I’m a little behind on news, sorry (we’ll catch up tonight), but this certainly caught my eye today:
Remember how LML was preparing for a February comeback? We all knew that wouldn’t happen, and it didn’t. But at today’s LML annual general meeting, LML director Deepak Singhania announced that LML will restart production by next month (whatever that means in India time), for the export market only. Here are some exerpts from the India Business Standard story (their links are unpredictable). Remember this is the LML Star/Genuine Stella/Retroscooter Belladonna, etc., that we’re talking about here.
â€¦Deepak Singhania, chairman and managing director of the company, said the company had received substantial orders for the export of scooters and intended to recommence operations by next month. Further, he said the company was also in discussion with certain organisations for financial/strategic partnershipâ€¦
â€¦Singhania told Business Standard: â€œWe are the only one manufacturing two-stroke scooters in the world. Neither Bajaj nor Piaggio is making that anymore. There is worldwide demand for these scooters. Besides we will make three-wheelers, again only for export. We will move out of domestic marketing.â€?
â€¦a perusal of the annual report shows a daunting task is ahead of the LML management. It has shown a loss of Rs 168.89 crore for the 18-month period from March 2005 to September 30. In the earlier period, the company sold 190,561 two-wheelers and in the period March 2005 to September 2006 it sold 111,083 two-wheelers. However, its exports were at 34,879 units as against 19,969 units in the previous financial year. Vehicles were exported to 36 countries, including the US and EU countriesâ€¦
LML knows what we’ve known all along, the international 2-stroke geared Vespa-style scooter market will never go away, and it’s all theirs if they can get their act together. It’s a good strategy, but a very big “if.” The Financial Times story (editorializing just a little) insists that the strike/lockout was a symptom of LML’s problems rather than a cause. Even if the workers are paid, a contract is agreed upon, and production starts as planned, LML appears to have serious management issues and financial needs that won’t solve themselves.