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| INDUSTRY Auto sales zoom 9% as cars keep rolling Automakers look forward to tax breaks, export incentives to sustain momentum SIAM sets up 2200 Free Pollution Check Camps on World Environment Day Salaries to rise, even if sales do not, decide automobile firms Global companies rush to tap Indian auto logistics market Govt, auto industry to work on cleaner fuel option project Date set for JLR local rollout INTERVIEWS/FEATURES Car exports on uphill drive with 42 pc jump in May Maruti's US revenue zooms past Suzuki's June to see a slew of new car launches Plunge in utility segment dents passenger vehicle sales Santro, Accent are here to stay Volkswagen Group appoints Maik Stephan as new MD for India Move to put car sales on back gear Honda sets up R&D unit for local parts, more hybrids likely COMMERCIAL VEHICLES Ashok Leyland May sales down by 64.54% CONSTRUCTION & AGRI MACHINERY Yamaha sees ten-fold jump in market share by 2012 SC allows TVS to manufacture Flame, with restrictions "Innovation is of prime importance to us": Anil Dua, senior vice-president, marketing and sales, Hero Honda Motors | ALLIED INDUSTRIES SC rejects MRF workers union's plea on wage settlement Amara Raja's online racing contest FINANCE & INSURANCE LUBRICANTS & ALTERNATIVE FUELS Oil rally stalls; prices hover around $68 INTERNATIONAL NEWS Electric cars unlikely to hit Japan roads till 2020: reports Audi May sales down 6 per cent BMW sales fall 18 pc in May from year earlier BMW, Audi say May car sales fell, but less sharply GM to halt medium-duty truck production Detroit suburbs beckon Fiat executives with $1,595 sandals ECONOMY & FINANCE Global cues, profit taking sink Sensex Crisis-hit sectors should get more funds: plan panel
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| INDUSTRY Go To Top Business Standard (Web & Print Edition) New Delhi: Robust growth in two- and three-wheelers masked the glaring glitches in automobile sales last month and pulled it up to a respectable 8.86 per cent. The glitches were most pronounced in commercial vehicles, whose sales plummeted by nearly 15 per cent. Sales of passenger vehicles, mainly cars and utility vehicles, dipped by just under 1 per cent, according to figures released by the Society of Indian Automobile Manufacturers, or SIAM). From February to April this year, vehicle sales grew in double digits. In April, passenger vehicles had grown by 5 per cent. The May decline, according to SIAM Director General Dilip Chenoy, is primarily due to the dip in sales of utility vehicles, which fell 29 per cent, while sales of small cars grew by an impressive 11 per cent. The small car segment contributes around 70 per cent to the total number of cars sold. Analysts say the other reasons for the drop in passenger vehicle sales in May is linked to the diminishing appeal of excise duty cuts announced in the stimulus package in January this year. Excise duty cuts helped car manufacturers to lower prices of cars. Industry executives say in addition to PSU banks lowering interest rates for car loans, more needs to be done. Like rationalising the excise duty on utility vehicles, which currently stand around 25 per cent. For small cars, its 8 per cent. Motorcycle sales for May grew by 12.34 per cent, a continuation of the double-digit growth seen since February. The sales for scooters grew by 11.5 per cent on the back of strong demand in urban markets. According to industry executives, the average waiting period for automatic scooters is around 20 days. Sales of three-wheelers grew by 5.27 per cent in May. This growth comes primarily from the passenger vehicle segment, which grew by 15.3 per cent. Commercial vehicle (CV) sales for May, comprising both medium and heavy vehicles, dipped by 37.5 per cent. While sales of light commercial vehicles grew by 11.8 per cent. Industry analysts say the stimulus package announced in January for the CV industry is insufficient to kickstart the industry. Apart from the economic recovery we expect in the second half of 2009, what the industry needs is investments in the countrys infrastructure, which directly creates demand for commercial vehicles, says R Seshasayee, MD of Ashok Leyland. The 15,000 bus order under the JNNURM project, according to industry executives, is yet to be finalised Orders for around 7,000 buses have been placed so far and the remaining order is yet to be realised, says one. Executives say long-term demand for buses will come only when the new government puts in place a comprehensive public transportation policy. SIAM does not expect June sales to be robust. A Mumbai analyst says demand, especially for two wheelers, could go into double digits once the RBIs guidelines on vehicle repossession norms are announced. That will spur lending from NBFCs. The other factor critical to vehicle sales are good monsoons, which will boost rural spending. http://www.business-standard.com/india/news/may-auto-sales-grownot-evenly/360481/ AUTO SALES ZOOM 9% AS CARS KEEP ROLLING New Delhi: Car sales rose 2.5% in May fourth month in a row to 1.13 lakh units against 1.1 lakh units in the same month last year. And overall auto sales showed 9% growth in May at 9.29 lakh units, against 8.53 lakh units in the corresponding month last year, according to data released by the Society of Indian Automobile Manufacturers (Siam). Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved" AUTOMAKERS LOOK FORWARD TO TAX BREAKS, EXPORT INCENTIVES TO SUSTAIN MOMENTUM The Financial Express (Web & Print Edition) New Delhi/Mumbai: Despite four consecutive months of positive growth, the forthcoming Budget will determine the future course of the countrys automobile industry, feel experts and analysts. Passenger car sales were up 2.48% in May, to 1,13,490 units, according to the Society of Indian Automobile Manufacturers. The current trends are encouraging. Things are looking up just a bit, but it is far from a turnaround. The Budget will be very important in terms of difference in excise duty on small cars and bigger cars, which has skewed the industry. Moreover, there is a huge scope of further reduction in interest rates, as retail lending continues to be at a higher rate as compared to the rates of the central bank, says Jnaneswar Sen, senior general manager (marketing), Honda Siel Cars India. After the 4% reduction in Cenvat across-the-board in the first stimulus package last December, small cars now attract 8% excise duty against 20% on bigger cars along with an additional duty of Rs 15,000 and Rs 20,000 on cars above 1500cc and 2000cc, respectively. The growth will only go up in next few months because of the low base, as sales had started declining around this time last year. But the industry seriously needs some kind of export incentives as well as incentives to boost demand in the domestic market, says Arvind Saxena, senior vice-president (sales & marketing), Hyundai Motor India. He pointed to the erstwhile Target Plus scheme that acted as a key growth driver of car exports from the country. Hyundai accounts for over 70% of car exports from India. Whatever growth we have seen in the last three-four months has been because of the effect of the two stimulus packages. Unfortunately, the effect is fading. To keep the growth going, the industry needs more stimulus from the government, says Sugato Sen, senior director, Siam. VG Ramakrishnan, director, automotive and transportation, Frost & Sullivan, South Asia and Middle East, says, The need of the hour is to eliminate additional taxes and excise duty. Further, rationalisation of value-added-tax is another area to be looked at closely, besides making finance available at the consumer level. Industry too was expecting softer rates. Bharat Doshi, chief financial officer, M&M, had said, With a new and stable government in place, we expect interest rates to be benign. Though the bankers are cautious, there is adequate liquidity in the market. CAR SALES GROWTH MAY TAKE U-TURN: SIAM PTI See this story in: The Statesman (Web Edition) New Delhi Domestic passenger car sales continued to grow for the fourth consecutive month with May sales registering a 2.48 per cent rise, but the trend may reverse soon unless there is more support from the government, says industry body SIAM.
On the basis of feedback received from vendors and dealers, SIAM is expecting lower sales in June. June will be worse for passenger vehicles. Fundamentals have not changed ~ unavailability and high cost of finance are still affecting, Mr Sen said, adding that public sectors banks were aggressively coming forward, but private sector lenders were not supporting the auto industry to a big extent.
In the passenger car segment during May, sales of car market leader Maruti Suzuki India (MSI) increased by 9.71 per cent to 62,878 units from 57,315 units in the same month last year, SIAM said. Hyundai Motor India, however, registered a dip of 4.10 per cent at 23,501 units as against 24,506 units a year ago.
