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| INDUSTRY INTERVIEWS/FEATURES CARS, SUVs, MUVs Maruti doubles its sales in Orissa Suzuki to spend $215 million on new Haryana factory Suzuki to build factory in India: Report Reva to increase client base with 2 new models 'Reva will soon adopt a licensing model': Chetan Kumaar Ford plans new engine for small car Volkswagen plans to double India headcount COMMERCIAL VEHICLES | ALLIED INDUSTRIES The strikes at the plants cost us 1000 crore: CMD, MRF 'We have an open highway': MD, Apollo Tyres Apollo Tyres eyes growth, global top 10 slot in 5 yrs FINANCE & INSURANCE OIL, LUBRICANTS & ALTERNATIVE FUELS ECONOMY & FINANCE
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| INDUSTRY Go To Top Samar Srivastava Mint (Web & Print Edition) (Sept 07)
Ambala, Haryana: Pawan Gupta was in two minds when he set up his dealership for Ford cars on the outskirts of Ambala in January. After all, this small cantonment town in Haryana has just 400,000 residents and there was no telling if there would be enough buyers.
Unlike rivals Maruti Suzuki India Ltd and Hyundai Motor India Ltd, Ford Motor Co. doesnt sell small cars in India; these account for nearly three of four cars sold in the country.
Nine months later, Guptas Pearl Ford dealership has sold more cars than anticipated. It sells between 17 and 20 cars a month, up from the five cars a month Ford sold in the area before the dealership was set up. I expect to break even in a couple of years, Gupta says, smiling.
As towns and villages across India become increasingly central to their sales efforts, car firms are beginning to focus on their first point of contact with customers: the dealership. The firms no longer expect customers to travel to cities to buy and service their cars.
Rising rural sales have made setting up dealerships in small towns viable. Ford Motor India Pvt. Ltd, for instance, plans to add 20 dealers this year to its existing 120-odd in towns such as Ambala, Siliguri in West Bengal, Anantapur in Andhra Pradesh and Varanasi in Uttar Pradesh.
Firms such as Maruti and Hyundai have been venturing into the towns and villages because of increasing demand from these places. At Maruti, the countrys largest car maker, rural sales made up 12% of its total sales of 722,144 in 2008-09, up from 3.5% the year before.
Maruti, which began its push into towns and rural areas much before its rivals, has at least 500 dealers located outside larger cities, out of a total 712 dealers, said a company spokesperson.
For firms such as Ford and Toyota Kirloskar Motor Pvt. Ltd, the local arm of the worlds largest auto maker, their expansion precedes the small cars they plan to launch in India next year. Ford said on Thursday that it is on track to sell its first small car in India from early 2010.
Toyota, which plans to launch a small car by the end of 2010, aims to add 55 dealers before that, and mostly in the small towns. If you really want to sell small cars, you have to go into smaller towns, says Sandeep Singh, deputy managing director for marketing at Toyota.
General Motors India Pvt. Ltd, which sells the Spark small car in India and plans to launch another small car at the 2010 Auto Expo, says it will increase the number of its dealers to 250 from 195 by the end of this fiscal year. All our (dealer) expansion is taking place only in rural areas, says P. Balendran, vice-president of corporate affairs at General Motors.
But the strategy has its pitfalls. For one, as more car makers rush to tap rural demand, they could realize that the market is too small to support so many competitors.
Forecasting firm CSM Worldwide Inc. projects a sharp increase in dealerships in India by all manufacturers by 2012. Tata Motors Ltd would add 200 dealers, taking its total number of dealerships to 450, while Honda Siel Cars India Ltd would add 65, taking its total to 165. Much of this expansion would take place in small towns, says Puneet Gupta, an analyst at CSM.
As a result, sales per outlet may not be enough to support viable businesses. Already, the average number of cars sold by dealers in India is a lot less than the global average. According to CSM, Indian dealers sell 58 cars a month compared with 1,288 for Toyota dealers and 1,165 for Honda dealers Rural demand may not grow as quickly globally. The second likely pitfall: as anticipated.
Consumer spending from rural India bolstered the countrys economy in the wake of the downturn, after six years of an average 4.4% growth in agriculture, and supported in part by the governments loan waiver packages for farmers and its National Rural Employment Guarantee Scheme that guarantees 100 days of work in a year to one member of every rural household. The poor monsoon rains, the worst in seven years, may undo some of that.
For now, car makers are taking their small town customers very seriously. Pearl Ford at Ambala has all the usual spit and polish any city outlet would have. A large display area houses the Ikon and Fiesta models. Prospective customers are left free to wander around and examine the cars and ask for test drives.
Test driving vehicles is very important for rural customers, says Nigel Wark, executive director for marketing at Ford India. Wark knows car sales in small towns are based largely on word of mouth and one satisfied customer could yield several more.
Small-town buyers also tend to ask for smaller discounts than their urban counterparts. This, coupled with cheaper realty prices, makes it easier for dealers to break even faster.
When he set up his first dealership in Karnal, Haryana in 2002, it took Gupta three-and-a-half years to break even. His Pearl Ford should take just half as long.
Behind the showroom, a large workshop houses five service bays with technicians trained by the company. With dealers earning at least 60% of their revenue from servicing and repair jobs, Ford has taken extra care to ensure the workshop is up to scratch.
On a recent afternoon, Satvinder Singh had come with a few friends to take a look at the Ford Ikon. I want a diesel car and Ive heard from a friend that Ford was a good option, says the wheat farmer, who owns at least 100 acres of land.
