Forgotten Brands – LML Scooters

Brothers Rishab Kumar Lohia and Gopal Chandra Lohia started the company that bears their names, Lohia Machines Limited.

The firm collaborated technically with ARCT France to produce machinery used in the production of synthetic yarn.

In 1978, the firm became public and began producing synthetic yarn.
In 1984, a scooter project was initiated after the signing of a technical partnership agreement with Piaggio, the Italian motorcycle manufacturer. In 1990, Piaggio and Vespa changed their business arrangement to one of equal partners.

So, the firm was about to see explosive expansion. The firm as a whole had to prepare to build 3.5 lakh automobiles per year, which is more than any other manufacturer in existence at the moment.

Deepak Singhania’s involvement with Lohia Machines had increased in the meantime. After that, J.K. Synthetics’ president and the man responsible for creating the synthetic fibre industry’s flagship company, Sitaram Singhania, boarded the ship.

At the same time, Lalit Kumar Singhania joined Lohia Machines from his position as president of the Kanpur-based J.K. Cotton Spinning and Weaving Mills Co. Ltd.

Seasoned hands were required to manage the company’s rapid growth from Rs 23 crore to Rs 500 crore in only five years.

The Lohias kept a small stake and gave management control to the Singhanias at the same time.

LML’s line of scooters, which includes the LML Vespa, LML Select, LML NV, and LML Star, became quite popular in India. These scooters gained popularity due to their robust construction, dependability, and vintage aesthetic. During the 1990s, LML scooters accounted for a significant portion of India’s scooter industry.

But the Indian market shifted towards motorbikes in the late 1990s, and scooter sales dropped. LML’s sales and market position suffered as a result of this shift and the increasing competition from other scooter manufacturers.

The Piaggio Collaboration

Unfortunately, the promising Indo-Italian joint company was dissolved with the tragic death of Giovanni Alberto Agnelli, the heir-designate to the Fiat vehicle dynasty, in 1997.

The Agnelli family’s Piaggio partnered with LML Ltd. in 1990; at the time, LML Ltd. had a 16% share of the Indian two-wheeler market, which was otherwise dominated by Bajaj Auto. Deepak Singhania, Lalit Singhania, and their cousin Sanjiv Shreya each owned 24% of the joint venture, while Piaggio owned 28.5%. The remainder was owned by individuals and banks. The JV was an expansion of the two companies technological cooperation, which had begun in 1982 and was set to end in 1994. Giovanni, Piaggio’s 26-year-old JV manager, went public with his conversations with Bajaj before finalising the equity tie-up with LML.
LML, which was in dire straits financially, saw the JV as a chance to diversify away from its dying conventional fibre sector and into the burgeoning two-wheeler manufacturing industry in India.

The foreign currency crisis and economic slump in the nation did not help matters, and the launch got off to a shaky start. The LML scooter was initially slow to gain traction, but with a financial injection and the introduction of additional models, the company quickly rose to prominence, eventually becoming the country’s second-largest scooter manufacturer. The business partners were finally ready to publicly declare their intention to join the scooter market in October 1997.

Giovanni’s untimely death at age 33 from intestinal cancer altered the situation, and in June 1998, Piaggio wrote to Deepak Singhania to advise him of a shift in strategy that would ultimately result in the company’s withdrawal from the JV. Singhania retorted that, given the new circumstances, he was entitled to acquire Piaggio’s share of the JV and dissolve it.

As time went on, the business finally disclosed to the financial markets that its joint venture partner, Piaggio, had submitted a notice for termination of the agreement. The Italian firm has also declared its intent to establish a wholly-owned subsidiary in India, where it intends to manufacture its whole line of high-end scooters and customised motorcycles. The Italian business Piaggio petitioned the Company Law Board to have Deepak Singhania removed as managing director of LML Ltd based on mismanagement, while Singhania petitioned the court for his right to buy out Piaggio’s interest.

The disagreements between LML and the Piaggio group were settled out of court in November 1999, and the JV was dissolved as a result.

LML’s market position and financial resources were both severely hampered despite the company’s best efforts.

Life After Piaggio

Later on, in 2002, LML attempted to resurrect the company by releasing several bikes like as the Adreno and the Freedom 110cc Commuter, but to no avail.

LML kept making the Star, a steel-bodied scooter with a traditional design, a 4-speed manual gearbox and a 150cc two-stroke motor.
Some of them were sold in the US under the Stella brand and in the UK under the A.K. International (AKII) label. UK exclusive distribution rights for AKII’s Aura LML & A.K. International (I&E) Ltd In 2008. The Via Toscana is the Euro 3 emissions compliance version of the Star Deluxe, which was reintroduced to the UK market by AKII (I&E) Ltd.

The Trendy 50 cc was manufactured by LML from 1998-2006; it was originally called the Benelli Scooty (1993) and was based on the 1981 Benelli S50. The whole scooter, including the motor, was a Benelli creation and so shared no components with the Piaggio.

Another contract to produce four-stroke bikes was struck in 1999, this time with Daelim Motor Company of South Korea.

Freedom In 2002, LML released their first luxurious commuter motorcycle, the 110 cc Spirit of Freedom. With the 2004 release of the LML Graptor, LML entered the 150 cc lifestyle market. It was the first bike of its kind to be developed and built in Italy by Ugolini. With the simultaneous release of the LML Graptor (150 cc), LML Freedom Prima (110 cc), and LML Freedom Prima (125 cc) in 2004, LML grew from a single-product firm to a multi-product two-wheeler corporation.

Despite modern bi-wheeler manufacturers like TVS, Hero, and Bajaj Auto growing multifold and increasing shareholder value, the company had been under financial constraints ever since its foray into bi-wheeler manufacturing due to excesses and overspending.

After securing fresh funding from Credit Suisse and other sources in July 2006, production of geared Vespa-style scooters, destined largely for export, resumed at the facility on March 8, 2008.

In 2009, LML introduced a 4-stroke scooter that looked and operated similarly to its 2-stroke sibling but with a 4-stroke motor.

LML reintroduced their 110 cc Commuter bike, the Freedom DX, in 2013.
In 2016, LML introduced the Star 125 Lite, a small-frame automated variant of the Star 125. The Star Euro 150 automatic model was also introduced. Also introduced was the Star Euro 200, a geared variant of the four-stroke engine.

In 2016, LML introduced the LML Buddy, a three-wheeled vehicle.
In 2017, the firm announced its formal closure. With LML’s demise, the heyday of the ubiquitous Indian scooter came to an end. On June 2, 2017, LML filed for bankruptcy protection.

As of August 2020, the plant has been shut down, with all machinery, spare parts, and scooters being sold for scrap.

Although LML’s headquarters were in Kanpur, Uttar Pradesh, the company’s scooters had widespread success across India. There are still many fans and collectors of LML scooters because of the company’s heritage.

After being acquired by SG Group, LML Ltd. has reentered the two-wheeler industry with electric vehicles.

Reference

https://www.indiatoday.in/magazine/economy/story/19840831-sitaram-and-lalit-singhania-leave-jk-singhania-group-join-lohia-machines-803680-1984-08-30

https://www.cnbctv18.com/business/companies/backstory–when-lml-and-piaggio-stormed-the-two-wheeler-market-before-parting-company-11221562.htm

https://en.wikipedia.org/wiki/Lohia_Machinery_Limited

https://www.goodreturns.in/company/lml/history.html