http://www.thestatesman.net/page.news.php?clid=12&theme=&usrsess=1&id=257293 SIAM SETS UP 2200 FREE POLLUTION CHECK CAMPS ON WORLD ENVIRONMENT DAY Business Standard (Web Edition) See similar story in: The Pioneer (Delhi Print Edition) Society of Indian Automobile Manufacturers (SIAM) will organise free of cost 2200 PUC (Pollution Under Control) check-up camps in 256 cities across the nation, on World Environment Day. As a part of its ongoing campaign, SIAM with its special initiative SAFE (Society for Automotive Fitness & Environment) has undertaken this initiative with an objective to reduce vehicular pollution in the country. SIAM- SAFE has set up 2200 PUC check-up camps across the country with an aim to check more than 50,000 vehicles this year, and will also organize regular PUC & Inspection Certification camps for in-use vehicles in various parts of the country. This would make vehicle owners aware about the importance of safe vehicles and clean environment. In 2008, SIAM- SAFE had set up PUC check-up camps at 1200 dealerships covering more than 250 cities across the nation checking 25,000 vehicles.. Mr. Dilip Chenoy, Director General, SIAM said Indian automobile industry has always been at a forefront to safeguard the environment. SIAMSAFE is one such initiative where all stake holders and members come together to spread awareness about cleaner environment among vehicle owners and society as a whole. On the occasion of World Environment Day we are organizing free of cost PUC check up camps across the nation and we expect enthusiastic response and support from the public to make it a huge success. Mr. Harjeet Singh, President SAFE and A-VP Hero Honda said: SAFE is proud to associate itself in this mega programme during World Environment Day in partnering with automobile manufacturers and hope that this initiative impact the users in ensuring that proper maintenance is done for the vehicles. This activity is expected to register a significant number of vehicles varying from two-wheelers to commercial vehicles. SALARIES TO RISE, EVEN IF SALES DO NOT, DECIDE AUTOMOBILE FIRMS Danny Goodman Business Standard (Web & Print Edition) New Delhi: While sales of automobiles for the financial year 20082009 grew by less than 1 per cent, two-wheeler and passenger vehicle manufacturers have effected salary hikes across all levels of employees for the current year. Commercial vehicle manufactures like Tata Motors and Ashok Leyland also plan to hike salaries for their employees, even though demand for large CVs dipped by 33 per cent in the year. The highest pay hikes for the current year are set to come from Maruti Suzuki and Hero Honda. As part of its ongoing 25th anniversary celebration, Hero Honda gave a special across-the-board anniversary salary hike of around 9 per cent in January. This will be followed by the annual wage hike, which company officials say will be more than last years average 10 per cent hike. Despite witnessing a 23 per cent dip in sales last year, Bajaj Auto has announced a 7 per cent hike across all levels of its employees, lower than last years 10 per cent hike. Plus, the Pune-based manufacturer has effected a 7 per cent hike for executives entitled to performance-linked bonuses. The ratio between fixed and variable salary is in the ratio: 70:30. HR experts say salary hikes during difficult times are an attempt by companies to generate a positive, feel-good effect among employees, who fear losing their jobs should the downturn persist. Firstly, salary hikes of this nature mean companies see a trend reversal in auto sales. Demand is creeping in. Next, pay hikes not only boost employee morale, it also directly boosts performance, says Krishna Prakash, Managing Partner of EMA Partners International. The countrys largest manufacturer of passenger vehicles, Maruti Suzuki, despite a less than impressive sales volume growth of 1.45 per cent for the year ending March 2009, plans to give a salary hike. Last year, it gave an average hike of 15 per cent. GLOBAL COMPANIES RUSH TO TAP INDIAN AUTO LOGISTICS MARKET P. Manoj Mint (Web & Print Edition) Bangalore: Global vehicle carrier specialists such as Hegh Autoliners AS, Wallenius Wilhelmsen Logistics AS (WWL) and NYK Line are rushing to enter the Indian auto logistics market to tap the countrys rapidly growing automobile exports. Auto makers exported 1.53 million units of vehicles in the 12 months ended March, a 23.61% growth compared with the previous year. Norwegian vehicle carrier operator Hegh Autoliners will start regular shipping services from India from July to carry automobiles for various customers, said the firms India representative, K. Gopinath. Hegh Autoliners is a top global operator of vehicle transportation services, running around 70 pure car and truck carriers (PCTCs) on various routes for customers. The company is 67.5% owned by Norwegian shipping firm Leif Hoegh & Co., while the balance 37.5% is held by AP Moller-Maersk AS, the Danish shipping and oil conglomerate. The companys PCTCs made eight-nine calls at the Mumbai and Chennai ports in 2008 for carrying automobiles. From July, we will start regular services from these ports, Gopinath said. India is turning into an export hub for small and mini carsa move that is being led by Japanese car maker Suzuki Motor Corp. and South Koreas Hyundai Motor Co. Currently, Mumbai and Chennai are the only two ports that have terminals to handle automobile exports. Pure car carriers (PCCs) operated by NYK Line, Mitsui OSK Lines (MOL) and K-Line, regularly call at these ports. While Tata Motors Ltd, Suzuki, Ashok Leyland Ltd and Eicher Motors Ltd depend on the Mumbai facilities, owing to the ports proximity to their factories, Hyundai and Ford Motor Co. export cars through Chennai port, because it is located close to their plants. In October, Nissan Motor India Pvt. Ltd had signed an agreement with Union government-owned Ennore Port Ltd to export automobiles manufactured at its Oragadam plant near Chennai through the port. In May, NYK Line (India) Ltd, the Indian unit of Nippon Yusen Kabushiki Kaisha Ltd, or NYK Line, Japans biggest shipping company by fleet size and revenues, signed a memorandum of understanding with state-owned Container Corp. of India Ltd (Concor) to establish a joint venture for the transport of automobiles over rail. Both companies will have a 50% stake in the new venture. NYK Line is also one of the biggest PCCs in the world. A number of automobile manufacturers are scheduled to open or expand their businesses in India by 2010 in response to the rapid growth in demand for cars here. In the 12 months to March, 1.5 million cars and utility vehicles were sold in India, up 0.13% over the last year. Analysts expect more cars to be sold in India this year compared with last. Some of these companies that are setting up or expanding operations here are also looking at exports. Apart from exports, car makers also feel the need to transport vehicles within the country. NYK is entering Indias rail transport sector for moving automobiles to meet rising demand. The Indian car transportation market is estimated at around 1.5 million units a year, according to an executive at Concor, who did not want to be identified. The new venture will establish a hub-and-spoke network to provide rail services complemented by truck transport, thus allowing the company to satisfy expanding demand for automobile transport, NYK said in a statement The two partners will soon begin trial services from Delhi and Chennai, followed by regular services from three other major areas (north, south, and west). The eventual goal is for rail transport for automobiles to occur through use of auto racks. But for the time being, the automobiles will be loaded into containers. One container can accommodate five-six small cars or four medium-sized cars, and up to 45 containers can be hauled at a time, the NYK statement said. Billionaire Gautam Adani-promoted Mundra Port and Special Economic Zone Ltd (MPSEZ) has teamed up with WWL and NYK Line to set up a multi-user dedicated automobile terminal at Mundra port, the countrys biggest private port, located off the western coast. WWL, jointly owned by Swedish shipping firm Wallenius Lines AB and Oslo-listed Norwegian shipping group Wilh Wilhelmsen ASA, is a leading independent provider of global factory-to-dealer transport solutions for the automotive, agricultural and construction equipment industries. WWL operates around 65 PCTC and roll-on roll-off vessels. We want to turn Mundra port into a hub for automobile exports, said Sandeep Mehta, chief executive officer, MPSEZ. MPSEZ has already signed up with Maruti Suzuki India Ltd for a Rs100 crore, 250,000- units-a-year car export terminal, dedicated exclusively for the Japanese car maker. MPSEZ plans to raise car handling capacity at the terminal by an additional 400,000 units by 2010. http://www.livemint.com/2009/06/08221722/Global-companies-rush-to-tap-I.html GOVT, AUTO INDUSTRY TO WORK ON CLEANER FUEL OPTION PROJECT New Delhi: The auto industry is working with the Government on a project to mix hydrogen and CNG for a cleaner and more efficient fuel option for vehicles on the roads. The move is a part of industry efforts for introduction of eco-friendly vehicles and carrying out a slew of research activities to launch alternative fuel options, the Society of India automobile Manufacturers Director-General, Mr Dilip Chenoy, told PTI. DATE SET FOR JLR LOCAL ROLLOUT Piya Singh The Telegraph (Web Edition) Mumbai: The Jaguar and the Land Rover will drive into India on June 28. Tata group chairman Ratan Tata will launch the two iconic British automobile brands in Mumbai on that day. Tata Motors expects to sell less than 1,000 Jaguar and Land Rover cars in India in the first year of the launch, said sources. A Tata Motors spokesperson said, The target figures are purely speculative and cannot be commented upon. Suffice it to say that the Jaguar and the Land Rover are planning for steady growth. Tata Motors, which bought the Jaguar and Land Rover from Ford last year for $2.3 billion, has decided to roll out different models of both these brands in Mumbai first. Thereafter, the models will be launched in six other cities. The roll-out plan focuses on one dealer each in six other major Indian cities that will sell cars from the JLR stable, said a source familiar with the development. The launch plan includes introducing models such as the Jaguar XF that combines the styling of a sports car with the space of a luxury saloon and the Jaguar XK that stands for speed. From the Land Rover range, Tata Motors intends to introduce the entry-level luxury SUV called Discovery, the compact Freelander and the Sport, a top- of- the -line model. Initially the cars will be imported as completely built units. This will attract high import duties of over 100 per cent. The idea is to introduce these models in the country and give them some time to gain popularity. Tata Motors is not in a hurry to achieve massive volumes, said a source familiar with the launch. In an effort to popularise the imports, Tata group company Indian Hotels, which runs the Taj chain of hotels, will use the high-end Jaguars to service its guests. The newly formed premier car division within the Tata Motors passenger car business unit will take charge of the distribution of all the Jaguars and the Land Rovers in the country. For months, Tata Motors had struggled to refinance the debt it had taken to buy these marquee brands. It also sought help from the UK government. Recently, the company managed to refinance $2 billion of a bridge loan towards the JLR acquisition. http://www.telegraphindia.com/1090609/jsp/business/story_11084135.jsp | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| CARS, SUVs, MUVs Go To Top The Economic Times (Web & Print Edition) New Delhi: Growth in car sales slowed down in May, though the segment managed to stay in positive territory for the fifth straight month, prompting an industry body to warn that it may be uphill from here for want of booster measures such as further cuts in consumer financing rates. Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved" Devidutta Tripathy / Reuters Mint (Web Edition) New Delhi: Car sales in India rose an annual 2.5% in May, climbing for the fourth month, as aggressive rate cuts and stimulus packages helped, but the momentum is set to ease, an industry body said on Monday. Borrowing costs still remain high and the effect of government support measures such as tax cuts are waning, Sugato Sen, senior director at the Society of Indian Automobile Manufacturers (SIAM) said. The fundamentals are not improving. Industry is feeling that the effects of stimulus is fading to some extent, he told reporters. You need more (stimulus). Companies sold 113,490 cars in May, compared with 110,745 cars a year ago, data from SIAM showed. Sales of trucks and buses, which are more dependent on the pace of economic activity, fell for a 10th straight month, dropping 14.8% in May from a year earlier to 30,800 units. June will be worse than May, based on the feedback we are getting, Sen said, referring to passenger vehicles that include cars and utility vehicles. Passenger vehicle sales fell 0.8% from a year earlier to 140,823 units in May, the data showed. Indias economy grew 6.7% in the fiscal year ended March, its weakest pace in six years, hurt by the global economic crisis. The Reserve Bank of India (RBI) expects growth to further slow down to 6% in 2009-10. Manufacturing was weak in the March quarter, posting a 1.4% contraction after having risen 0.9% in the December quarter. The world automobile industry has been going through a rough patch, with Japans industry-wide auto sales falling 19 percent in May from a year earlier. In the United States, May auto sales fell 34% from a year earlier as Chrysler and General Motors battles bankruptcy. Car sales in India, dominated by Maruti Suzuki, 54.2% owned by Japans Suzuki Motor Corp, have been rising since February after the government reduced factory-gate duties and also initiated measures to reduce interest rates. Maruti, which controls 1 in 2 cars sold in India, earlier reported its May sales rose 15.8 % from a year ago to 79,872 but Tata Motors passenger vehicles sales fell 16%. Analysts expect Indias economy will pick up in the second half of the year, with Prime Minister Manmohan Singhs coalition that won a second five-year term in May expected to announce more spending to speed up growth. Motorcycle sales rose 12.3% to 576,541 units in May, powered by Hero Honda Motors, owned 26% by Japans Honda Motor Corp, which rode on strong demand from rural and semi-urban areas. The BSE Auto Index has more than doubled so far in 2009 while the main index has risen more than 50%. The auto stocks were the most beaten down last year and the recovery has also been faster for them, said Vaishali Jajoo, auto analyst with Angel Broking. With sales growing every month for the last four months, people are expecting a recovery in the longer term. A dip for one or two months will not make much of a difference. She said sales in June and July were usually low because of monsoon rains and fewer marriages. http://www.livemint.com/2009/06/08094323/Car-sales-rise-25-in-May.html The Telegraph (Web Edition) New Delhi: Passenger cars recorded a sales growth of just 2.48 per cent in May, while two-wheelers grew at an impressive 12.45 per cent. Though rate cuts and the stimulus packages announced by the previous UPA government helped the industry to grow for the fourth successive month, automobile makers demanded fresh support because of the high cost of funds. Borrowing costs still remain high and the effect of the government support measures such as tax cuts are waning, said Sugato Sen, senior director of the Society of Indian Automobile Manufacturers (Siam). The fundamentals are not improving and you need more (stimulus), he said. According to Siam data, domestic passenger car sales in May went up to 1,13,490 units from 1,10,745 units in the year-ago period. In the same month, two-wheeler sales surged to 7,27,937 units from 6,47,358 units. Bike sales were up 12.34 per cent at 5,76,541 units against 5,13,209 units in the corresponding month a year ago. Siam is, however, apprehending lower sales in June and its fear is based on the feedback received from vendors and dealers. June will be worse. Fundamentals have not changed unavailability and the high cost of finance are still affecting, Sen said. Though public sector banks are coming forward, private lenders are not supporting the auto industry to a big extent, he said. Industry analysts, too, believe its going to be a challenging year for the industry. No doubt the industry has recovered but a further push is needed to help the industry get back on its feet faster, said Murad Ali Baig. Vehicle sales in May stood at 9,29,596 units against 8,53,969 units, up 8.86 per cent. In the passenger-car segment, sales of Maruti Suzuki increased 9.71 per cent to 62,878 units from 57,315 units in the same month last year. Hyundai Motor India registered a dip of 4.10 per cent at 23,501 units as against 24,506 units a year ago. Sales of Tata Motors were down at 12,838 units against 14,228 units. http://www.telegraphindia.com/1090609/jsp/business/story_11084141.jsp AUTOMAKERS LOOK FORWARD TO TAX BREAKS, EXPORT INCENTIVES TO SUSTAIN MOMENTUM Yahoo India (Web Edition) Despite four consecutive months of positive growth, the forthcoming Budget will determine the future course of the country's automobile industry, feel experts and analysts. Passenger car sales were up 2.48% in May, to 1,13,490 units, according to the Society of Indian Automobile Manufacturers. "The current trends are encouraging. Things are looking up just a bit, but it is far from a turnaround. The Budget will be very important in terms of difference in excise duty on small cars and bigger cars, which has skewed the industry. Moreover, there is a huge scope of further reduction in interest rates, as retail lending continues to be at a higher rate as compared to the rates of the central bank," says Jnaneswar Sen, senior general manager (marketing), Honda Siel Cars India. After the 4% reduction in Cenvat across-the-board in the first stimulus package last December, small cars now attract 8% excise duty against 20% on bigger cars along with an additional duty of Rs 15,000 and Rs 20,000 on cars above 1500cc and 2000cc, respectively. "The growth will only go up in next few months because of the low base, as sales had started declining around this time last year. But the industry seriously needs some kind of export incentives as well as incentives to boost demand in the domestic market," says Arvind Saxena, senior vice-president (sales and marketing), Hyundai Motor India. He pointed to the erstwhile 'Target Plus' scheme that acted as a key growth driver of car exports from the country. Hyundai accounts for over 70% of car exports from India. "Whatever growth we have seen in the last three-four months has been because of the effect of the two stimulus packages. Unfortunately, the effect is fading. To keep the growth going, the industry needs more stimulus from the government," says Sugato Sen, senior director, Siam. VG Ramakrishnan, director, automotive and transportation, Frost and Sullivan, South Asia and Middle East, says, "The need of the hour is to eliminate additional taxes and excise duty. Further, rationalisation of value-added-tax is another area to be looked at closely, besides making finance available at the consumer level." Industry too was expecting softer rates. Bharat Doshi, chief financial officer, MandM, had said, "With a new and stable government in place, we expect interest rates to be benign. Though the bankers are cautious, there is adequate liquidity in the market." http://in.biz.yahoo.com/090608/203/batp86.html CAR EXPORTS ON UPHILL DRIVE WITH 42 PC JUMP IN MAY PTI See this story in: The Economic Times (Web Edition) New Delhi: Exports of passenger cars from the country soared 41.64 per cent in May, mainly on the back of robust performance by Maruti Suzuki, although domestic sales increased by a meager 2.48 per cent. PTI See this story in: The Tribune (Web Edition), The Indian Express (Web Edition) New Delhi: Exports of passenger cars from the country soared 41.64 per cent in May, mainly on the back of robust performance by Maruti Suzuki, although domestic sales increased by a meager 2.48 per cent. According to the data by the Society of India Automobile Manufacturers (SIAM), passenger car exports from the country stood at 29,619 units in May this year as against 20,911 units during the corresponding month of 2008. The export growth was largely driven by the country's largest car maker Maruti Suzuki India as its sales grew 90.69 per cent to 9,012 units in the month compared with 4,726 units during the year-ago period, SIAM said. The country's largest-exporter Hyundai Motor India reported a jump of 27.77 per cent in exports during May at 20,125 units compared with 15,751 units in the same month last year. Homegrown auto major Mata Motors, however, witnessed a dip of 25.35 per cent in its overseas sales of passenger cars at 324 units as against 434 units in the year- ago period. SIAM said exports of total passenger vehicles, including utility cars, grew by 39.22 per cent in May at 29,763 as against 21,378 units in the same month last year. Domestic passenger car sales increased by 2.48 per cent to 1,13,490 units in May from 1,10,745 units in the same month last year, it added. In the two-wheeler segment, total motorcycle exports grew by 5.20 per cent in May at 78,354 as against 74,484 in the year-ago period. Market leader Hero Honda's sales in the overseas markets grew by 53.81 per cent to 8,472 units from 5,508 units during May last year. Rival Bajaj Auto's exports rose by 3.71 per cent at 51,419 units compared with 49,581 units during the same month last year. Total scooter exports, however, dipped 24.17 per cent at 1,584 units as against 2,089 units in the year-ago period. The downward trend of commercial vehicles continued in the export markets as well with sales slipping by 51.06 per cent to 2,272 units from 4,642 units in May, 2008, SIAM said. http://www.tribuneindia.com/2009/20090609/biz.htm#3 http://www.indianexpress.com/news/car-exports-on-uphill-drive-with-42-jump-in-may/473132/ CAR EXPORTS SPURT BY 42 PER CENT IN MAY 09 Deccan Herald (Web Edition) New Delhi: According to Society of India Automobile Manufacturers (SIAM) data, passenger car exports stood at 29,619 units in May this year as against 20,911 units during the corresponding month of 2008. http://www.deccanherald.com/content/7006/car-exports-spurt-42-per.html PTI See this story in: The Statesman (Web Edition) New Delhi: Exports of passenger cars from the country soared 41.64 per cent in May, mainly on the back of robust performance by Maruti Suzuki, although domestic sales increased by a meagre 2.48 per cent. According to the data by the Society of India Automobile Manufacturers (SIAM), passenger car exports from the country stood at 29,619 units in May this year as against 20,911 units during the corresponding month of the previous year. The export growth was largely driven by the country's largest car maker Maruti Suzuki India as its sales grew 90.69 per cent to 9,012 units in the month compared with 4,726 units during the year-ago period, SIAM said.
