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| INDUSTRY INTERVIEWS/FEATURES CARS, SUVs, MUVs Toyota Motor launches SUV Fortuner Toyota mulls small car launch under Daihatsu brand Toyota plans 'strategic' small car to push sales GM India bets big on planned mini-car Nissan on the fast track with India car plan Fiat India closes syndication for Rs 2,500-crore credit lines COMMERCIAL VEHICLES COMPONENTS Unido to launch projects for cluster development in India
| ALLIED INDUSTRIES FINANCE & INSURANCE OIL, LUBRICANTS & ALTERNATIVE FUELS Oil prices gain to above $74 on recovery hopes INTERNATIONAL NEWS GM trying to develop financing to keep Opel: Report US government to leave Opel choice to GM Toyota recalls 6.9 lakh cars in China ECONOMY & FINANCE Sensex up for 3rd straight day; FIIs stay invested Fiscal deficit wont exceed 6.8% target: Montek
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| INDUSTRY Go To Top Sumant Banerji Hindustan Times New Delhi: After nearly 10 months that put a local downturn and a global slowdown in a double whammy that hurt consumer mood, the automobile industry is gearing up for an onslaught of demand in the festive season beginning September.
All major car and two wheeler manufacturers, Maruti Suzuki India Ltd, Hyundai Motor India, Honda Siel Cars, Hero Honda, Bajaj, TVS and Honda Motorcycle and Scooters, are ramping up production next month. Some like Maruti and Hyundai are doing it in anticipation of higher demand during Dussehra and Diwali, while others like Honda are also looking at clearing the backlog of some of their new launches.
"The increased production will clear backlog of our new models like the Jazz and new City," said Jnaneshwar Sen, vice-president, marketing, Honda Siel Cars India. Honda currently produces 180-200 cars a day and with the second shift it will go up to over 300 cars a day.
Hyundai has already re-started third shift in the first plant on July 10 while the same would be done in the second plant from September 14 onwards.
The company will roll out 400 cars extra per day from mid-September from its current capacity of 2,000 a day.
Maruti Suzuki India Ltd has scaled up production at its Manesar plant to feed demand for the Swift and Dzire models. Two-wheeler manufacturers like Hero Honda, Bajaj and TVS are also expanding capacities.
"The financing situation has improved and we are on the other side of the hill," said Venu Srinivasan, CMD, TVS.
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| INTERVIEWS/FEATURES Go To Top New Delhi: Car makers the world over are in a fix how to get customers back to their showrooms. The liquidity crunch, depressed stock markets and fears of joblessness have dented consumer sentiment badly, though there seems to be a recovery of sorts in India. Synovate Motoresearch, the automotive research division of Synovate, the global market research company, has come out with its Tipping Point Study which seeks to address these concerns of automobile makers. Undertaken in 16 countries including India, the study tries to understand the current psyche of the customer and what can automobile makers do to address it. In India, it was carried out at two locations, New Delhi and Bangalore, in the month of May. Richard Rice, the global director of Synovate Motoresearch, spoke to Bhupesh Bhandari on what should be the road ahead for automobile companies. Edited excerpts:
Your survey talks about how to get customers back to the showrooms. How?
But what we see in India is not a recession but a slowdown. Exactly. And that is where the difference in India has emerged from all the 16 different markets we have done. In India, customers have been less affected but nevertheless they have been affected. And we have seen some shifts in their behaviour and some shifts in how they will buy in the future. On the most conservative and negative side is the person who has said that I am actually worried about things, I am confused, I am hearing words like slowdown and is therefore delaying his purchase. All the other household expenses are also changing.
The next group is on the optimistic side of it and they are more cautious as opposed to confused. They have got a good view of the market and pretty much know whats going on. And they are just hedging their bets. They are buying brands instead of superbrands. They will still buy vehicles but they could come down a segment or two and compromise on specifications. They are probably saving more than they used to. The cautious attitude is coming through.
The third group is what we call the entrepreneurs. They are the people who see the whole thing as somewhat of a challenge. They are optimistic and dont see the impact of the downturn lasting that long or having as big an impact on them. These are not just the wealthy but the trait runs right across the pool. These are people who see it as an opportunity to change things and are willing to take risks. All the three are looking at motor car purchase differently and therefore the type of link that you need to make with each group is different. The one thing that overrides, though low key in India, is the very high level of resentment towards motor manufacturers at last you have got your just rewards; you have been making far too much money for far too long and have not listened to the consumer and now look whats happened to you. Consequently, a lot of manufacturers have cut their prices in other markets and the customers have said thats not the answers we are looking for that just tells us that you were making far too much money in the first place. In India, theres less of that but there is a swing towards the concept of trust, more so on the local brands. What has happened in India is a sense of allegiance to local homegrown brands. A little bit of skepticism is there about some of the other brands which are coming to the market or have been in the market for some time. Very often, people look at a -Indian brand but may finally get back to an Indian brand.
