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| INDUSTRY Govt to implement emission norms INTERVIEWS/FEATURES CARS, SUVs, MUVs Peugeot may drive global compact car into India Nissan looks at sourcing for non-compact cars from India M&M launches new Bolero pick-up Hyundai ad account may be up for grabs COMMERCIAL VEHICLES Volvo expects orders for 600 buses under JNNURM M&M launches new Bolero pick-up Tata Aces 3-wheel cargo mart -- with 4 wheels CONSTRUCTION & AGRI MACHINERY | ALLIED INDUSTRIES OIL, LUBRICANTS & ALTERNATIVE FUELS INTERNATIONAL NEWS Mercedes, Lexus top ranking of US dealerships Nissan, Honda to boost China production capacity Fiat expresses interest in car designer Bertone ECONOMY & FINANCE Sensex surges amid thin volumes 8% growth possible this year, says Kamath
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| INDUSTRY Go To Top Samar Srivastava mint (Web & Print Edition)
New Delhi: After posting steep and steady declines in the second half of last year, rising sales have brought cheer to auto companies in the first six months of 2009, and this is likely to be reflected in the finances of these companies.
As a result, car, truck and two-wheeler makers that begin announcing results later this week are on track to report improved earnings for the quarter ended 30 June, according to analysts.
Still, year-on-year growth for some companies will be lower than what it was during the same period last year, due to a so-called base effect where high numbers in one year result in muted growth the next. Sales started falling from July 2008.
Auto companies have been able to sustain the momentum generated in the fourth quarter (of last fiscal year; January-March of this year), Jatin Chawla, an analyst at IIFL Capital wrote in his earnings preview report. According to him all segments, expect large trucks that the industry terms as heavy commercial vehicles, have registered substantial volume growth as the availability of finance has improved.
Five brokerage firms polled by MintCitigroup Global Markets Inc., India Infoline Ltd, IIFL Capital, Centrum Broking Pvt. Ltd and Angel Broking Ltdalso attribute the improved results to softening commodity prices.
Commodity prices, which peaked in the second quarter of the last fiscal year (July-September 2008), fell steadily in the third quarter. Most companies, however, have said they would only begin to benefit from the decline from the first quarter of this fiscal year (quarter ended June). These savings would result in net profit margins improving by 210 basis points, according to brokerage firm Motilal Oswal Securities Ltd.
A basis point is one-hundredth of a percentage point. However, commodity prices have since started strengthening, which would mean lower margins in the coming quarters. For instance, the price of steel has moved up 11% from $350 a tonne (Rs17,080) in the fourth quarter of the last fiscal year to $390 in the quarter gone by. Raw material bills for auto makers are typically 20% of revenues, with steel accounting for half of that. Prices of another key raw material, copper, have risen 25%.
Market leaders Maruti Suzuki India Ltd (in the passenger car segment) and Hero Honda Motors Ltd (in motorcycles) have outsold their peers in the last three months largely on the back of buoyant demand from rural India.
At least four out of every 10 bikes sold by Hero Honda are bought outside cities. Maruti, which has the countrys largest dealership network of 623 outlets, said that rural sales now make up 9.5% of all cars sold, up from 3.5% a year earlier.
Hero Honda is slated to post robust profits for the June quarter. Analyst estimates put net profit at Rs383.5 crore, up 40% from Rs272 crore in the same period last year. Marutis net profit is likely to be down 26% to Rs341.9 crore because of currency fluctuations. The company had lost Rs121 crore in the fourth quarter of the last fiscal year.
After the impressive performance of auto firms in the first three months of 2009, the 14-share BSE Auto Index has continued to rise. It rose 48.9% in the quarter ended 30 June.
Boosted by its new model Xylo, Mahindra and Mahindra Ltd (M&M) posted a 29% increase in the number of vehicles sold in the quarter ended June. The firm, which sold 35,031 vehicles in this period, could post the highest profit growth among firms surveyed. Net profit for the quarter are expected to increase 70% to Rs266.9 crore.
Companies such as Maruti and M&M also benefited from cheaper financing from banks. In February, State Bank of India, the countrys largest bank, reduced interest rates on car loans to 10%. It followed up last month by reducing rates further to 8% for the first year, and 10% for the second and third years.
Although other banks have not followed suit, analysts say reduced interest rates are likely to keep sales ticking in the coming months.
Falling volumes at the countrys No. 2 motorcycle maker Bajaj Auto Ltd are unlikely to dent profitability as the companys focus on bikes in the executive (or higher-priced) segment may have resulted in improved profitability.
The executive segment is generally defined as bikes costing at least Rs40,000. Net profit for the quarter for Bajaj, which reports results on 16 July, is expected to rise 12% to Rs199.6 crore.
Bajaj recently announced its plans to re-enter the commuter segment. The company plans to launch a 100cc bike, which will be in showrooms by 27 July.