http://www.thestatesman.net/page.news.php?clid=12&theme=&usrsess=1&id=257303 MARUTI'S US REVENUE ZOOMS PAST SUZUKI'S Swaraj Baggonkar Business Standard (Web & Print Edition) Mumbai: For the first time in more than a quarter century, Maruti Suzuki, the Indian subsidiary of Suzuki, posted higher revenues from the US than that of the Japanese car-maker during the last financial year. Between April 2008 and March 2009, when automobile giants across the globe witnessed a drastic fall in demand, Maruti Suzuki posted a revenue growth of 10 per cent, whereas Suzukis North America operation reported a decline of 55 per cent. According to the audited financial results of Maruti, the companys income in FY09 stood at Rs 23,085 crore as against Rs 10,000-Rs 11,000 crore ( 225,601 million) reported by Suzukis North America operation. MSIL had reported revenues of Rs 18,000 crore in 2007-08. Speaking to Business Standard, Maruti Suzuki India (MSIL) Chairman R C Bhargava said, Last year, we produced more cars than any other previous years. The US market was down due to a number of reasons, but Maruti posted a growth. Probably this year too, we will see the same pattern... So far in the current quarter, we have seen some revival in demand in India. This will hopefully carry forward as we do not expect any increase in tax rates for the automobile sector. Suzukis North American operations had reported a revenue fall of 55.6 per cent compared to 2007-08 (when the company posted a total revenue of Rs 21,500-Rs 23,000 crore) on account of reduced sales. Its operating income stood negative at yen 24,143 million (about Rs 1,200 crore). Suzuki holds a little over 54 per cent stake in MSIL, which is one of the most profitable companies of the Japanese auto major. In May, Marutis domestic market share stood at 62 per cent, followed by Korean car-maker Hyundai Motors and Tata Motors. During FY09, MSIL sold close to 7.92 lakh units, of which 70,000 units were exported. However, when compared to FY08, its sales grew marginally by 3.6 per cent to 7.64 lakh units. Senior officials of MSIL attribute the increase in revenues to higher realisations from top-selling brands such as Swift and Swift DZire. In order to keep pace with the demand from domestic and international markets (the company exports models to Europe), MSIL has decided to pump in Rs 1,800 crore in the current financial year to increase its capacity to 1 million cars from less than 900,000 units at present. Besides, the company is also mulling to shift a major portion of its small car manufacturing activities to India to save on costs and also ease the burden of the parent company, which will focus on bigger cars and alternative fuel options. India will continue to remain at the centre of Suzukis global scheme of things as the Japanese giant has already chalked out some aggressive expansion plans in the export segment in the immediate future. http://www.business-standard.com/india/news/marutis-us-revenue-zooms-past-suzukis/360482/ JUNE TO SEE A SLEW OF NEW CAR LAUNCHES Sohini Das Business Standard (Web & Print Edition) Kolkata: After the launch of Audis crossover utility vehicle Q5, June will see two more heavyweight car launches within days of each other, making this month the one with the most number of launches in the last nine months. The launches indicate that the automotive industry is slowly coming out of the downturn, with most companies registering positive sales figures in May. Auto majors like Maruti Suzuki India and Hero Honda posted 10.4 and 22.5 per cent growth in domestic sales last month respectively. Upbeat from positive market conditions, car makers have lined up a series of launches during the second half of the year. Honda Siel Cars India will launch its popular compact car Jazz on June 10 and Fiat India bringing in its premium compact car Grande Punto into the Indian market just seven days later on June 17. We are upbeat that the Grande Punto will create ripples in the B+ segment, which is growing at a 4 per cent right now, Fiat India Automobiles Pvt Ltds President and CEO Rajeev Kapoor said. He added that the company was looking at a 14-15 per cent market share in the segment, which is dominated by Maruti. The supermini from the Fiat stable helped the Italian car major to perform against the downturn in Europe. The company achieved a 5 per cent rise in sales, together with increasing its market share to 10 per cent last fiscal when the European market actually contracted by 11.6 per cent. But the cars fortunes in India will depend heavily on its pricing strategy. We have an almost 85 per cent localisation in the Grande Punto and this will help us to have a competitive pricing, Kapoor said. Sources close to development indicated that the Grande Punto could be priced at an edge above the Tata Indica Vista so that there was no cannibalisation amongst the two cars. Fiat India will sell the car through the 100-odd Tata-Fiat dealerships across the country. The Honda Jazz, on the other hand, is likely to be priced higher. The Jazz is made on the City platform and that definitely defines the cost structure, if not the price. Moreover, we have decided to provide all amenities like airbags, anti-braking system and a powerful 1.2-litre iVTEC engine in the Jazz, Honda Siel Cars Indias Vice-President (marketing) Jnaneswar Sen said. http://www.business-standard.com/india/news/june-to-seeslewnew-car-launches/360518/ PLUNGE IN UTILITY SEGMENT DENTS PASSENGER VEHICLE SALES The Hindu Business Line (Web & Print Edition) New Delhi: There has been a sharp plunge of 29 per cent in the sale of utility vehicles during May because of lower demand from fleet operators, concerns over defaults, and the cautious approach of the banks to lend. Since utility vehicles such as Mahindras Scorpio and Xylo, Tatas Sumo and Safari, General Motors Tavera and Toyota Innova form a component of passenger vehicles, the sales of passenger vehicles declined 0.79 per cent. However, another segment, passenger cars, has shown an increase of 2.47 per cent. Maruti Suzuki lead in the car segment. The companys sales were up by 9 per cent to 62,878 units. Honda Siel Cars also posted an 11 per cent increase in sales at 4,073 units. Few other automakers such as Hyundai and Tata Motors saw their domestic sales drop 4 per cent and 9 per cent respectively. Stimulus effect The situation is still worrisome. The effect of stimulus package is wearing off. Even for cars, financing is still not sufficient for the market to pick up, said a senior official with the Society of Indian Automobile Manufacturers. The fiscal stimulus package norm on depreciation of commercial vehicles and the bus purchase programme are yet to translate into major sales for commercial vehicle players. The slow economic growth reflects in the demand for trucks and buses whose sales fell by 37 per cent to 12,181 units in May on a year-on-year basis. Light commercial vehicles, used mainly for intra-city movement, saw a better offtake with sales touching 18,619 units. This is a 11.83 per cent growth vis--vis the same month last year. The official further said, For commercial vehicles the economy has to grow. Even in case of the bus purchasing programme, companies are not fully geared to supply the low-floor buses as specified by the Government. This will also take 4-6 months time for companies to deliver. Two-wheelers The two-wheeler industry grew at a healthy pace with scooter sales rising 11 per cent at 1.08 lakh units. Motorcycle sales touched 5.76 lakh units, a 12 per cent increase in May over the same period the previous year. Motorcycle sales were spurred by Hero Honda, the largest player whose sales jumped 20 per cent to 3.59 lakh units. In contrast, Bajaj Auto sales were down by 12 per cent at 1.13 lakh units. TVS reported a 3 per cent increase in bike sales at 43,165 units. http://www.thehindubusinessline.com/2009/06/09/stories/2009060952430100.htm SANTRO, ACCENT ARE HERE TO STAY Rebecca Rassendren Asian Age (Web & Print Edition) Bengaluru: Hyundai Motors will not phase out its Santro and Accent models any time soon, company executives said, denying rumours that the new Hyundai i10 (1.1 litre) was being peddled as a replacement. "We will continue to produce both the models and there is no question of phasing them out or cutting production," the managing director of Hyundai Motors India, Mr HS Lheem, said. The two models, he added, play a vital role in the firms growth. The Santro sells around 8,000 units per month while the Accent sells around 1,000 units a month. Company officials said Santro has a huge demand in the taxi market with almost 50 per cent of the models production now sold as taxis in North India. Accent, on the other hand, has a good overseas market, particularly in Europe. All models put together, Hyundai sold 4,89,328 units in 2008 as against 3,27,161 units the previous year. The firm claims a market share growth of about three per cent to 20.4 per cent in 2008 in terms of the Indian automobile industrys overall unit shipment. This year, the company intends to sell 5.8 lakh units. Meanwhile, sources confirmed that the automaker will roll out a small car by 2010, expected to be priced at about Rs 2 lakh. VOLKSWAGEN GROUP APPOINTS MAIK STEPHAN AS NEW MD FOR INDIA PTI See this story in: Hindustan Times (Web Edition), The Statesman (Web Edition), The Hindu Business Line (Delhi Print Edition), Mint (Delhi Print Edition) Mumbai: With a view to expand its presence and strengthenen the sales activities in the country, the Volkswagen Group on Monday made major appointments in its management with effect from June 1, 2009. The company appointed Maik Stephan as Managing Director of Volkswagen Group Sales India, the Group's sales company in the country. Stephan would report to Volkswagen Group Chief Representative India and President and Managing Director of Volkswagen India Joerg Mueller, the company said. The company also appointed Lutz Kothe as Chief General Manager (Marketing and PR) at the Volkswagen brand. He will report to Volkswagen India Director (Volkswagen Passenger