But there are only two local car makers: Tata and Mahindra.
If you look at the latest sale numbers of Indian car companies, they look quite robust. All companies have reported good growth in July. There doesnt seem to be much of a crisis here.
The monsoons havent come the way they were anticipated. We have seen that vehicle sale growth that has been achieved in the last four to six months has been more in the rural areas than in the cities. So that is the market that is currently under threat and thats where this kind of behaviour could well start to come into play once again. The other shift we have seen is that though volumes have gone up, the model mix has changed dramatically. People are switching from mid-segment volumes to low-segment volumes.
So how do you get customers to the showrooms?
In the Indian market, it is more around good value for money. It is what I am getting vis--vis what I am paying and not about just what I am paying. And what I am getting is not just the product it is also the service and the brand. Customers in India are looking for businesses that are confident and bold but not too daring, who are bringing out new products. On top of that, what matters is how you structure your offering.
So, it is the brand that matters. In a crisis, you turn to your family. Brands are like that. The minute you feel a little bit unconfident, you move close to the brand you know. One thing that has happened abroad, and not in India, is that huge brands have simply disappeared overnight. Companies need to tell customers they are here to stay. Dont close dealers, make sure your parts are available and its business as usual. Pay all your suppliers early. Its a powerful message to the market that there is cash in the bank. Thats the kind of activity that Indian customers expect bold, confident but not extravagant. The value-for-money equation has moved very strongly to the value space. Value incorporates product quality and reliability, dealer accessibility and availability, parts availability, technical knowledge and the ability to repair the vehicle in the first go. In many cases, it is a good thing for manufacturers to experience a short downturn because sales people are forced to worry about their customers and deliver good service.
In that case, you could expect Maruti Suzuki to increase its market share further because it is a brand that is trusted the most? It could well increase its market share further. Its business is loaded towards compact cars. However, in a downturn, people who are looking at not buying or people who dont get loans from banks would be at the bottom end.
So, what are the key takeaways of your study? Manufacturers have for the last decade done all the talking. Now is the time to listen. The world is changing very rapidly. You need to have your ear on the pulse of the customer. Companies have created a lot of expectations. They have 100 per cent control over most functions. Where they dont have control is the dealerships. I would shift my focus to the dealers and how they deliver the brand to the customers. Word of mouth in this market is huge. Its an environment where people have huge inter-personal contact. Cars are always a subject of conversation. Bad service always comes on tap. People say nasty things about the brand. Thats the danger.
Car makers make very less margins on sales; where customers get fleeced is spare and service. What you are advising is a tough act.
Its going to get worse. Manufacturers will try to gain control over who services their vehicles and the way they do that is to make sure parts are not available outside the dealer network. They will work with the governments to stop non-branded parts from getting into the market. Manufacturers will say it is about the right quality and a trained technician using the right tool. Their job is to convince you that what you have paid is reasonable value for money. The extra you have spent is worth the money. It is a very challenging space to be in.
How many Indian companies have got their act right? I am going to put my neck out here. Given what I have seen and what I know about the automotive industry, I dont think very many manufacturers, if any, have actually made that link in terms of how important it is going to be for ongoing prosperity to deliver at the dealers level. Virtually all are measuring customer satisfaction, they are not talking about a fully-branded customer experience. In fact, very few manufacturers are doing it globally. One exception is Lexus. It is able to deliver it.
When you go for service, the focus is on the car and not on the customer. In the automotive market, our research shows, the emotional elements are far more important in terms of delivering brand loyalty than the rational elements in some markets, as much as eight times more. It is far more than any other consumable you buy because of the services that you take it for. In car companies, you have people who do the marketing and you have people who deal with dealers. There is no cross-selling. The first manufacturer who does the crossover will see the difference. Consumer research on the two verticals doesnt match up.
Is car dealership a profitable business? In uptimes, I would love to be a car dealer. http://www.business-standard.com/india/news/auto-companies-need-to-deliver-atdealer/s-level/367948/
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| CARS, SUVs, MUVs Go To Top Sindhu Bhattacharya Daily News & Analysis (Web Edition)
New Delhi: There has been continuous speculation about Maruti Suzuki India's gameplan from April next year, when the M800 is phased out from the top 11 Indian cities. Since M800 and has traditionally formed the backbone of Maruti's entry level strategy, what will the company do to maintain its vice like grip on this segment? Already, the launch of Tata Nano is expected to start eating into Maruti's entry-level dreams.