Truck makers Tata Motors Ltd and Ashok Leyland Ltd are likely to report reduced profits as demand for trucks shows no signs of picking up. Tata Motors also makes cars, but trucks contribute to nearly two-thirds of its profits.
Net profit at Tata Motors is expected to halve to Rs124 crore, while Ashok Leyland is likely to post a loss of Rs10 crore for the quarter, according to the five analysts polled. Analysts say the worst is behind the two companies, but are still unsure about when demand for big trucks will improve. http://www.livemint.com/2009/07/14233957/Rising-sales-may-help-auto-fir.html
The Hindu Business Line (Web & Print Edition)
Hyderabad: The first batch of Tata Nano cars produced from the Tata Motors Pantnagar manufacturing base has reportedly landed in Hyderabads Sanathagar rail yard. The stock includes bright red, yellow and pearl silver. Tata Motors has written to its dealers that the first consignment is being despatched and this number would go up as the production is stepped up. Efforts to get some more information from Tata Motors were in vain.
However, a dealer of Tata Motors, Concord e Motors, Mr Hareram Singh, told Business Line that the company had written to them indicating that the first batch is ready for despatch through wagons. While confirming that they were gearing up to receive the cars, he said that it would take couple of days to reach the showrooms in Hyderabad. In the first consignment of 70 vehicles, 56 of them are Nanos and the rest Magic LCVs. http://www.thehindubusinessline.com/2009/07/15/stories/2009071551220200.htm
GOVT TO IMPLEMENT EMISSION NORMS The Hindu Business Line (Web & Print Edition)
New Delhi: With the aim of keeping ambient air quality clean, the Government, on Monday, announced the implementation of emission norms for new and in-use vehicles and fuel quality in accordance with the roadmap of the Auto Fuel Policy. Also an action plan for air quality management is being undertaken in 16 cities. The Minister of State for Environment and Forests, Mr Jairam Ramesh, told Parliament that setting a timeline to meet WHOs Air Quality Guidelines would be difficult.
He added that the ambient air quality is being regularly monitored under the National Air Monitoring Programme by the Central Pollution Control Board along with other State Pollution Control Board and the Pollution Control Committees. http://www.thehindubusinessline.com/2009/07/15/stories/2009071550421700.htm
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| INTERVIEWS/FEATURES Go To Top A year and three months after acquiring British brands, Jaguar and Land Rover, Tata Motors has launched the vehicles in India. It was in April last year that BrandWagon had written about how the company had truly become a force to reckon with in the global arena following the acquisition. It was a tough battle acquiring the brands given that Tata Motors had to convince the Jaguar Land Rover (JLR) management as well as its strong workers union that it was the best bet in the wake of Detroit-based Ford Motors decision to put the company on the block.
Tata Motors clinch ed the deal for a whopping $2.3 billion, but the road has hardly been smooth for the auto major since the acquisition. Indias largest manufacturer of vehicles has had to cut jobs, cut costs at JLR to stay fit. Its consolidated results showed a net loss of Rs 2,505.25 crore for the year ended March 31, 2009, mainly due to the poor showing by JLR. Tata Motors is said to be negotiating with the UK government for financial assistance for the beleaguered company.
Finding new markets then is important for both JLR and its new owner, Tata Motors India. Emerging markets Brazil, Russia and China are important from a growth point of view. JLR has the capacity to produce and India has the capacity to consume. Despite this inherent advantage enjoyed by the Indian market, the way forward is hardly going to be easy for the two brands, especially, for the marquee Jaguar. For consumption to take off in a significant way, the price tag has to be reasonable.
Both the Jaguar and the Land Rover, for the record, are available in the brackets of Rs 63-92 lakh and Rs 63-89 lakh respectively (prices are ex-showroom, Mumbai). Each has three models on offer. The Land Rover has the Discovery 3, Range Rover and Range Rover Sport, while the Jaguar has the XF, XFR and XKR in India. These models are at the mid- (Discovery 3, XF) to high- end (Range Rover, Range Rover Sport, XFR, XKR) of the price and product range of the company.
The Land Rover, by some accounts, may still find a larger customer base especially when it launches its diesel-run, compact SUV Freelander in October this year for a competitive Rs 32 lakh. Bob Grace, director, overseas operations, Land Rover, says, In terms of volumes, we see the Freelander doing significant numbers, followed by the Range Rover Sport, Discovery and Range Rover.
The Jaguars market could be smaller, say some, mirroring what exists worldwide. Globally, it is the Land Rover, which is the volume driver for JLR, and not the Jaguar. But in calendar year 2008, Jaguars wholesale volumes grew 29% over the previous year. Land Rovers volumes, in contrast, came down 19%, according to a report prepared by brokerage firm Anand Rathi.