Cars Division), Neeraj Garg. "I am delighted that we are being joined by Maik Stephan and Lutz Kothe, whose long-standing experience in the Volkswagen Group and sound expertise will drive forward the expansion of our presence here on the Indian growth market," Mueller said. http://www.hindustantimes.com/StoryPage/StoryPage.aspx?sectionName= http://www.thestatesman.net/page.news.php?clid=12&theme=&usrsess=1&id=257301 MOVE TO PUT CAR SALES ON BACK GEAR Shweta Bhanot The Financial Express (Web & Print Edition) Mumbai: The announcement of 8% vehicle tax on cars costing Rs 10-20 lakh and 9% on cars costing more than above Rs 20 lakh by the Maharashtra government has not gone well with the countrys automobile fraternity. Maharashtra stands next to Delhi in terms of importance to automobile makers, with double-digit sales contribution for companies. The market attracted sales of a total of 16,34,112 cars as on March 31, 2009. Indicating the move will impact the sales of the cars in these brackets, industry experts feel this was definitely not warranted at a time when the automobile industry needs stimulus packages and had started showing some improvement since January 2009. Till now, cars were attracting 7% vehicle tax, which doubled if it was owned by a company or imported. However, now cars up to Rs 10 lakh will be attracting 7%. Honda Siel Cars India Ltd senior general manager marketing Jnaneswar Sen said, This will have impact on our models like Civic, Accord and CR-V. He added Maharashtra is on the higher side when it comes to vehicle tax but is behind Karnataka, which is the highest with vehicle tax hovering around 16%. Maharashtra contributes anywhere between 10%-15% of the sales for Honda. He further pointed all the elements of tax together till the ex-showroom stand at 100%, which goes to the government. To put things into perspective for a Honda Civic costing Rs 12 lakh (ex-showroom Mumbai), the private owner will have to pay Rs 96,000 vehicle tax considering the 8% on it, instead of Rs 84,000 in case of 7% earlier. Some of the cars fall in 8% vehicle tax bracket include Honda Civic, Honda Accord, VW Jetta, Hyundai Sonata, Toyota Corolla Altis, Skoda Laura and Octavia. While in 9% vehicle tax bracket include Skoda Superb, Toyota Camry, VW Passat, Mercedes full range, Audi full range, BMW full range and other luxury brand cars. When contacted a BMW spokesperson said, Few per cent increase will hardly make a different and will not impact our sales. Every region has different tax regime. However, a renowned dealer in Mumbai of brands including BMW, Rolls Royce and other said, It will have an immediate impact on the customers. More so on the corporate buying and imported cars. Similar feelers came from the other company dealers falling in these brackets like Toyota, Mercedes-Benz, VW Group brands. The fillip side of the story is that many look at this announcement as state governments step to promote small and fuel efficient cars. PricewaterhouseCoopers auto analyst and partner Abdul Majeed said, This is a clear push for small cars in line with what is happening in many more countries now.... http://www.financialexpress.com/news/move-to-put-car-sales-on-back-gear/473264/2 HONDA SETS UP R&D UNIT FOR LOCAL PARTS, MORE HYBRIDS LIKELY Sumant Banerji Hindustan Times (Delhi Print Edition) New Delhi: Looking to increase local content in their products and decrease the share of expensive imported components, Honda Siel Cars India has set up a research and development division at its Greater Noida Unit. The division which comprises 15 engineers will not be developing any new product but will identify suitable vendors for component sourcing for its existing and future products. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| COMMERCIAL VEHICLES Go To Top The Indian Express (Web & Print Edition) New Delhi: Sales in the commercial vehicle (CV) segment confirm signs of an ongoing revival in the automobile industry. Monthly sales numbers show that the automobile sector be it passenger cars, two-wheelers, commercial vehicles or utility vehicles had reached its lowest point in December 2008, but has since delivered sequential growth. The April sales for utility vehicles had more than doubled from the December levels. Commercial vehicle manufacturers in the country continue their slow but steady march towards breaking even with comforting if not spectacular sales results in May. Though Ashok Leyland, Mahindra and Mahindra (M&M) and even segment leaders Tata Motors all registered an overall decline in sales, monthly numbers show that sales in May 2009 have nearly doubled from their lowest level in December 2008. Light CVs (LCVs) posted strong results for both Tata Motors and Ashok Leyland though Mahindra and Mahindra saw a marginal decline. As many as 14,380 units were sold by Tata Motors which gave it a 20.44 per cent growth over the 11,980 units sold in the May of last year. Though this is lower than the 51.69 per cent registered in April 2009, it marks a fourth consecutive month of positive sales in this segment for the company. Ashok Leyland, which does not have much of a base in this segment, also managed a 28.57 per cent positive growth its first since February this year when sales had declined sharply for 2 months. The company sold 54 units in May 2009 over 42 units during the same period last year. Mahindra and Mahindra on the other hand saw sales decline as 776 units were sold in May 2008 and only 648 units in May 2009, a 16.49 per cent decrease. On the other hand, though the sale of Medium and Heavy CVs (MHCVs) remains deep in the negative zone for all major manufacturers, now that infrastructure projects have been fast-tracked and are beginning to move again, companies are optimistic that things should begin to improve especially since the negativity of their sales results has been constantly declining since the beginning of the year. Tata Motors posted only a 26.55 per cent decline in sales, their best result in 8 months this May selling 8,624 units against 11,742 units in May 2008. Ashok Leylands sales growth percentage on the other hand dropped significantly from a 6-month low of 53.86 per cent to 71.09 per cent between March and April 2009 before recovering slightly this month to record a 67.90 per cent decline. The company sold 1,643 units in May 2009 over 5,119 units sold during the same month last year. Total sales for the company told a similar story with 1,697 units in May 2009 against 5,161 units in May 2008, giving Ashok Leyland a 67.12 per cent decline in sales which while better than the 70.90 per cent decline last month is not as good as the 53.45 per cent decline they had recorded in March 2009. Tata Motors on the other hand, which registered its first positive overall growth in 6 months last month with a 8.79 per cent growth, slipped to a 2.86 per cent decline this month due to lower LCV sales selling 23,004 units in May 2009 whereas 23,682 units had been sold in the May of last year. http://www.indianexpress.com/news/cv-sales-down-yoy-but-signs-of-revival-continue/473363/1 ASHOK LEYLAND MAY SALES DOWN BY 64.54% PTI See this story in: Business Standard (Web Edition), The Hindu Business Line (Web & Print Edition) New Delhi: Hinduja Group flagship firm Ashok Leyland reported a 64.54 per cent fall in commercial vehicle sales at 1,977 units in May this year compared to the same month in 2008. The company had sold 5,576 units in the same month last year. Domestic sales stood at 1,697 units in May against 5,161 units in the same month last year, down 67.12 per cent, Ashok Leyland said in a statement. Exports fell by 32.53 per cent to 280 units in the month compared to 415 units in the year-ago period. The company reported a decline of 67.90 per cent in total domestic sales of medium and heavy commercial vehicles at 1,643 units from 5,119 units in the same month last year. However, domestic light commercial vehicles sales grew by 28.57 per cent at 54 units in May against 42 units in the corresponding period last year. http://www.business-standard.com/india/news/ashok-leyland-may-sales-down-by-6454/64082/on http://www.thehindubusinessline.com/2009/06/09/stories/2009060952140200.htm | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CONSTRUCTION & AGRI MACHINERY Go To Top | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2/3 WHEELERS Go To Top Vishnu Pandey Business Standard New Delhi/ Kanpur: Two-wheeler sales have seen an unexpected rise in the past one month in Kanpur, with the sales rising 25 per cent. Moreover, the increased demand has led to short supply of bikes, which command over 80 per cent of the two-wheeler segment in the region. Hero Honda bikes are the most in demand followed by Bajaj. Authorised dealers expect the demand-supply gap to bridge by mid-June. According to Hero Honda dealer Nitin Gupta, his dealership sold around 2,000 Honda bikes during May last year, while it has already breached the 2,500-unit mark this year. The rise in sales can be attributed to the ongoing Hindu marriage season, pushing the demand for conjugal gifts, especially two-wheelers, Nitin said. Bajaj dealer, Amit Garg, told Business Standard that Pulsar and Discover bikes were being booked 10 days in advance in view of the current shortage. So far this year, Garg has already sold 650 bikes, as against 425 units last year. TVS motors sales manager, SS Jauhri pointed out that the number of matrimonial alliances this year was well ahead of 2008, resulting in sales of over 4,500 two-wheelers in May, as compared with 3,000 units sold last year. The two-wheeler segment has shown remarkable resilience in recovering from the brief spell of slowdown towards the end of last year, Jauhri said. http://www.business-standard.com/india/news/two-wheeler-sales-inchin-kanpur/360408/ YAMAHA SEES TEN-FOLD JUMP IN MARKET SHARE BY 2012 The Economic Times Siliguri: Two-wheeler giant Yamaha has set an aggressive target of increasing its market share in India by ten times by end-2011. Besides product launches, growth in the number of outlets is also on the cards. Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved" SC ALLOWS TVS TO MANUFACTURE FLAME, WITH RESTRICTIONS PTI See this story in: The Economic Times, The Tribune, The Hindu, The Pioneer, The Telegraph, The Statesman, Business Standard New Delhi: The Supreme Court on Monday allowed Chennai-based two-wheeler company TVS Motor Company Ltd to manufacture TVS Flame, a 125-cc bike sporting twin-spark plugs, the technology for which Bajaj Auto claims it holds the patent rights. However, it did not permit TVS to move its "finished product (motorcycle) from its warehouse" after the company gave an undertaking in this regard. http://www.tribuneindia.com/2009/20090609/biz.htm#4 http://www.hindu.com/2009/06/09/stories/2009060956401400.htm http://www.dailypioneer.com/181591/SC-allows-TVS-to-manufacture-Flame-bike.html http://www.telegraphindia.com/1090609/jsp/business/story_11083701.jsp http://www.thestatesman.net/page.news.php?clid=12&theme=&usrsess=1&id=257292 http://www.business-standard.com/india/news/make-flamedont-sell-it-sc-to-tvs/360491/ "INNOVATION IS OF PRIME IMPORTANCE TO US": ANIL DUA, SENIOR VICE-PRESIDENT, MARKETING AND SALES, HERO HONDA MOTORS Alokananda Chakraborty , Malabika Sarkar The Financial Express Bucking the slowdown in the two-wheeler market in India, Hero Honda reported a 12% growth in 2008-09 and kept up the momentum by posting an unprecedented sales of 3,70,575 units for the month of April 2009. The companythe largest two-wheeler maker in the world in terms of volumessays that while competitors were cutting down on marketing costs in an effort to improve bottomline, it kept the faith and pumped in money into sprucing up its portfolio and adding to its distribution muscle. In this interview to FEs Alokananda Chakraborty and Malabika Sarkar, Anil Dua, senior vice-president, marketing and sales, Hero Honda Motors, analyses its performance for the last fiscal and its plans for the year ahead. Youve begun 2009-10 with a bang, even as the domestic two-wheeler industry continues to reel under high interest rates, credit squeeze and overall recessionary trends. Where has this growth come from? We have begun the new financial year 2010 with robust growth in the month of April. This is in keeping with the growth trajectory that we maintained last year to close the fiscal 2009 with 12% growth. The last couple of years have been quite tough for the two-wheeler industry due to the uncertainty over interest rates and an overall credit squeeze. For us, the growth has been coming from all segments and across geographies. This has been possible due to several strategic initiatives that we have taken. We keep refreshing our entire product portfolio with regular frequency to meet the fast-evolving needs of customers, as a result of which we now have winning brands across segments that have been driving volumes. For example, CD Deluxe in the entry segment, Splendor+, Passion Plus, Splendor NXG and Glamour in the deluxe segment and Hunk, CBZ X-treme and Karizma in the premium segment have been our share drivers. We have also been investing on brand building through innovative marketing initiatives by strengthening our association with properties in cricket, entertainment and adventure. These activities have helped us tremendously to connect with the youth and reach out to our target group. All these initiatives have been backed by an aggressive network expansion to reach customers in far-flung corners of the country. We have grown our network from 2,000 a little over two years ago, to over 3,500. Finally, we have also been tapping into the rural and semi-urban markets through our rural programmes. Hero Honda has been saying it can still protect its margins and grow by focusing on rural and semi-urban markets. What are the key pillars of your rural strategy? To what extent would you ascribe your performance to government initiatives in the sector over the last few years? The government did take a number of steps in the right direction to stimulate demand, improve liquidity in the system and contain inflation. The governments stringent controls have also held us in good stead when we compare ourselves to the rest of the world. While the governments stimulus package has resulted in lowering prices of two-wheelers, the industry continues to reel under the pressure of continuing high interest rates and liquidity crunch. The government has also played its role in creating the right environment and stimulate demand in the rural areas through its development schemes such as Bharat Nirman Yojna and NREGS programmes. Consumer demand has also been fuelled by the governments loan waiver, the Sixth Pay Commission and the increase in Central Government Dearness Allowance as this helped boost spending. Do you foresee any major fluctuation in raw material prices over the next couple of quarters? Commodity prices have remained stable in the past two quarters. I expect the trend to continue in the next couple of quarters too. However, it will be interesting to see the commodity price movement from the third quarter onwards. You have a full-fledged launch pipeline ready for the year. How important is product innovation in your overall strategy? Being a customer-centric company, product innovation is of prime importance to us. We have winning brands across segments, which is a contributing factor for our strong performance with 58% share in the domestic two-wheeler market. Our strategy is to keep refreshing the product range and maintain a balanced portfolio across segments. Tell us about your recent launches and the response from the market. We launched nine modelsincluding new products, variants and refreshesacross segments in fiscal 2009. With the new all-muscle Hunk, and a sporty and stylish new CBZ X-treme, we strengthened our market presence in the 150-cc segment. We also introduced self-start in the 100-cc range with our new launch Passion Pro. The power start variants were also introduced in CD Deluxe and Splendor NXG. In addition, we also refreshed our successful models Glamour, Glamour FI, Splendor NXG and Pleasure. The response to all these new launches has been very encouraging. You have announced plans to expand the network of dealership touch points by 500 locations to 4,000 before the year is over. Where do you start and how have you planned the rollout? The expansion of our touch-points is an ongoing process. To support our initiatives, we are aggressively expanding our distribution network. We have grown our network over 50% over the last three years, from 2,000 to over 3,500 now, to significantly expand our reach. This includes authorised dealerships, service and spare-parts outlets, and dealer-appointed outlets across the country, which will now be taken up to 4,000 by the end of this year. Two-wheeler financing, or the lack of it, is a major bugbear of most two-wheeler companies in India. Your comment. The two-wheeler industry has suffered in the past couple of years due to the uncertainty over interest rates and an overall credit squeeze. We have tied up with several regional rural banksGrameen Banksto make financing options available to our customers. At the local level, there have also been tie-ups with co-operative banks for financing. What is the capacity of your new Haridwar plant and how do you expect its commissioning to beef up your performance for 2009-10? We have been steadily increasing production at our Haridwar plant. Currently, the daily output of our Haridwar plant is a little more than 4,000 units per day. The tax benefits accruing from the Haridwar plant have certainly helped our bottomline. Post the launch of the Nano, and even before that, analysts and four-wheeler makers are saying that it is the two-wheeler market that will be hit hard by the Tata car. Whats your view? As we have always maintained, small cars would have a minimal impact on two- wheeler sales in India. The Indian consumer is highly price-conscious and assigns importance to factors such as acquisition costs (cost of acquisition of an entry-level two-wheeler is about one-third of an entry-level small car), fuel cost, maintenance cost and other sundry charges including registration, insurance, parking, toll taxes etc. For the customer, fuel efficiency of the vehicle continues to be a significant influencer in his purchase decision. According to latest estimates, only 23% of urban households and less than 10% of rural households own a two-wheeler. These penetration levels are only a fraction of the levels in other developing South East Asian Countries. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| COMPONENTS Go To Top The Hindu Business Line
In a release, the company said the compressors were engineered on the principle no oil in the compressor system means no oil in the output air from the compressor and used a dry crankcase that was entirely devoid of oil. The internal moving and friction parts were designed to overcome the absence of lubricating oil. http://www.thehindubusinessline.com/2009/06/09/stories/2009060951600300.htm | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ALLIED INDUSTRY Go To Top Amiti Sen The Economic Times
Import at reasonable and concessional fair prices is the need of the hour to protect the consumer against arbitrary pricing by the domestic industry, Mr Singh said. The government has intimated the World Trade Organization (WTO) of its intention to impose safeguard duties on passenger car tyre imports from China. In a submission to the committee on safeguards, the Indian delegation to the WTO stated that imports from China had shown an increase in absolute terms as well as relative to total domestic sales since 2005-06. The share of imports in total sales increased from 2.52% in 2005-06 to 7.29% in October-December 2008. The monthly production and capacity utilisation of the domestic industry also declined during October-December 2008 thereby hurting profitability, the submission added. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved" SC REJECTS MRF WORKERS UNION'S PLEA ON WAGE SETTLEMENT PTI