Sources tell us that Maruti has devised a clever, two pronged strategy to meet this challenge: launch a new, upgraded Alto at a price premium, and simultaneously develop a 'cost down' version of the existing Alto to bring it close to the price levels of the M800.
The upgraded Alto, which is already under development and should be launched in the first quarter of next fiscal, will come with the advanced K-series engine and significant design and styling changes as well. It may be priced close to the Rs 3 lakh bracket but this could not be confirmed. Vendor sources say the company does not expect major volumes from this variant -- only 60,000-70,000 units a year.
But the 'cost down' version of the Alto is expected to generate sizeable volumes for Maruti. The company has already been working with vendors on the 'one gram, one component' principle to reduce the weight of each component used in making a car by a gram. This, coupled with other cost saving techniques, could well bring down the price of this 'cost down' Alto rather close to the base version of the M800 or could even within striking distance of the Nano!
So, six months down the line, a first time car buyer can choose between the existing Alto -- which will be priced at the bottom of the pyramid -- and the new, upgraded one. The Alto has been one of Maruti's most successful models, averaging 19,000-20,000 unit sales a month. But sales of the erstwhile bread and butter model, the M800, have been declining continuously though top officials at Maruti insist that the model may see an upgrade to BS IV norms even now.
One thing is for sure though. The first indigenous car, which was launched in the early eighties, would not be selling in Mumbai, Delhi and nine other top cities of the country from April 2010 unless an upgrade is done to make it BS IV compliant.
Gearing up The existing Alto may be replaced with a 'cost down' version This model will be made BS-IV compliant and could be close to the existing M800 base variant or even lower, competing directly with the Nano http://www.dnaindia.com/money/report_cost-down-alto-to-replace-800-dare-nano_1284951
TOYOTA MOTOR LAUNCHES SUV FORTUNER The Hindu (Web & Print Edition)
New Delhi: Toyota Motor on Monday launched its internationally-acclaimed sports utility vehicle Fortuner in India. The Japanese carmaker, which has a joint venture with Kirloskar Group in India, is also expecting a three-fold increase in its sales in the country in the next four years, particularly after the scheduled launch of its new small car in 2011. Priced at Rs. 18.45 lakh (ex-showroom, Delhi), the four-wheel drive SUV comes with a 3.0 litre diesel engine with intercooler turbocharger, offering 171 PS power.
It has an incomparable combination of luxurious interiors and sporty features for an exciting driving experience. The Toyota Outstanding Platform (TOP) that handles all kinds of terrain along with features such as ABS, disc brakes, impact absorbing body and airbags makes it the real SUV, said Toyota Kirloskar Motor (TKM) Managing Director Hiroshi Nakagawa.
The company hopes to sell over 2,000 units of the SUV in 2009. According to Toyota Motor Corporation Senior Managing Director Akira Okabe, the Japanese carmaker is aiming at three-fold increase in its sales in next three to four years, where the sales growth will be fuelled by the launch of new small car that is planned for launch in early 2011 and also some new models. Last year, TKM sold 51,000 units, while this year it hopes to sell 52,000 units.
Stating that the companys sales was likely to remain flat this year, Mr. Nakagawa said in the first seven months of this year, it had sold 25,910 units.
Once our small car is launched, we are expecting to capture a 10 per cent share of the Indian passenger car market by 2015. Our Rs. 3,200-crore small car manufacturing facility in Bangalore could turn the country a hub for small cars in the future, he added. TKMs Deputy Managing Director (Marketing) Sandeep Singh said the company was planning to expand its dealer network from 90 to 150 by 2010. http://www.hindu.com/2009/08/25/stories/2009082555271800.htm
TOYOTA MULLS SMALL CAR LAUNCH UNDER DAIHATSU BRAND Danny Goodman Business Standard (Web & Print Edition) See similar story in: The Economic Times (Web & Print Edition), The Hindu Business Line (Web & Print Edition), The Financial Express (Web & Print Edition), The Times of India (Web & Print Edition), The Pioneer (Web & Print Edition), The Telegraph (Web Edition), Deccan Chronicle (Web Edition), Deccan Herald (Web Edition), mint (Web & Print Edition), Hindustan Times (Delhi Print Edition)
New Delhi: Toyota Motor Corporation, the worlds largest car-maker, is evaluating the Indian market to launch its Daihatsu range of compact cars.
The Daihatsu range of small cars are doing very well in markets like Indonesia and Malaysia, and we are studying the Indian market to launch the Daihatsu brand. Should we launch this new brand, it would be across all passenger vehicle segments including the entry-level 600 cc, said Dato Akira Okabe, senior managing director and member of the Toyota Motor Corporation board. Daihatsu is a Toyota group company.