Retail volumewhich indicates the actual number of vehicles delivered to customerswas also in favour of Jaguar. It grew 8% for the latter in calendar 2008 over 2007, coming down for Land Rover by 21%. Russia and China showed positive growth for both. Retail volumes for Jaguar in Russia and China grew 54.5% and 40% respectively in 2008 over 2007. For Land Rover, it was higher, at 61% and 68%.
So there is hope, say observers. Jaguars customers have been buying it for the brand that it is. That should work. Says Mick Razza, director, overseas operations, Jaguar, Its a beautiful, fast car, technologically superior. This pedigree should hold us in good stead in India.
Pedigree notwithstanding, garnering significant market share may not be easy for Jaguar in India. It will come into the country as a completely built unit (CBU)so will the Land Roverwhich increases the incidence of tax on it. On CBUs, duties and taxes are a whopping 114% in comparison to completely knocked-down (CKD) units, where the incidence of tax is about 55%. There lies the catch. The price tag shoots up because of the high incidence of tax on the vehicle.
For any meaningful presence then in the domestic market manufacturing or assembling locally is imperative. International luxury car makers operating in India have realised this. Says Peter Kronschnabl, president, BMW India, For a serious play in the luxury car market, you have to have the ability to produce locally.
And to justify local production an aggressive push in terms of sales is important. At about 7,400 units, the luxury car market is a fraction of the 1.2-million-unit passenger car market in India. The Society of Indian Automobile Manufacturers pegs both the premium and luxury end of the market at about 9,069 units, that is, 8,313 units for the premium end (A5) and 756 for the luxury end (A6). This is the size of the market at the end of the last financial year. It only shows how small the base is, points out an analyst. Though the luxury car market has been growing at 20-25% for the last few years, the overall base is not likely to be huge. This presents an opportunity as well as a challenge for players. The opportunity: To grow the market by pushing aggressively in terms of sales. The challenge: To do so without compro- mising on brand equity.
Players in the segment seemed to have learnt how to do so quite effectively. Its a question of marrying aspiration and price perception, says an executive at Mercedes-Benz. Its also about having a healthy mix of products that straddle the price-value equation.
The big threeAudi, BMW and Mercedes-Benzare doing this with a mix of CKDs and CBUs in their product portfolios. For instance, Audis CKD models include the A4 and A6. BMWs CKD models are the 3 and 5 series, while Mercedes-Benzs CKD models include the C, E and S class vehicles.
Typically, the CKD models are volume drivers with the companies in a position to adjust price with market reality quite effectively. For instance, the C class Mercedes Benz is available in the Rs 25-34 lakh bracket, going up to about Rs 30 lakh. The E class has a price tag of Rs 38-39 lakh going up to about Rs 44 lakh. The S class has a price tag of Rs 74-79 lakh. A CBU variant of the S class is also available Rs 90 lakh onwards (all prices are ex-showroom, Mumbai). Says Wilfried Aulbur, managing director and chief executive officer, Mercedes-Benz India, The cost of ownership is competitive that way. It helps in customer acquisition.
Arch-rival BMW is not far behind in the price game. The 3 series, for instance, is available for Rs 27-33 lakh. The 5 series is priced at Rs 36-46 lakh, while the 7 series has a price tag of about Rs 77-93 lakh (prices are ex-showroom). Product-wise, the Jaguar falls between the 3 and 5 series, says Kronschnabl of BMW. But price-wise, it falls more or less in the 7 series. That makes it a bit steep in my view.
For Tata Motors to make headway in the luxury car market it is imperative for the company to switch to a CKD model for some variants at least at some stage, say observers. For that, the company would need sales of about 1,000 units for Jaguar and Land Rover each, says Abdul Majeed, auto analyst, PricewaterhouseCoopers. That will take time.
Though details about the brand building exercise for the Jaguar and Land Rover are not clear, Rohit Suri, head, premier car division, Tata Motors, says it will be in line with the worldwide positioning of the two vehicles. Jaguar stands for beautiful fast cars, while Land Rover epitomises authentic 4x4s that define premiumness, luxury and breadth of capability in their segments. Advertising will be appropriate to the brands positioning, he says.
At the moment the company has one showroom in Mumbai to showcase the two brands. Plans include extending the network to other cities in the coming months. Our focus in the initial phase is to establish the brands appropriately rather than push volumes, adds Suri. http://www.financialexpress.com/news/a-new-journey/488928/0
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| CARS, SUVs, MUVs Go To Top PTI See this story in: The Hindu Business Line (Web Edition)
Kochi: General Motors (GM) India on Tuesday said its proposed mini car, to be launched by this year end, would be exported after meeting the domestic demand.
Post 2011, there are plans to export the mini car after meeting the domestic demand, company Vice-President, Mr Ankush Arora said here after launching the LPG version of the Chevrolet Spark in the Kerala market.