A Bench headed by Justice B Sudershan Reddy had dismissed as withdrawn a petition filed by the MRF United Workers Union challenging the Madras High Court's interim order that asked the parties to maintain the status quo on a settlement reached between the management and a "puppet union", the MRF Arakonam Workers Welfare Union, on May 8. The Bench refused to intervene in view of the petition coming up for hearing in the High Court tomorrow (June 9). Alleging that their workers along with their families were agitating as they were saddled with one more wage settlement on May 8, the MRF United Workers Union submitted that the employer paid "the permanent workers on a piece-rate basis while extracting work load at impossible levels of production". The counsel told the court that there was no legislation relating to recognition of trade unions in Tamil Nadu. On this the Bench expressed the need for considering amendments to the Trade Union Act, 1934. "It is high time the Government considered amending the Trade Union Act," the Bench observed. Senior advocate Abhishek Singhvi said this is part of the fourth-generation reforms. AMARA RAJA'S ONLINE RACING CONTEST The Hindu Business Line
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| ASSET FINANCING NBFCS REPORT FALL IN PROFIT GROWTH M.V.S. Santosh Kumar The Hindu Business Line
Bajaj Auto Finance, Cholamandalam DBS Finance, Sundaram Finance, M&M Financial Services and Shriram Transport Finance, the five prominent NBFCs, have aggregately seen net profit grow by 32 per cent over FY08. The profit growth in 2006-07 over 2007-08 was 58 per cent. The profit picture may look skewed due to much higher profit growth registered by Shriram (57 per cent) and Bajaj (64 per cent). Barring Chola DBS, none of the NBFCs have seen a decline in profit growth. Disbursement fall While the loan disbursement for Shriram has been flat, others such as Sundaram and Bajaj have a different story to tell. Sundaram experienced an 11 per cent fall in disbursements while Bajaj Auto Finance saw a 19 per cent fall. The high growth in disbursements that NBFCs enjoyed during the earlier boom periods now moderated largely due to the meltdown in the automobile sector. The fortunes of these companies predominantly rested on the auto sector (commercial vehicle, two-wheeler, and three-wheeler) which witnessed significant fall in volumes. Though there was slowdown in disbursements, with falling interest rates these NBFCs managed a reasonable growth of 25 per cent in their net interest income on an average, as the borrowing rates continued to fall more rapidly than the yields made from lending. Asset Quality slips As with their banking cousins, the asset quality of these NBFCs has seen higher slippages last fiscal. For the year ended FY09, Shriram and M&M have seen their gross NPA (non-performing assets) ratio rising by 23 basis points and 110 basis points respectively. Slippages were also seen in Sundarams and Bajajs loan books. NBFCs can take heart from the fact that their portfolio is secured in the form of asset financed by them which would help them limit their credit losses. But provisions for bad debts though grew in the range of 14 per cent and 84 per cent thereby denting the profits. Outlook It is expected that asset quality may get worse before getting better. The automobile slowdown that became pronounced between October 2008 and March 2009 may have negative effects on the NBFCs books for the next couple of quarters. However, the Reserve Banks recent relaxation in asset repossessing norms may benefit the NBFCs. An auto sector revival (supported by encouraging sales data in over the last couple of months) may boost the disbursements of loans.. http://www.thehindubusinessline.com/2009/06/09/stories/2009060950710600.htm | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| LUBRICANTS & ALTERNATIVE FUELS Go To Top Rajeev Jayaswal The Economic Times New Delhi: The government seems set to postpone the problem of freeing up fuel prices, stymied in its attempt to sugar-coat the bitter pill of reform by the sharp run-up in crude oil rates. Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved" http://economictimes.indiatimes.com/Economy/Govt-steps-back-on-oil-decontrol/articleshow/4633690.cms OIL RALLY STALLS; PRICES HOVER AROUND $68 AP See this story in: The Times of India Sioux falls, South Dakota: Oil prices fell on Monday as a four-month rally that has roughly doubled the price of crude lost some steam alongside the stock markets. http://timesofindia.indiatimes.com/Business/Oil-rally-stalls-prices-hover-around-68/articleshow/4632725.cms | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INTERNATIONAL NEWS Go To Top Agencies See this story in: The Economic Times Tokyo: Japans Toyota Motor aims to cut the cost of producing its compact cars by a billion dollars a year, as their demand is likely to grow amid the global recession, a report said on Sunday. has long relied heavily on large and luxury vehicles to drive its profit growth, but demand for small and eco-friendly cars is set to expand significantly, as the global crisis causes consumers to tighten their belts, it said. The company will, therefore, rework its profit structure so it can earn high profits even on small models, the report said. This would also enable the company to aggressively cultivate demand in emerging markets, it added. http://economictimes.indiatimes.com/articleshow/4629135.cms ELECTRIC CARS UNLIKELY TO HIT JAPAN ROADS TILL 2020: REPORTS Reuters See this story in: The Economic Times Tokyo: Japanese automakers may be turning to electric vehicles in the quest for zero emission but it is unlikely that such cars will hit the roads in the next ten years, say reports. AUDI MAY SALES DOWN 6 PER CENT Agencies See this story in: The Economic Times, mint Frankfurt: German carmaker Audi AG said on Monday that its unit sales for May declined 6 per cent, as the recession continued to affect demand, despite strong sales gains in the Asia-Pacific region. http://www.livemint.com/2009/06/08155114/Audi-May-sales-down-6.html BMW SALES FALL 18 PC IN MAY FROM YEAR EARLIER Agencies See this story in: The Economic Times, mint Frankfurt: German carmaker BMW AG said on Monday that the group sold 109,042 cars in May 2008, an 18 per cent decline from the same period a year earlier. The Munich-based premium carmaker said its BMW brand sold 90,643 cars last month, down 18 per cent from the 110,707 sold in May 2008. http://www.livemint.com/2009/06/08161104/BMW-May-sales-fall-18.html BMW, AUDI SAY MAY CAR SALES FELL, BUT LESS SHARPLY Agencies See this story in: The Economic Times Frankfurt: German carmakers BMW AG and Audi AG both said Monday that sales fell in May compared to a year earlier, but noted that the slump in the auto market was not as bad as in previous months. GM TO HALT MEDIUM-DUTY TRUCK PRODUCTION See this story in: Business Standard
"After four years of working with multiple potential buyers, General Motors has decided to wind down its medium-duty truck operations," the automaker said in a statement. GM plans to cease production of Chevrolet Kodiak and GMC Topkick medium-duty trucks by July 31. The automaker sold about 20,000 of the vehicles last year, down from roughly 30,000 in 2007, as the U.S. economy sank into a deep recession. Chief Executive Fritz Henderson told reporters at an event in Warren, Michigan, that the medium-duty truck the business had not been successful for years and workers would be deployed to other facilities or offered an attrition program. GM has moved quickly since it filed for bankruptcy on June 1 to disclose plans for brands and operations not part of its long-term strategy. GM plans a quick sale of its profitable assets by the end of August to a new company. Last week, GM said it had reached preliminary agreements to sell its Saturn brand to dealership group Penske Automotive Group and its Hummer brand to little-known Chinese heavy equipment maker Sichuan Tengzhong Heavy Industrial Machinery. About 400 hourly and salaried workers are involved in the production of the medium-duty trucks at a GM plant in Flint, Michigan, spokesman Jim Hopson said. The Flint plant has more than 2,100 employees overall and also builds light pickup trucks for GM. The automaker plans to continue production of the pickup trucks at the plant. Navistar International Corp had been one of the potential buyers for the GM medium-duty truck operation. GM and Navistar had reached a tentative agreement on a sale, but the pact expired in August 2008 without a deal being reached. DETROIT SUBURBS BECKON FIAT EXECUTIVES WITH $1,595 SANDALS See this story in: Business Standard Some people in Birmingham, Michigan, cant wait for the Italians to take over Chrysler LLC. Karen Daskas, owner of a womens fashion shop called Tender, said she carries Chrissie Morris high-heeled sandals -- original price $1,595; now $795.50 -- that might appeal to Italian expatriates from Fiat SpA. A few doors away, jeweler Gary Astreins said that new blood should bring new jobs to an ailing economy. Next year, students at a local public high school may be able to study Italian. Im preparing to work for the relocation of Fiats executives, said Carolyn Bowen-Keating of Weir Manuel Realtors in Birmingham. Im organizing a presentation of our services at the Italian consulate in Detroit. Bowen-Keating, 57, is trying to win business from the expected arrival of executives from Turin-based Fiat, which would control Chrysler following federal court approval of a sale. Chrysler is based in another Detroit suburb, Auburn Hills. Should the acquisition go as planned, 100 to 200 executives may relocate to Michigan within 18 months, according to Gerald C. Meyers, a professor at the University of Michigan Ross School of Business and a former chairman of American Motors Corp. A Fiat spokesman, Gualberto Ranieri, declined to comment on how many employees might move. Chances are those managers will live in or near Birmingham, population 20,000, if the housing choices of other car industry executives are any guide. During his almost two-year tenure as Chryslers chief