Okabe was speaking on the sidelines of the launch of the Toyotas third sports utility vehicle (SUV) brand in the domestic market, called the Fortuner.
Daihatsu is known in Japan for its mini-cars and recently launched the 660cc Mira Cocoa which is targeted at women. Its passenger car range includes models like the Materia, Copen, Sirion and Curore or Charade with engine capacities of up to 1.5 litres. Daihatsu had forayed into India many years ago and held talks with the late Manu Chhabria among others, which never fructified.
Toyota, which has a joint venture in India with the Kirloskars (which has an 11 per cent stake), plans to launch its first small car for the domestic market by the end of 2010 or early 2011. Currently, Toyota in joint agreement with Europes Peugeot and Citroen produces three compact car models built on the same platform. Toyotas small car is sold as the Aygo (pronounced 'I go') across Europe, Peugeots small car is called Peugeot 107, and Citroens small car is the Citroen C1.
The production-sharing agreement signed in 2001 was put in place to cut development and production costs for the three car companies. All three cars are developed and produced by Toyota at a manufacturing plant in the Czech Republic.
On whether the Aygo platform would be the same configuration for the Indian small car, Okabe said: Keep guessing. All I can say is that our small car for the domestic market will be a brand new offering.
The small car, according to Toyota executives, will be a model that would generate volumes for Toyota Kirloskar and increase its market share. We may look at launching more than one compact car model for the domestic market. Our current market share in passenger vehicles is 3 per cent. In the next four years, we hope to sell three times our current volumes. And by 2015, our rate of growth will be in double digits, says Okabe.
Last year, Toyota Kirloskar sold around 46,892 vehicles in the domestic market and expects to sell 52,000 for the current year.
Okabe said there was a possibility of exporting cars from India in the future. Last year, Daihatsu, sold 1,336,000 cars worldwide, a 2 per cent growth over the previous year. Apart from Japan, the company has manufacturing facilities in Malaysia, Indonesia, China, Pakistan, Venezuela and Colombia, amongst others. Countries like Germany and the Netherlands are key markets in Europe.
Toyotas SUVs available in the domestic market include the Landcruiser (premium segment), Prado (mid-range), and the recently launched Fortuner (lower range).
In response to a query, Kaoru Hosokawa, Toyota's chief engineer, said the company was considering launching an entry-level SUV that costs less than Rs 15 lakh. The Fortuner costs Rs 18.45 lakh (ex-showroom Delhi) and the company hopes to sell around 2,500 units this year. http://www.financialexpress.com/news/toyota-sees-flat-sales-launches-suv/506591/ http://www.thehindubusinessline.com/2009/08/25/stories/2009082551920200.htm http://www.dailypioneer.com/197955/Toyota-eyes-double-digit-market-share-by-2015.html http://www.telegraphindia.com/1090825/jsp/business/story_11405251.jsp http://www.deccanchronicle.com/business/toyota-kirloskar-launches-fortuner-951 http://www.deccanherald.com/content/21208/toyota-kirloskar-launches-fortuner.html http://www.livemint.com/2009/08/24114042/Toyota8217s-Fortuner-enters.html
TOYOTA PLANS 'STRATEGIC' SMALL CAR TO PUSH SALES PTI See this story in: The Economic Times (Web Edition), The Times of India (Delhi Print Edition), The Indian Express (Delhi Print Edition), Daily News & Analysis (Web Edition)
New Delhi: Toyota, the world's biggest car maker but a marginal player in India, on Monday said that it's looking to treble business here by 2012, for which it will roll out a 'strategic' small car possibly by next year. http://www.dnaindia.com/money/report_toyota-to-scale-down-spend-on-new-plant_1284924
GM INDIA BETS BIG ON PLANNED MINI-CAR See this story in: Deccan Chronicle (Web Edition), Asian Age (Web & Print Edition), mint (Web & Print Edition)
New Delhi: Carmaker General Motors has said it will export at least 20 per cent of the planned production of 50,000 units of its mini car within the first 12 months of launch early next year.
The company will also roll out luxury sedan Chevrolet Cruze in October with a 2.0 litre diesel engine, which would be followed by a 1.8 litre petrol one. Besides, it is planning to launch four models in India in 2010.
"We will start production of our mini car, developed on the concept of Beat, at our Talegaon plant in December and it will be launched sometime in January next year, starting with the petrol variant," General Motors India president and managing director Karl Slym said.
The mini car would cost around Rs 4 lakh and the company hopes to produce over 50,000 units during 2010, he added.