Though countries to where the mini car was likely to be exported had not yet been identified, about 15 per cent of the volume was expected to be exported, he said. He also said the luxury sedan Chevrolet Cuize was likely to hit the market by coming September and a slew of other products were also slated for launch this year. http://www.thehindubusinessline.com/blnus/02141710.htm
PEUGEOT MAY DRIVE GLOBAL COMPACT CAR INTO INDIA Murali Gopalan The Hindu Business Line (Web & Print Edition)
Mumbai: PSA Peugeot Citroen is believed to be working on a global sub-compact car, which could make its way into India. According to top sources, the car is also being planned for Brazil, China and Iran as part of a strategy that will help the French company explore geographies beyond Europe. Russia and Turkey could join the list at a later stage.
The car is tipped to initially make an entry in Brazil and Iran sometime in 2012, followed by China and India. Interestingly, bigger numbers have been planned for Iran and China at over one lakh units annually, while they are reportedly more modest in the case of India and Brazil.
The PSA group would rather take one step at a time. It is not easy to go flat out when it is just beginning to appreciate the importance of going global, sources say.
The car could either sport a Peugeot or Citroen badge depending on the markets concerned. Indications are that there could be more variants rolling out once things are in place.
Developing markets The BRIC (Brazil, Russia, India and China) economies are increasingly being perceived as critical growth drivers for multinational car companies facing shrinking markets back home be it in Europe, North America or Japan. This explains why the likes of Toyota and Honda have jumped onto the global small car bandwagon in a big way targeting these countries.
Europe could also be on the PSA groups radar because there is no reason why a smart, compact car should not find a market in this part of the world. Even Fiat is looking at a low-cost car here, though it will have a different badge (read as non-Fiat), sources said. Peugeot, which had disastrous innings in India way back in the mid-1990s, is now planning a comeback to the country, though a final decision will be taken only by October this year. Once it identifies the site, reportedly a toss-up between Tamil Nadu and Andhra Pradesh, the plant could be commissioned sometime in mid-2011. However, sources say that the global car is not likely to make its debut here at least till 2013, which means the company could look at a business model that comprises a mix of direct imports and assembly of kits.
Building the brand Peugeot could end up kicking off operations in a small way initially, which will give it time to gauge market response, build its brand and then think of a mass volumes model. This is what companies like Skoda have achieved successfully in India, they added.
In Peugeots case, the pressure is possibly greater because things went wrong after it had first set up business here in 1994. There were labour issues in the Kalyan plant near Mumbai and one thing led to another before it finally called it quits in end-1997. The move did not go down well with most of its associates (customers, dealers, suppliers, financiers etc) who felt that the company had let them down.
Peugeot later attempted to join hands with the Tatas to manufacture the 307 in India. When that plan fell through, it looked as if the company was not going to come back in a hurry. However, the realities of the world market have decided otherwise and Peugeot would now keep its fingers crossed for a better second innings in India. http://www.thehindubusinessline.com/2009/07/15/stories/2009071551210200.htm
NISSAN LOOKS AT SOURCING FOR NON-COMPACT CARS FROM INDIA The Economic Times (Web Edition) See similar story in: The Hindu (Web & Print Edition)
Chennai: Nissan Motor India is steadily progressing on its business plans in India be it sourcing, hiring or identifying production bases. Even for the non-compact car segment, the Japanese auto major has found India to be an attractive and cost-effective sourcing point, according to company officials. http://www.hindu.com/2009/07/15/stories/2009071553501300.htm
M&M LAUNCHES NEW BOLERO PICK-UP The Hindu Business Line (Web & Print Edition),
Pune: Mahindra and Mahindra Ltd launched the pick-up version of the popular SUV Bolero in Pune and will roll out the small commercial vehicle across India in the coming weeks.
Launching the Bolero MaxiTruck, Mr Vivek Nayer, Senior Vice-President (Marketing), Automotive Sector, M&M, said the new vehicle will replace the MaXX MaxiTruck, the existing offering in the same segment. The MMT will be phased out in a month or so, he said. The MMT will be phased out in a month or so, he said.
The new product has been priced at Rs 3.52 lakh (ex-showroom, Pune).
Amongst the features of the new product are micro hybrid technology for greater fuel efficiency, a 2,500 cc, 61 HP engine. It has a 1-tonne payload, top speed of 100 km/hour and a turning radius of 6.6 m, and will be manufactured at Kandivli. A CNG version of the same is on the cards and will be introduced into the market, shortly.
