How a 29-Year-Old Took the Reins of a Automobile Startup and Built It into a Rs 120 Crore Turnover Company
When Ayush Lohia took charge as CEO of Lohia Auto Industries in 2008 at the age of 29, he was stepping into uncharted territory. Narayan Kumar Lohia, Ayush’s grandfather had started the family business in 1957 by making stainless steel lunch boxes and torches.
He had then diversified into manufacturing of brass and copper sheets. He started Designco, a handicrafts export company, and later forayed into the real estate and green energy sectors as his four sons and grandsons joined him in the business.
It was Narayan Kumar Lohia’s dream to get into automobile business and he entrusted the job with his grandson, Ayush, who had cut his teeth in the sales division of Designco and later in the stainless steel business that he himself set up.
Young Ayush was a great admirer of his grandfather and was up for the challenge. “This was Lohia group’s (Lohia Global) first ever B2C product, and we were pitted against established players like Bajaj and Honda. I took up the challenge,” says Ayush. “We started with just two products and now sell about 10 different products.”
The family invested Rs 10 crore in the partnership firm, which decided to focus primarily on e-vehicles. “My grandfather felt that e-vehicles will be a boon to the country as they would curb pollution, promote healthy living, and also bring down the cost of petrol. He expected that the demand for petrol would drop with the advent of e-vehicles,” says Ayush, sharing the Lohia patriarch’s vision behind launching the automobile business.
They set up their production plant at Kashipur, Uttarakhand in a 50-acre property. Lohia Auto got off to a good start and achieved a turnover of Rs 2 crore in the first year itself. However, the company took a hit when the government withdrew the subsidy on e- vehicles and it could not sustain the momentum of the first year.
In 2016, the Noida based company entered the diesel three-wheeler segment. Currently, they sell about ten products including electric scooters, e- rickshaws for passengers as well as cargo, three wheeler (diesel\CNG) passenger vehicles, cargo e-vehicles called Humsafar, and also solar powered vehicles. The price of three-wheelers starts from Rs 1.80 lakh, while two-wheelers are available from Rs 36,000 onwards.
With around 300 employees, Lohia Auto sold 12,000 vehicles in 2017-18 and clocked a turnover of Rs 120 crore. The company has 100 dealers and sells its vehicles in 40 cities across the country. The combined turnover of Lohia Global is Rs 700 crore.
Ayush was born to Vineet Kumar Lohia, eldest son of Narayan Kumar, who hails from Rajasthan, but later shifted to Moradabad. In 1995 Vineet came to Delhi, where Ayush went to a top notch school and then completed his graduation in commerce with specialization in cost accounting and management from Delhi College of Arts & Commerce.
While he was in college, he joined the family owned handicraft export company Designco as an entry level employee and learnt the rudimentary skills of designing and production.
“Starting from that position helped me to understand the nuances of the business,” says Ayush, recalling his early days in the Lohia group. “After my graduation I was given the responsibility to handle the sales department of Designco. As the marketing manager, I visited various countries between 2000 and 2005 and identified new markets.”
During his stint at Designco, the company won an award for highest export in metal decorative trade. Later, in 2005 he was instrumental in acquiring a stainless steel manufacturing unit and adding it to the portfolio of Lohia Global. Ayush set up a new mill and increased the production capacity of the steel unit from 600 tonnes to 3,000 tonnes per annum.
Impressed with his performance and business acumen, his grandfather handed the automobile project to him. Ayush did not disappoint. He continued to display his leadership skills and when the government withdrew the subsidy on e-vehicles he diversified into manufacturing of diesel three wheelers, which now brings additional revenue to the company.
In 2014, Lohia Auto launched UM Lohia Two Wheelers Private Limited - a 50:50 joint venture with UM Motorcycles - a US based firm, at an investment of Rs 100 crore. Selling four high-end petrol cruiser bikes, Renegade Commando Classic, Renegade Commando Mojave, Renegade Commando and Renegade Sports S at prices ranging between Rs 1.59 lakh and Rs 1.95 lakh, the company sold 9,800 bikes during FY 2017-18 and clocked a turnover of Rs 100 crore.
Ayush explains the rationale behind entering the cruiser bike market. “We needed to diversify, plan and strategize to overcome the sluggish economy and meltdown which was affecting the industries not just in India but all over the world. The answer was UM Lohia. UM brought US based manufacturing technology, and now we can roll out 1 lakh units each month.”
The Lohia family faced their biggest loss when Ayush’s grandfather passed away at the age of 84 in 2014. “It was a huge personal loss to me as I was very close to him, being the eldest grandson,” rues Ayush. “I learnt a lot of things from him including the zeal to work to the best of one’s capability.” True to that spirit, Ayush has now set his eyes on taking Lohia Auto to the Rs 500 crore turnover mark by 2020.
Ayush loves to spend time with his family which consists of his parents, wife, children and cousins who are more of siblings as they had all spent their childhood together in the same house.
The family loves going out for vacations to nearby places like Nainital, Mussoorie, as well as to Europe. Switzerland is his favourite holiday destination. Ayush is fiercely protective of his family – so much so he would not discuss about his children - and uses social media rarely.
About the future of the company and if he would like his children to follow in his footsteps, he says, “I would let my children decide for themselves. However for the business, I would like to create a legacy, wherein the business becomes self sustaining and can work on its own.”
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