"The company is targeting to export 20 per cent of the mini car's total production during that period," Mr Slym said. The Indian subsidiary of the US car giant General Motors is aiming to sell 10,000 units of the mini car by end the of 2010 in Sri Lanka, Bangladesh, Bhutan, Nepal, besides the Asia-Pacific region and European countries, he added. http://www.deccanchronicle.com/business/gm-india-bets-big-planned-mini-car-977 http://www.asianage.com/presentation/leftnavigation/news/business/gm-to-export-20%-of-mini.aspx http://www.livemint.com/2009/08/24165511/GM-India-bets-big-on-planned-m.html
NISSAN ON THE FAST TRACK WITH INDIA CAR PLAN Manu P. Toms The Hindu Business Line (Web & Print Edition)
Mumbai: Japanese automaker Nissan has drawn up an aggressive plan for India which will see a business model comprising five locally made cars and four imported models. By 2012, the company has targeted a modest five per cent share of the market which is estimated to be close to 1.5 million units at that time.
In the meantime, the new editions of the Teana sedan and the X-Trail SUV will hit the roads next month. By early 2010, Nissan will introduce the sports car 370Z, which will be its third imported model.
The company, whose manufacturing plant is being commissioned near Chennai in March 2010 with a capacity of 2 lakh units, has reiterated that there is no change in its plan. Our commitment to the Tamil Nadu Government is that we (which includes global ally, Renault) will invest Rs 4,500 crore in seven years and will increase capacity to four lakh units within this period. That is basically our fundamental plan, Mr Kiminobu Tokuyama, Managing Director and CEO, Nissan Motor India, told Business Line.
The first India-made Nissan car will roll out of the V platform on which the Micra is produced. We will launch the car by the end of June 2010, he said. The idea is to produce a hatchback version, followed by a sedan in 2011 and a third model which is right now at the planning stage.
We will produce two more models in India. The company is now studying which could be suitable for the Indian market though the goal is to have a mid-range product in India, said Mr Tokuyama.
Recruitment Nissan is going all out on new recruitments and vendor development for the Chennai project. It has already recruited 500 people at the manager and group leader levels in manufacturing which will be up to 1,500 by April 2010. This will be doubled to 3,000 by 2012.
On the supplier front, the company is already engaged in contract with 94 of them and has set itself a target of 80-90 per cent localisation. Incidentally, 20 of the 94 vendors will be setting up their units in the supplier park.
On partner Renaults decision to freeze investments for the moment, Mr Tokuyama said that the two companies had decided to use common platforms for their India operations. They can use these platforms whenever they are ready, he added.
As for the ultra-low-cost car project being planned with Renault, Nissan and Bajaj Auto, he said, Renault and Nissan are working to optimise the product and the plan. The team is working on product definition and the details, while adding that he was not involved in the project which is being led by Renault from our side. http://www.thehindubusinessline.com/2009/08/25/stories/2009082550800300.htm
FIAT INDIA CLOSES SYNDICATION FOR RS 2,500-CRORE CREDIT LINES PTI See this story in: The Economic Times (Web Edition), Business Standard (Web & Print Edition), The Hindu Business Line (Web Edition), The Pioneer (Web & Print Edition), Deccan Chronicle (Web Edition), The Times of India (Delhi Print Edition)
Mumbai: Auto major, Fiat India, on Monday announced the completion of financial closure for projects at its plant at Ranjangaon near Pune.
The company has finalised three syndicated secured credit facility agreements with a consortium of Indian and international banks for a total amount equivalent to Rs 2,500-crore, a company press release said. http://www.business-standard.com/india/news/fiat-india-secures-fundsup-to-rs-2500-crore/368011/ http://www.thehindubusinessline.com/2009/08/25/stories/2009082550860300.htm http://www.dailypioneer.com/197952/Fiat-India-secures-Rs-2500-cr-funds.html http://www.deccanchronicle.com/business/fiat-secures-loans-worth-rs-2500cr-208
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| 2/3 WHEELERS Go To Top PTI See this story in: The Hindu Business Line, Business Standard, The Financial Express
Jaipur: Eyeing 10 per cent growth in commercial auto division, Bajaj Auto plans to launch four new models in passenger and goods carrier segment within six months, a senior company official said.
The company, which exports 50 per cent of its passenger and goods vehicles to more than 17 countries, is planning to manufacture eco-friendly vehicles, Bajaj Commercial Division CEO, Mr R C Maheshwari said.
We are speaking to various state governments to promote LPG and CNG variants of our vehicles. All the four new launches will be either in petrol or LPG and CNG, he said, adding that diesel vehicles comprise only 30 per cent of its product portfolio. We push diesel variant in rural areas only where population is sparse, he said. The company targets to sell 3 lakh units in this segment.