Mr Nayer said that the Bolero pick-up has been positioned just above the Tata Ace, and will be ideal for customers who want to upgrade. After Pune, launches have been scheduled in Tamil Nadu, Uttar Pradesh, Rajasthan, Andhra Pradesh, Gujarat and West Bengal, and the vehicle will be available pan-India through 350 sales outlets, he added. Elaborating on the pick-up market in India, Mr Vijay Nakra, Senior General Manager (Sales), for the western and central regions said that it stood at 16,000 units and Maharashtra accounted for 16 per cent of M&Ms all India sales. He added that the company had a market share of 87 per cent in the one-tonne segment. http://www.thehindubusinessline.com/2009/07/15/stories/2009071551250200.htm
HYUNDAI AD ACCOUNT MAY BE UP FOR GRABS Ratna Bhushan The Economic Times (Delhi Print Edition)
New Delhi: Hyundai Motor Indias (HMIL) media buying and planning account may be up for grabs as its South Korean parent, Hyundai Motor Co, has invited a $1-billion media pitch across the 170 countries where it has a presence. Agencies from the Interpublic, Publicis Groupe and Omnicom groups are expected to pitch for the account. HMIL, the countrys second-largest car maker, is also the No. 2 car advertiser with an annual ad spend estimated at over Rs 100 crore. Zenith Optimedia has been handling its mediabuying business in India since mid-2006. Currently, we do not have an official comment on the Hyundai global media review. We are waiting to hear from our global office, said Navin Khemka, senior vice-president at Zenith Optimedia. There is a global pitch to consolidate Hyundai and Kia. In all probability, Zenith will continue to be on board, a Hyundai spokesperson said in response to an ET query. HMIL refused to give an estimate of the size of its business with Zenith Optimedia. The company markets 54 variants of its cars across segments in India and abroad. Hyundai was a significant advertiser in the recently-concluded IPL. The account review is being managed by Innocean, the inhouse marketing services department at Hyundai Kia, South Korea. The automaker plans to put the new agencies in place by January 2010. Under pressure from slowing demand in developed markets, companies across sectors are setting stringent targets for their creative and media agencies. For instance, Unilever recently called for a media review across 13 countries, including India. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved"
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| COMMERCIAL VEHICLES Go To Top Yogima Seth The Financial Express (Web & Print Edition)
New Delhi: At a time when the truck industry in the country is already reeling under the pressure of economic slowdown, uneven monsoons have played a spoilsport for the industry. With scanty rainfall across most parts of the country, especially the rural belts of Punjab and Uttar Pradesh, the cargo movement has dropped by 20-30% in the last fortnight and this is expected to have a rippling effect on sales of trucks despite the huge investment announced by the government in infrastructure projects in the Budget.
The companies thus affected would be major truck manufacturers like Tata Motors, Ashok Leyland, Eicher Motors and Asia Motor Works.
Though there has been a significant increase in allocation for infrastructure projects and development of national highways in the Budget, it is expected that truck sales would not rebounce at least for the next two quarters because of scanty rainfall, said Indian Foundation of Transport Research and Training (IFTRT) senior fellow and coordinator SP Singh.
According to Singh, 40% of the total cargo revenue of approximately Rs 3,25,000 crore a year comes from transport of agriculture products and since the crop has failed to meet expectations, there has been a 20-30% drop in the cargo movement across the country. This is impacting the demand for trucks in India and may eventually result in another dismal quarter for the truck industry.
Moreover, the weak monsoon and consequent sowing of lesser area by farmers has opened a big opportunity to hoarding of essential food items by wholesalers and this has led to a drop in cargo offering to truckers, added Singh.
According to IFTRT, total truck sales in the country declined by 38.2% in the first quarter (April-June) at 36,248 units as compared to 58,681 units during the corresponding period last year. Currently, there are 4.4 million trucks in the country out of which 17 lakh ply on national permits every day.
This comes on the backdrop of 6% reduction in excise duty in December last year, 50% depreciation allowances announced in the stimulus package in January and 23% increase in allocation under the National Highway Authority of India (NHAI). http://www.financialexpress.com/news/irregular-monsoon-puts-up-roadblock-for-truck-industry/489270/
VOLVO EXPECTS ORDERS FOR 600 BUSES UNDER JNNURM Manu P. Toms The Hindu Business Line (Web & Print Edition)
Mumbai: Volvo Buses India expects orders for 600 buses from various municipal corporations under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM). The company has received orders for 400 buses from Bangalore, Kolkata, Chennai, Pune, Hyderabad, Kochi, Thiruvananthapuram, Mysore and Navi Mumbai. This does not include orders for another 200 inter-city luxury coaches from various State transport corporations and private bus operators.
We began delivering buses to city corporations from March. All the 400 buses will be delivered by December, Mr Akash Passey, Managing Director, Volvo Buses India, told Business Line. The combined order for buses of the 60 select city municipal corporations under the JNNURM scheme would be 15,000 units.
The requirement of premium low-floor buses would be around 800 units and we hope to capture a major share of this market. The city bus tenders are not over yet, he said. Volvo buses, which operate largely in the inter-city luxury and low-floor city segments, cost around Rs 80 lakh per unit while the low-floor air-conditioned buses from Chinese manufacturer, King Long, and Tata-Marcopolo are in the range of Rs 50-55 lakh. Mr Passey said that the company would eventually enter the less pricey medium level of the premium segment in 3-5 years.
