Have you ever seen an Ambassador car? That would be a dim-witted question, right? But may be few years down the line we may not see the car on our roads. The car is regarded as India’s traditional official vehicle. But, these days we hardly see our ministers using the Ambassadors. Thankfully, to boost the company’s spirits, the Ambassador has been chosen as the official car to ferry athletes around at the October Commonwealth Games.

Not long ago did we hear that losses at Hindustan Motors, maker of the Ambassador car, were swelling. These losses are certainly raising questions about the company’s survival. What do you think will be the fate of Hindustan Motors?

The pug-nosed Ambassador was once upon a time the king on India’s potholed roads. But in the last fiscal year, Hindustan Motors is reported to have suffered losses of around Rs. 42.9 Crore from Rs. 37.8 Crore the previous year. To add to the misfortune, India’s oldest automaker said its net worth has dropped by more than 50 per cent. The car maker must now report to the state-run Board for Industrial and Financial Reconstruction which is part of India’s socialist-style bureaucracy that oversees revival of sick or financially troubled companies.

However, we are happy to see the company stay so positive. It insists that the future appears brighter, helped by an improving viewpoint for sales which had seen a financial decline recently. The company has not reached the state of bankruptcy. But with Hindustan Motors’ shares tumbling, analysts don’t have long-term hopes for the company. While car makers like Maruti Suzuki are doubling their profits in the fast-growing auto industry, it is sad to see Hindustan Motors suffer the losses.

Hindustan Motors, flagship company of the CK Birla Group, joined forces with Japan’s Mitsubishi Motors in the 1990s to manufacture Lancer sedans and the Pajero. The company could still never make it like the olden times of the 1970s when the Amby held a market stranglehold of around 70 per cent. The Ambassador started losing its name fame when sleek new cars entered India making the Ambassador’s chubby contours look old-fashioned.

The Ambassador may see a rebound in demand, with sales expected to double to 1,000 units a month in the coming year, but this represents just a fraction of India’s total annual car market of 1.53 million units. For years the Ambassador was the only car driven by senior government officials and people always knew when something significant was happening in the national capital because of the fleet of Ambassadors outside.

But now, most of the civil servants have abandoned the Ambassador in favour of more muscular sedans or SUVs. They are usually ferried around in armoured BMW cars. Even taxi drivers were loyal buyers of the Ambassador. But now, even their tastes have changed and they prefer the more fuel-efficient compact cars. They feel the hatchbacks are cheaper to run, more reliable and easier to drive.