In the last fiscal, we sold 2,74,000 vehicles. This year we plan to sell 10 per cent more, he said. http://www.thehindubusinessline.com/blnus/02241715.htm
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| COMPONENTS Go To Top The Financial Express
Pune: Bharat Forge Ltd (BFL), the flagship company of the $2.4-billion Kalyani Group, is set to enter the wind energy business. We are now at a stage of having our own wind energy business. There have been some installations in Europe. The company will supply critical components for wind turbines for Tata Power's upcoming power plants in Maharashtra, Baba Kalyani, CMD, Bharat Forge said.
The company will be supplying 1.5 mw wind turbines for Tata Power's upcoming 10 mw power plant to at Satara. Installation work will begin next month. This is a beginning and we will consider other opportunities in the energy sector as well, Kalyani said. The company's client base in the renewable energy sector includes GE and Siemens. In the thermal energy sector, BFL works with BHEL and in oil and gas with clients such as Cameroon and FMC.
The company is seeking opportunities in the non-auto sectors as well and the shift is happening in a seamless fashion. We are developing capability to get into any sector what we want. The company's Mundhwa plant for the non-automotive components will be the building block for the company's non-auto strategy and further into capital goods, Kalyani said.
We have signed a pact with Alstom for power equipment for a 5,000 mw power plant and tied up with Areva for making large forgings and castings and nuclear equipment, he said. http://www.financialexpress.com/news/bharat-forge-to-foray-into-wind-energy/506599/
UNIDO TO LAUNCH PROJECTS FOR CLUSTER DEVELOPMENT IN INDIA See this story in: Deccan Chronicle
New Delhi: The United Nations Industrial Development Organisations (Unido) will launch cluster development projects at an estimated cost of $8.9 million in eight cities in India, including the national capital.
Agreements on this were signed earlier this month in Vienna by secretary of the Department of Industrial Policy and Promotion (DIPP) Ajay Shankar and UNIDO director-general Kandeh Yumkella, an official statement said here on Monday.
Besides New Delhi, the projects would be developed in Pithampura (Madhya Pradesh), Chennai, Ankhleswar (Gujarat), Pune, Belgaum, Coimbatore and Kanpur.
A $5.9 million project which would be implemented by 2014 at clusters like auto-component at Pithampura, Chennai and Pune would be focused on technology, management, skill development and the environment.
"A separate project worth $3 million will deal with upgrading India's machine tools industry," it said. Projects relating to foundry clusters at Belgum and Coimbatore would be launched shortly, it added.
The projects would provide employment and income opportunities without jeopardising the livelihood of the human settlement through environmental degradation and without threatening the rapidly depleting water resources, it said. http://www.deccanchronicle.com/business/unido-launch-projects-cluster-development-india-048
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| ALLIED INDUSTRY Go To Top PTI See this story in: The Hindu Business Line, Daily News & Analysis, The Financial Express
Tiruchi: After a lull in the previous quarters due to steep petroleum prices, the tyre industry seems to be getting back on track with JK Tyre and Industries Ltd projecting a sales turnover of Rs 4,000 crore in the current fiscal. Business was very dull for the industry in July-December 2008 and the previous quarter due to prohibitive petroleum price, with a barrel being sold at $130-140 and natural rubber priced at Rs 120-130 a kg, said Mr A.S. Mehta, Marketing Director of the company.
The industry faced the brunt as up to 60 per cent of the raw material is from petroleum-based products. However, the sector seems to be recovering from April 2009 onwards. Net sales in April-June 2009 was Rs 900 crore as against Rs 850 crore last year. A sharp fall in raw material prices has seen operating profit jump to Rs 41 crore in the first quarter of the current fiscal against Rs 20 crore in the same period last year. http://www.thehindubusinessline.com/blnus/02241060.htm http://www.dnaindia.com/money/report_jk-tyre-projects-sales-turnover-of-rs-4000-cr-this-year_1284734
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| FINANCE & INSURANCE Go To Top The Hindu Business Line
Hyderabad: Piaggio Vehicles has entered into a tie-up with Andhra Bank for retail finance for its three- and four-wheeler range of vehicles. The memorandum of understanding was entered into by Mr Sanjay Jog, Regional Manager, Piaggio Vehicles, and Mr Nilamani Patel, General Manager of Andhra Bank, recently. In a statement, Mr Sanjay Jog said that the objective of this tie-up was to offer highly competitive retail financing schemes with easy payment terms to customers. http://www.thehindubusinessline.com/2009/08/25/stories/2009082550870300.htm
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| OIL, LUBRICANTS & ALTERNATIVE FUELS Go To Top The Hindu Business Line
New Delhi: Indraprastha Gas Ltd (IGL) the sole supplier of CNG and piped natural gas in the National Capital Territory of Delhi is exploring opportunities to enhance cooperation with Reliance Industries in the city gas distribution and its value-added business.