The initial plan is to launch buses which cost in the range of Rs 45-60 lakh. This is aimed at catering to a wider market where many of its competitors are present.
Volvo delivered 20 buses to the Navi Mumbai Municipal Corporation on Tuesday. Thanks to more city bus orders, the company has upped capacity at its Bangalore plant to 600 units this year. It posted a 100 per cent growth in sales at 400 units last year and expects a 30-35 per cent growth this year. http://www.thehindubusinessline.com/2009/07/15/stories/2009071551150200.htm
M&M LAUNCHES NEW BOLERO PICK-UP The Hindu Business Line (Web & Print Edition), The Economic Times (Delhi Print Edition)
Pune: Mahindra and Mahindra Ltd launched the pick-up version of the popular SUV Bolero in Pune and will roll out the small commercial vehicle across India in the coming weeks.
Launching the Bolero MaxiTruck, Mr Vivek Nayer, Senior Vice-President (Marketing), Automotive Sector, M&M, said the new vehicle will replace the MaXX MaxiTruck, the existing offering in the same segment. The MMT will be phased out in a month or so, he said. The MMT will be phased out in a month or so, he said.
The new product has been priced at Rs 3.52 lakh (ex-showroom, Pune).
Amongst the features of the new product are micro hybrid technology for greater fuel efficiency, a 2,500 cc, 61 HP engine. It has a 1-tonne payload, top speed of 100 km/hour and a turning radius of 6.6 m, and will be manufactured at Kandivli. A CNG version of the same is on the cards and will be introduced into the market, shortly.
Mr Nayer said that the Bolero pick-up has been positioned just above the Tata Ace, and will be ideal for customers who want to upgrade. After Pune, launches have been scheduled in Tamil Nadu, Uttar Pradesh, Rajasthan, Andhra Pradesh, Gujarat and West Bengal, and the vehicle will be available pan-India through 350 sales outlets, he added. Elaborating on the pick-up market in India, Mr Vijay Nakra, Senior General Manager (Sales), for the western and central regions said that it stood at 16,000 units and Maharashtra accounted for 16 per cent of M&Ms all India sales. He added that the company had a market share of 87 per cent in the one-tonne segment. http://www.thehindubusinessline.com/2009/07/15/stories/2009071551250200.htm
TATA ACES 3-WHEEL CARGO MART -- WITH 4 WHEELS Neha Rishi Daily News & Analysis (Web Edition)
Mumbai: The three-wheeler market, segmented into goods and passenger carriers, has had a mixed run of late. While the goods or cargo business sales have dropped around 20% in the first quarter, the passenger segment is up about 8%. The reason, says Ramesh Maheshwari, chief operating officer (commercial vehicles), Bajaj Auto, is the launch of Tata Ace (a sub 1 tonne four-wheeler).
"The Ace has eaten into the share of the 0.75 and 0.5 tonne three-wheelers. This has added to the trouble caused by the already limping economy, which has affected cargo movement," he said.
While Bajaj is now concentrating more on the passenger carrier segment, Piaggio, which has a strong foothold in the cargo segment, is holding on to its 50%-plus market share. Rajesh Gupta, head (marketing), Piaggio, said, "We have been able to sustain our numbers whereas Bajaj and M&M have slipped drastically, selling only about 4-5 vehicles a month in some states".
He also admitted that the entry of Ace has hurt. "Tata had heavily invested in a lucrative exchange scheme, where you could exchange your three-wheeler for an Ace. Also, financers are reluctant when it comes to three-wheeler loans. This is again where the Ace scores due to easy finance availability for it."
Gupta pointed out that the cargo segment is also suffering because companies have not been able to generate first-time users. "We are trying to penetrate into the rural areas to generate first-time users. Though Ace is eating into our share, and the first time users in the sub-1 tonne category are very high (almost 60%), the cargo segment cannot be replaced because of the economy in operations and the low purchase price," he said. But an analyst with a domestic research firm felt otherwise. "In the goods segment, three-wheelers will continue to struggle in FY10 due to the superior product positioning of the Ace."
However, Bajaj Auto has been able to improve its market share in the passenger segment in the past few months. Maheshwari said, "Overall, we have grown by 24% in the first quarter, whereas the industry has grown only 8%. This growth comes from our passenger carriers (in -city) and diesel vehicles."
