The company is having a tough time meeting even its day-to-day expenses, company insiders said. Production has dipped so much due to financial constraints that ``in the last two months, we have received only 20 cars as against a demand for 300, and advance payments made in January are still pending,'' said A L Quadros, general secretary of Mumbai Taximen's Union.The Padmini hit the roads in 1977, instantly endearing itself to taxi drivers with its rugged body, cheap and easily available spares. ``We could repair a severely damaged Padmini taxi overnight and put it on the roads the next morning,'' said Quadros. While the Hindustan Ambassador cornered the taxi trade in the three other metros, the Padmini capturedMumbai primarily due to proximity of the production lines to the city. Out went the older Fiats, Dodges, Plymouths and Austins.

The vehicle was sold to taxi drivers at a substantially lower cost (even today, the Padmini costs private individuals Rs 2.65 lakh but is Rs 20,000 cheaper for the taxi driver). This trend was started by JM Vakil, managing director of PAL in 1977 who believed the taxi was a `mobile advertisement' for the company. There are some 55,400 such mobile advertisements for PAL in Mumbai today, but their days could be numbered.

Rumblings of the end came three years ago when Padmini wound up production of its petrol model. Tagging on to the diesel version hasn't helped, and diesel-driven versions of the Italian car major Fiat and Tata Indica appear set to take over the city's taxi market. ``In the years to come, we will see more Unos and Indicas as taxis because both are economical in terms of fuel consumption,'' said an auto analyst. The Maruti 800 was tried a few years ago as a successorto Padmini and abandoned, for it was licensed to seat only three passengers, the capacity of a rickshaw. Moreover, parts were expensive, and the body and suspension delicate. The Omni was also tried and discarded for similar reasons, including weak suspension. But the Uno and Indica have now made headway.

While Uno is fast becoming the preferred vehicle for the cool cab segment, replacing Premier Padmini 1.37D, there is still time for the Tata Indica cab to hit the roads due to delivery problems. Quadros said the response last year from Indica for using its diesel version as a taxi was enthusiastic. But with over a lakh of bookings, the company is unable to deliver on time. Requests for the diesel version of Maruti Zen have met a similar fate. ``This may also be because manufacturers would want to wait for a year or two before seeing their models converted into taxis,'' he noted.

Cool cab owners, who till recently chose only the diesel car of Premier, are switching over to Uno, said auto analysts.``Already due to supply constraints, taxi owners are jettisoning Premier cars and going in for Unos,'' Fiat officials said. And though Premier has promised to continue production of the diesel version for the taxi trade, not too many people are convinced. Thanks to its steady misfortune, the company's shareholders are suffering with its scrip price languishing below par at Rs 9.60 as compared to Rs 19, its 52-week high. The company earlier produced Premier Padminis from its two plants in Kurla and Kalyan. But with the fall in fortunes, it signed a joint venture agreement with Automobiles Peugeot of France in 1994 and sold off its Kalyan plant to the company. As the French auto models failed to make a dent in the market, PAL dipped further into the red.Two years ago, PAL sold off its Kurla plant, and transferred its employees, to Fiat Auto, where the latter today holds over 75 per cent equity. The plant has a capacity to produce 60,000 cars and priority is being given by the Italians to produce Uno and Siena.As part of an arrangement with Fiat, PAL now pays a fee to manufacture its cars at the plant. In recent years, PAL has also retired over 1,000 employees, but it has not helped it turn around. The company's promoters, the Doshis, have also failed to introduce any new models. If urgent funds are not injected into PAL, bankers said, the company will wind up.