awasthi. This is apart from the new luxury car, which is being planned.
As regards the company's light commercial vehicles (LCVs), Awasthi says that the current production levels are just 10-15 units per month against a total capacity of 18,000 units. It may be recalled that the LCV plant is the legacy of DCM Toyota Ltd.
Speaking about the rejig operations made by his parent company back home, Awasthi says that four companies -- General Motors, Ford, Fiat and Hyundai Motors -- have shown interest in acquiring or having alliance with Daewoo Motors.
After due diligence is over, two bidders will be shortlisted by June and one would be selected by July.
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