The incremental volumes have come due to fresh issue of permits in Mumbai, Delhi and Kolkata. However, Bajaj, which has monopoly in the in-city passenger carriers with a 92% market share, will soon face competition from Piaggio's petrol-base passenger carrier, which will be launched in a month. TVS King also competes in this space. Maheshwari underplays the permit issue and does not attribute the spurt in demand to the same. "Increase in volume is due to replacement demand and new demand that has been created by our new product, which runs on GDi technology that gives 33% more fuel efficiency than a LPG or CNG-driven vehicle," he said. http://www.dnaindia.com/money/report_tata-aces-3-wheel-cargo-mart-with-4-wheels_1274107
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| CONSTRUCTION & AGRI MACHINERY Go To Top The Hindu Chennai: Ashok Leyland and John Deere Construction & Forestry Company have completed all legal formalities for the formation of the 50:50 joint venture company, Ashok Leyland John Deere Construction Equipment Private Ltd. The venture will initially manufacture backhoes and wheel loaders and will market backhoes, wheel loaders and excavators in India and abroad. The range will subsequently be expanded to include a full line of construction equipment, according to a release. http://www.hindu.com/2009/07/15/stories/2009071560351800.htm
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| 2/3 WHEELERS Go To Top | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| COMPONENTS Go To Top | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ALLIED INDUSTRY Go To Top | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| FINANCE & INSURANCE Go To Top PTI See this story in: The Hindu Business Line, Mint
New Delhi: Private sector lender IndusInd Bank on Tuesday said it has entered into a tie-up with the car maker Maruti Suzuki India for financing vehicles.
As per the agreement, Maruti Suzuki India has nominated IndusInd Bank as its preferred financier for financing all Maruti vehicles. IndusInd Bank will offer financing facilities to all eligible customers for purchasing Maruti vehicles through its networ k of 180 branches spread over 147 geographical locations,'' IndusInd Bank said in a statement.
This strategic alliance is part of our expansion strategy in the consumer finance segment...We see excellent synergy in this relationship for both organisations,'' IndusInd Bank Executive Vice President (Consumer Finance Division) Mr S V Parthasarathy s aid. We have the right products and a nationwide sales and services network to support this growth...We are confident that with partners like IndusInd Bank we will win customer confidence and achieve the objective of greater penetration,'' Maruti Suzuki Indi a Chief General Manager Mr R S Kalsi said. http://www.thehindubusinessline.com/blnus/17141091.htm http://www.livemint.com/2009/07/14131659/IndusInd-Bank-ties-up-with-Mar.html
HONDA SIEL IN PACT WITH BOB See this story in: The Tribune
Chandigarh: Honda Siel Cars India has signed a MoU with Bank of Baroda for financing their cars across the country. The bank will offer loans at of 10.5-11 per cent. This facility will be available at all the branches of the bank and 103 facilities of Honda Siel Cars India. http://www.tribuneindia.com/2009/20090715/biz.htm
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| OIL, LUBRICANTS & ALTERNATIVE FUELS Go To Top PTI See this story in: The Tribune
New Delhi: The government will cut petrol and diesel prices if international oil rates stabilise at lower levels, Petroleum Minister Murli Deora said.
"The Parliament is in session and I don't want to say anything outside the House which I haven't said in Parliament," Deora told reporters here.
"I had said in Parliament that we will reduce petrol and diesel prices if international crude oil prices were to stabilise at lower rates. I stand by that statement," he said. He, however, refused to say what level of crude oil prices would trigger a price cut.
Prices at lower levels will have to stabilise for four to six weeks, a Petroleum Ministry official said. The government had earlier this month raised petrol and diesel prices citing spike in international crude oil prices to $70 a barrel.
International rates have eased since. The basket of crude oil India buys was at $59.81 a barrel yesterday but the average for July was $63.65 per barrel. The July average was certainly lower than $69.12 a barrel average price of Indian basket of crude for June. http://www.tribuneindia.com/2009/20090715/biz.htm#6
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| INTERNATIONAL NEWS Go To Top Agencies See this story in: The Economic Times
Frankfurt: German auto maker Audi, which turns 100 on Thursday, has visions of becoming the world's leading luxury car producer despite friction between its parent company Volkswagen and VW shareholder Porsche.
It was the arrival of Ferdinand Piech as Audi's technical development director in 1974 that completed the company's transformation into a "technically innovative manufacturer," the group says.
MERCEDES, LEXUS TOP RANKING OF US DEALERSHIPS Reuters See this story in: The Economic Times
Detroit: Daimler AG's Mercedes and Toyota Motor Co's luxury Lexus brand topped a ranking intended to measure how well US car shoppers were treated in dealer showrooms whether they bought a new car or not.
NISSAN, HONDA TO BOOST CHINA PRODUCTION CAPACITY Reuters See this story in: mint
Tokyo: Nissan Motor Co and Honda Motor Co plan to boost production capacity in China to tap brisk demand in the country, which overtook the United States as the worlds biggest auto market in first half of this year.
Nissan, Japans third-largest carmaker and 44% owned by Frances Renault SA, said on Tuesday it will boost production at its joint venture Dongfeng Motor Co by about 20% to around 560,000 units a year from October.