Speaking to Business Line, Mr Rajesh Vedvyas, Managing Director, IGL, said, We are looking at opportunities with companies having gas sources. Long-term commitment of gas supply is required for IGL to expand its business. IGL is now looking at commercial and industrial customers.
Indraprastha has started drawing natural gas from the Reliance Industries-operated D6 block in the Krishna-Godavari Basin from Monday. The company had signed the gas sale and purchase agreement with RIL and Niko on August 13, along with the gas transportation agreement with Reliance Gas Transportation Infrastructure Ltd (RGTIL).
Under the agreement, 0.308 mscmd of natural gas is being made available to IGL to meet the growing demand of CNG and piped natural gas. The quantity is expected to grow up to 0.5 mscmd by end of the financial year.
RGTIL will transport gas from Gadimoga near Kakinada in Andhra Pradesh till Ankot in Gujarat, where its pipeline connects with HVJ pipeline of GAIL (India) Ltd. The delivered D6 gas price is expected to be close to Rs 12 per standard cubic metre (approximately $6.38/mBtu).
Price differential IGL receives its supply of 2 mscmd Mumbai High gas from HVJ pipeline of GAIL. Apart from D6 gas, IGL sources administered price (APM) gas and re-gassified liquefied natural gas (R-LNG).
While the delivered price of APM gas is Rs 5.40 a standard cubic metre that of R-LNG is Rs 13.5 a standard cubic metre. Asked how IGL would work out the consumer price, as it receives gas from three sources at different prices, Mr Vedvyas said, We have worked out a pool price so that consumers do not take a hit.
After three years IGL has recently raised consumer price for CNG by Rs 2.10/kg to Rs 21/kg. The reason for the increase is not only because of the differential gas price but also due to increase in the operating expenses.
Still, some part of the total increase in operating expenses is being passed on to the consumers and the rest is being absorbed by us. http://www.thehindubusinessline.com/2009/08/25/stories/2009082551880200.htm
OIL PRICES GAIN TO ABOVE $74 ON RECOVERY HOPES AP See this story in: The Times of India
Oil prices rose above $74 a barrel Monday, helped by rising stock markets and spreading optimism about a global economic recovery. Expectations that demand for energy will grow were spurred by Federal Reserve Chairman Ben Bernanke, who said Friday that the U.S. economy is reviving. http://timesofindia.indiatimes.com/news/business/international-business/Oil-prices-gain-to-above-74-on-recovery-hopes-/articleshow/4929447.cms
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| INTERNATIONAL NEWS Go To Top Bloomberg See this story in: The Economic Times
Michigan: General Motors may sign an agreement for the sale of the Hummer sport-utility vehicle business to a Chinese machinery maker this week, said two people familiar with negotiations. Executives from prospective buyer Sichuan Tengzhong Heavy Industrial Machinery based in Chengdu, China, are expected to arrive in Detroit early this week for more negotiations with GM, said the people, who asked not to be named because the talks arent public.
GM TRYING TO DEVELOP FINANCING TO KEEP OPEL: REPORT Agencies See this story in: The Economic Times
New York: General Motors is trying to develop a 4.3 billion dollar financing plan that would allow it to keep control of Opel, The Wall Street Journal reported late Monday.
US GOVERNMENT TO LEAVE OPEL CHOICE TO GM Reuters See this story in: The Economic Times
Washington/Frankfurt: The Obama administration pledged on Monday to stay out of General Motors Co's choice of a buyer for its Opel unit in Europe as German union leaders put more pressure on the US automaker to make a decision.
TOYOTA RECALLS 6.9 LAKH CARS IN CHINA PTI See this story in: The Hindu Business Line, The Pioneer, Asian Age, Deccan Chronicle, The Statesman, mint
Beijing: Japan's Toyota Motor Corp on Monday announced its biggest ever recall in China, involving 6,88,314 sedans citing a defect in the electric window system.
The affected sedan models are Camry, Corolla, Yaris and Vios manufactured in China by local joint venture firms with Toyota from May 2006 to the end of 2008.
The recall includes 384,736 Camry models and 22,767 Yaris models made by Guangzhou Toyota between May 15 and Dec 31 of 2008, the General Administration of Quality Supervision, Inspection and Quarantine said.
The recall also includes 35,523 Vios cars made by Tianjin FAW-Toyota Motor between Feb 18 and Dec 25 of 2008, and 245,288 Corolla models made between May 17, 2007 and Dec 25 of 2008.
Some owners of the Toyota cars in question reported problems when opening and closing the window on the driver's side. Toyota found that parts inside the window switches could cause part of the interior furnishing to melt, produce smoke or even catch fire. No injuries have been reported due to the defect.