executive officer, Robert Nardelli used to stay in Birmingham at the Townsend Hotel. Rick Wagoner, General Motors Corp.s former CEO, lives in the city. His successor, Fritz Henderson, lives a mile away in Bloomfield Hills. Daimler AG CEO Dieter Zetsche lived in Bloomfield Township when he ran the U.S. operations of DaimlerChrysler. Birmingham is in Oakland County, where much of Detroits middle class moved after the citys riots of 1967, said Robin Boyle, professor of urban planning at Wayne State University in Detroit. Birminghams downtown is about 10 miles (16 kilometers) northwest of Detroit, and is within 20 miles of the headquarters of GM, Ford Motor Co. and Chrysler. The place is very green and beautiful and conveniently located for those working in the auto sector, said Stefano Aversa, the Florentine co-president of restructuring firm AlixPartners LLP. The reputation of Detroit and its surroundings is much worse than it deserves. Aversa has lived in Turin and Bloomfield Hills; he said his favorite Italian restaurant in the Detroit area is Il Posto in Southfield. As the worst recession since the Great Depression pushed Chrysler and GM into bankruptcy, the states unemployment rate reached 12.9 percent in April -- the highest in the U.S. -- while national unemployment stood at 8.9 percent, according to data from the Labor Department. Since its peak employment in June 2000, Michigan has lost 520,000 jobs, 65 percent of them in manufacturing. Oakland County has suffered, too. In 2000, it was the 20th- wealthiest county in the U.S., according to Commerce Department data. By 2007, the most recent year for which data is available, Oakland had dropped to 48th place. Astreins, the jeweler, said that around March of that year he noticed a troubling change in his business. Customers began coming in to sell him their gold. In my 35 years in business I have only bought gold during the oil crisis in the 70s and during the first banking crisis in the early 90s, Astreins, 57, said. Both times, the gold- buying business faded when the economy rebounded, he said. Michigan has experience with European car executives moving in. Renault SA of France bought American Motors in the late 1970s, for example, and Germanys Volkswagen AG had its U.S. headquarters in Auburn Hills before relocating last year to Herndon, Virginia. Most recently, German carmaker Daimler bought Chrysler in 1998 for $36 billion. The combined company lasted until August 2007, when Cerberus Capital Management LP bought 80 percent of Chrysler for $7.4 billion. The Detroit area already has a global flavor, said Richard Florida, director of the Martin Prosperity Institute at the Rotman School of Management of the University of Toronto. He said an Italian influx would only make the region more cosmopolitan. Despite the trauma of the Big Threes crisis, Detroit remains the most international auto city in the world, said Florida, 51, whose wife, Rana, is a Birmingham native. It is a small-scale global auto economy. While the DaimlerChrysler deal didnt work out for shareholders, it helped the Detroit area in other ways, according to Boyle, the Wayne State professor. The venture had a positive social impact thanks to the many Germans that moved here, said Boyle, 57, who has lived in Birmingham for the past 17 years and chairs the citys Planning Board. If Fiat will be able to do what Daimler couldnt, the benefits for the U.S. auto industry and the local economy will be huge. Bloomfield Hills International Academy, a public high school established 13 years ago to meet the education needs of foreign arrivals, may offer Italian for its extracurricular program, said Jennifer VanDusen, director of the institutions international center. The school currently teaches French, Spanish, German and Chinese. Fiats deal with Chrysler brought positive attention to the brand and increased Americans awareness of the fact that Fiat is also Maserati and Ferrari, said Nate Wonboy, 40, brand manager at Maseratis dealership in nearby Troy, Michigan. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ECONOMY & FINANCE Go To Top The Hindu Business Line Mumbai: The rupee fell by around 45 paise against the dollar, under pressure due to falling Asian and domestic equity indices, said dealers. The domestic currency opened at 47.30 and strengthened to touch an intra-day high of 47.25. It weakened to touch an intra-day low of 47.73, before recovering to close at 47.56, as against the previous close of 47.11. The rally of the dollar against the euro and the pound in the overseas markets also exerted pressure on the rupee, said a deale r with a public sector bank. In the forward premia market, the six-month premium closed lower at 2.72 per cent (2.84 per cent) and the one-year closed at 2.34 per cent (2.41 per cent). http://www.thehindubusinessline.com/2009/06/09/stories/2009060950730600.htm
The Hindu Business Line Mumbai: After their relentless climb of several weeks, the benchmark indices buckled on Monday, giving in to global cues and profit booking, as well as, some suspected, squaring off of long positions by a few entities recently barred by SEBI. The Sensex fell 2.9 per cent, shedding more than 430 points from its previous close, while the broader Nifty fell 3.4 per cent. The market received a heavy pounding and erased most of last weeks gains as intense selling saw the index shed heavily during intra-day trades, said Mr Gaurav Dua, Head of Research, Sharekhan Ltd. No buying support There was total lack of buying support from both domestic institutions and FIIs; they were net sellers for Rs 876 crore and Rs 14 crore respectively. The markets had been rising steeply and continuously (40 per cent) since March, so there was bound to be a correction, said Mr Vishwas Agarwal, an independent analyst. The rally was a liquidity-driven one, and valuations seemed to have overstepped the fundamentals, he added. The second half of Mondays trading session witnessed heavy selling due to weak European markets and lower US index futures, said brokers. There were unsubstantiated rumours that UBS bank might be facing financial trouble, which also weakened domestic sentiment. There was also a buzz in the market that the 26 entities barred by SEBI from accessing the markets, were squaring off their long positions, leading to selling pressure on stocks. Some of these entities are suspected to be linked with Ketan Parekh. Forex factor With the dollar appreciating against all currencies including the rupee, the global markets including India were down, said Ms Anita Gandhi, Head of Institutional Business, Arihant Capital Markets. More than 800 stocks hit the lower circuit, while 252 stocks touched the upper circuit. The mid-cap and the small-cap indices fell substantially; the BSE-Midcap fell 5.42 per cent and BSE-Small Cap 5.80 per cent. All the sectoral indices on BSE except IT ended the day in the red. http://www.thehindubusinessline.com/2009/06/09/stories/2009060952380100.htm CRISIS-HIT SECTORS SHOULD GET MORE FUNDS: PLAN PANEL Business Standard New Delhi: The Planning Commission is in favour of increasing the governments planned expenditure to support sectors that have been adversely affected by the current economic slowdown. Replying to a question related to the possibility of additional fiscal stimulus measures in the forthcoming Budget, Planning CommissionDeputy Chairman Montek Singh Ahluwalia said: We have started some discussion with the finance ministry. This is related to what should be an appropriate size for planned expenditure for 2009-10. In the interim Budget announced in February this year, the planned expenditure for 2009-10 was budgeted at Rs 2,85,149 crore, which is 4.73 per cent of Indias projected output for the fiscal. Planned expenditure budgeted for 2009-10 in the interim Budget remained almost flat, if compared to the revised estimates of the previous year. But it was an increase of 17.15 per cent, compared with Budget estimates of 2008-09. This was because of increase in planned expenditure on account of the three stimulus packages announced between December 2008 and February 2009. We are looking at the expenditure absorption capacity of different sectors and then making some recommendations, Ahluwalia said in his first interaction with the media, after being re-appointed as the head of the apex plan panel. Supporting the cause of infrastructure funding, the plan panel chief called for review of the cut-off date for refinancing infrastructure projects through the Rs 10,000 crore tax-free bonds raised by Indian Infrastructure Finance Company Ltd (IIFCL). The government had allowed IIFCL to raise the tax-free bonds in December 2008. But the condition was that the funds could be used to refinance infrastructure projects, which have gone for bid after January 31, 2009. The issue came up in a meeting with the Road Transport and Highways Minister Kamal Nath, to which I was invited. Some people felt that the present restriction needs to be reviewed. They are looking at the issue. They will come back to us and the finance ministry. I personally have no objections at looking at a proposal which says that the date can be shifted some days back, he added. Ahluwalia also added that the plan panel will look at possibilities of merging social sector projects for better management. In the previous commission, we had looked at that and made suggestions. This is something that we would do again, he said. On the issue of the mid-term review of the 11th Plan period (2007-12), Ahluwalia said that the plan panel will take in to account the global factors while reviewing the five-year plan. Our objectives do not change. But clearly as part of mid-term appraisal, we will look at whether the external environment which we now face is a temporary event. Or if it implies a significantly different external environment for the rest of the plan period. And if so, what modifications are needed in the plan. http://www.business-standard.com/india/news/crisis-hit-sectors-should-get-more-funds-plan-panel/360509/
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