Shares of Nissan surged 7.7% to 547 on the news. Nissan will add 1,200 workers and operate three shifts a day, up from two now, at the ventures main factory in the city of Guangzhou, a Nissan spokesman said. The automaker does not plan to add or upgrade facilities. The Guangzhou plant will be able to roll out 460,000 units a year, up from 360,000. The automaker does not plan to increase capacity at a separate plant in Hubei province, which can roll out 100,000 vehicles a year, he said.
Honda, Japans No.2 automaker, said its joint venture Dongfeng Honda Automobile Co will lift annual capacity at a plant in Hubei to 200,000 units by the end of this month from 165,000 units.
That would bring Hondas total production capacity in China to 610,000 units. The venture will add new equipment to enhance automation at the Hubei plant as well as more workers. The Hubei plant is capable of building 240,000 units, and Honda will consider expanding production to that level if demand warrants it, he said. Hondas shares gained 1.5 percent to 2,405. The benchmark Nikkei was up 2.2%. http://www.livemint.com/2009/07/14093729/Nissan-Honda-to-boost-China-p.html
FIAT EXPRESSES INTEREST IN CAR DESIGNER BERTONE Reuters See this story in: The Economic Times
Milan: Fiat has expressed interest in iconic car designer Bertone, which is in special administration, the Italian car maker said on Tuesday. Bertone's car design arm was put in special administration -- which protects a company from creditors rather like U.S. Chapter 11 proceedings -- in 2008. Italian media has reported several offers for the company in recent weeks. Bertone, which has designed cars for Fiat and Opel, still has over 1,000 employees. "We have submitted a manifestation of interest," a Fiat spokesman said. http://economictimes.indiatimes.com/News/International-Business/Fiat-expresses-interest-in-car-designer-Bertone-/articleshow/4777304.cms
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| ECONOMY & FINANCE Go To Top The Hindu Business Line
Mumbai: The rupee gained marginally by 12 paise against the dollar on Tuesday, in a range-bound market. The domestic currency opened at 48.83 and strengthened to touch an intra-day high of 48.76. It weakened to close at 48.96, as against the previous close of 49.08/10. In the overseas markets, the dollar weakened against other major currencies. In the forward premia market, the six month ended at 2.34 per cent (2.32 per cent) and the one-year closed at 2.18 per cent (2.25 per cen t). http://www.thehindubusinessline.com/2009/07/15/stories/2009071550820600.htm
SENSEX SURGES AMID THIN VOLUMES The Hindu Business Line
Mumbai: After falling close to ten per cent since the Union Budget, the benchmark indices surged more than three per cent on Tuesday, the highest they have risen in more than a month.
The Sensex rose 453 points to close at 13854 and the Nifty by 3.46 per cent at 4111. Analysts attributed it to a combination of good global markets and domestic short-covering. The Dow, Hang Seng, Nikkei, FTSE and CAC were all trading positive.
But volumes were thin, showing that it was not a conviction-based rally but a technical bounce back, said Mr Jagannadham Thunuguntla, Equity Head at SMC Capital: After the bearish mood of the whole of last week, there was a lot of covering of short positions as the markets were trading at low levels.
After selling relentlessly since the Budget, foreign institutional investors turned net buyers, but for a modest Rs 87 crore; domestic institutional investors were net buyers for Rs 200 crore. The rally was led by the realty scrips; on the BSE the realty index jumped more than nine per cent. This was followed by the metal and consumer durables indices. DLF was the top gainer among the Sensex scrips, rising a whopping 11.44 per cent. Reliance Infrastructure, Jaiprakash Associates and ICICI Bank were also among the top gainers. HDFC Bank was the sole loser in the Sensex pack.
The market breadth was positive as 1,956 scrips advanced and 602 declined.. Market men also said that the possibility of the monsoon picking up could have added to the surge in the markets. http://www.thehindubusinessline.com/2009/07/15/stories/2009071552410100.htm
8% GROWTH POSSIBLE THIS YEAR, SAYS KAMATH PTI See this story in: The Hindu Business Line
Mumbai: India's economic growth is likely to be at least eight per cent in 2009-10, ICICI Bank Chairman K V Kamath said on Tuesday. I expect that the economy will grow at a minimum of eight per cent in FY 10 and then may get on to the targeted growth of 9 and 10 per cent (in the coming years),'' ICICI Bank Chairman Mr K V Kamath said at a meeting here on Tuesday.
Domestic consumption and investment would continue to drive the Indian economy, Mr Kamath said, adding that the country would be on a high-growth trajectory in the next 15-20 years. Mr Kamath also said that liquidity is sufficient in the system. According to him, market forces will decide the interest rate regime.
Asked whether the reserve currency would change from the US dollar to the Chinese yuan, Mr Kamath said that he does not expect this to happen. http://www.thehindubusinessline.com/blnus/01141495.htm
Last Financial closing
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Tuesday, July 14, 2009
INDIAN AUTOMOBILE INDUSTRY NEWS
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