It will be the largest ever auto recall in China since 2004, Beijing Times reported. Toyota will start replacing the problem parts from tomorrow free of charge. The latest discovery of faulty car parts comes on the heels of a recall of about 260,000 Chinese-made Camries in April when the model's brakes were found to be at risk of malfunc tioning, Kyodo news agency said. http://www.thehindubusinessline.com/blnus/10241710.htm http://www.dailypioneer.com/197949/orders-biggest-recall-of-69-lakh-cars-in-China.html http://www.asianage.com/presentation/leftnavigation/news/business/toyota-orders-largest-recall.aspx http://www.deccanchronicle.com/business/toyota-orders-largest-recall-204 http://www.thestatesman.net/page.news.php?clid=12&theme=&usrsess=1&id=266014 http://www.livemint.com/2009/08/24093958/Toyota-to-make-largest-auto-re.html
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| ECONOMY & FINANCE Go To Top PTI See this story in: The Hindu The rupee managed to close with gains against the dollar for the fourth straight session on Monday, inching up by two paise to 48.61/62 against the greenback, as late dollar buying by importers eroded its early lead amid firm stock markets.
At the interbank foreign exchange market, the domestic unit resumed sharply higher at 48.40/42 from its last weekends close of 48.62/64 and touched a high of 48.39 due to smart rally in stock markets.
Dealers attributed the early rise in rupee to sustained bullishness in the equity markets. A weak U.S. dollar against major world currencies also aided rupee sentiment at initial stages. Global crude oil prices were trading above $74 a barrel in Asian trade. http://www.hindu.com/2009/08/25/stories/2009082555051700.htm
SENSEX UP FOR 3RD STRAIGHT DAY; FIIS STAY INVESTED PTI See this story in: The Hindu Business Line
Mumbai: The benchmark Sensex on Monday jumped by close to 390 points in tune with global stocks on FIIs renewing buying activities after the US Fed chief, Mr Ben Bernanke's remarks that economic recovery could be round the corner.
Extending its gains to the third straight day, the BSE 30-share barometer closed higher by 2.55 per cent or 387.92 points at 15,628.75.
Buying in bourses across the world was fuelled by Mr Bernanke's comments last weekend that economic activity appears to be levelling out. He noted that the prospects for a return to growth path in the near term appear good.
His comments were greeted by investors around the world. Asian stocks gained in the range of 1-3 per cent and European indices are trading higher in the range of two per cent. The foreign institutional investors were believed to be heavy buyers during the day. They had bought shares worth Rs 532.80 crore in equity on August 21 (the last trading day), as per the provisional data.
Market men said positive FII activity and expectations of stability in India's industrial production and economic growth also boosted the sentiment.
Wider index Nifty on the National Stock Exchange also spurted by 114.00 points to close at 4,642.80. On BSE, the rally was led by Tata Motors which gained a handsome 5.83 per cent. Besides the heavyweight stocks, small and mid cap counters also attracted buying.
The small cap index and midcap index flared up by 182.89 points and 145.06 points respectively. http://www.thehindubusinessline.com/blnus/05241901.htm
FISCAL DEFICIT WONT EXCEED 6.8% TARGET: MONTEK The Economic Times
New Delhi: The Planning Commission has said that the fiscal deficit, the difference between revenue earned by the government and expenditure made, will not exceed the budgetary estimate of 6.8% of gross domestic product (a measure of total economic output of a country). Planning Commission deputy chairman Montek Singh Ahluwalia said on Monday that there is no reason to think that 6.8% (fiscal deficit target) will be crossed even though there is falling revenue and rising expenditure to combat the impact of drought as well as global meltdown. Noting that the deficit is dependent on many factors, he said: Whatever happens ... one (additional expenditure) can get offset by (savings on) other items. As of now we are not changing the estimate (of 6.8% fiscal deficit). Finance Minister Pranab Mukherjee, in the Budget for 2009-10, pegged the fiscal deficit target at 6.8% of the GDP, up from 6.2% in the previous fiscal. Meanwhile, Prime Minister Manmohan Singh has called the first meeting of the newly constituted Planning Commission on September 1. The meeting, which will be attended by finance minister Pranab Mukherjee, agriculture minister Sharad Pawar and other Cabinet ministers, will discuss the state of the economy and review implementation of the integrated energy policy. The government had decided to borrow Rs 4.5 lakh crore from the market during the current fiscal, up from Rs 3.1 lakh crore in 2008-09. A higher fiscal deficit would mean that the government will have to borrow more from banks at the cost of industry and other borrowers. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved"
Last Financial closing
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Monday, August 24, 2009
Indian Auto Industry Update August 25, 2009
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