After being taken through the features of the car, he went on a test drive. I now have my heart set on this car, he said. http://www.livemint.com/2009/09/06234256/Car-makers-focus-on-rural-deal.html?h=A1
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| INTERVIEWS/FEATURES Go To Top Mumbai: The improvement in the domestic commercial vehicle sales should come as a relief for Tata Motors, which has been weighed down by losses and debt on account of Jaguar Land Rover (JLR), its $3 billion acquisition last year. Indias largest auto company, which reported a consolidated loss of Rs 329 crore for the June quarter largely on account of poor sales at JLR, saw its commercial vehicle sales post positive growth rates year-on-year and sequentially for the second month in a row. While analysts say that JLR sales are at near bottom and there should be a recovery on the back of incentive programmes by Western governments, for the near-term Tata Motors will increasingly look to its bread-and-butter commercial vehicle portfolio (including the high margin LCVs) to improve profitability and passenger vehicles (small car Nano) to deliver on the volumes front. Tata Motors recorded sales of nearly 50,000 vehicles in August 2009, up 14 per cent y-o-y. While the biggest gains came from higher sales of light commercial vehicles, the worst hit category, the medium and heavy commercial vehicles (M&HCV) have also seen encouraging growth. While July saw 6 per cent y-o-y growth, August sales were up 10 per cent y-o-y.
The average sales of the M&HCV vehicles for the first five months of 2009-10 was at 9,680 units. Driven by the Ace and its variants (Winger and Magic), the LCV segment sales surged 42 per cent y-o-y while they recorded a 5 per cent gain sequentially. To take advantage of the growing popularity of these vehicles the company is planning to launch another LCV this calendar year with a lower carrying capacity than the Ace.
The growth in commercial vehicle sales for the last couple of months is on account of higher demand and weak competition which has helped Tata Motors increase market share in the recent past. In the June quarter for example, it increased its M&HCV share by 400 bps to 66.7 per cent while the increase in LCV share was 900 bps to 68.5 per cent.
Aided by sales to state transport corporations under JNNURM, the company increased its market share in the bus segment to 56.4 per cent from 42.7 per cent in the same period.
The JLR question In contrast to the improving scenario in the Indian operations, the business situation in the key markets of the UK and the US (50 per cent of sales for JLR) continues to be challenging. For the June quarter, JLR reported a 35 per cent drop in wholesale volumes and a 52 per cent decline in retail volumes. Sequentially, however, wholesale volumes for the June quarter improved 10 per cent to 35,900 units while retail volumes moved up to 47,200 units for the same period which indicates that the company was able to clear the inventory at the retail level. While the signs are encouraging, the management and analysts believe that a recovery in the luxury car segment is only expected in 2010-11. Meanwhile, the company is focussing on reducing costs on the headcount (about 20 per cent reduction), marketing expenses, salaries, raw material and by shutting down offices. While the Rs 512 crore loss for JLR in the June quarter was primarily due to lower volumes, these steps will help reduce its losses gong ahead. The continuing investments in carbon dioxide reduction programme for Jaguar and new product development costs has meant that the Rs 2,500 crore line of credit from European Investment Bank will help it tide over working capital needs and R&D costs. http://www.business-standard.com/india/news/domestic-gains/369221/
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| CARS, SUVs, MUVs Go To Top
Chennai: Maruti Suzuki India has said that it will shift production from one plant at the Gurgaon factory in Haryana, to the factory at Manesar, 25 km to the south, also in the same State. The plant at the Gurgaon facility will be gradually changed to a base for engine assembly and machining, while the automobile assembly will be integrated at Manesar, according to a company press release.
The release said on Saturday that the Gurgaon Plant I was constructed in the early 1970s and refurbished and modified before Maruti Udyog (as the company was called before Suzuki Motor Corporation acquired a majority stake) began production in 1983. The almost 40-year-old building and equipment have been depreciated to a large extent. It is necessary to reconstruct the building and modernise the production facilities, the release said.
It said that since the land at the Gurgaon campus was fully used-up, the company decided that facilities from Plant I in Gurgaon should be added and shifted to Manesar plant in a phased manner. As the shifting of production facilities will result in increased production volumes at Manesar, the company has sought further support from the Haryana Government so that the railway siding at Manesar can be completed at the earliest.
Plant I has a capacity of over 2.50 lakh units a year and rolls out the Maruti 800, the Omni, the Versa, the Gypsy, the Ritz and the Alto. The Alto is made in all the three plants at Gurgaon, according to company sources.
Production capacity Suzuki Motor Corporations Chairman and CEO, Mr Osamu Suzuki, who was in India earlier this week, reviewed the production facilities of Maruti Suzuki.
Agency reports from Japan quoted Mr Suzuki as saying that shifting the production facilities would not change Maruti Suzukis overall annual production capacity of one million units.
Marutis three plants at Gurgaon were commissioned in 1983, 1994 and 1999 respectively. Together, they have a capacity of seven lakh units a year. At the Manesar facility, inaugurated in February 2007, the company makes the Swift, the DZire, the SX4 and the A-star. The company recently increased production capacity from 1.30 lakh units to three lakh units at Manesar following a strong demand for these models. Maruti will invest Rs 1,000-1,500 crore in a research and development centre at Rohtak, for which the Haryana Government recently allotted 700 acres. The first phase of the centre will be ready by 2012 and the second by 2015. Maruti will be the global R&D hub for Suzuki Motor Corporation. It will also design and develop a car and launch a Made in India car by 2012.
In an interview published in the companys 2008-09 annual report, Mr S. Nakanishi, Managing Director and CEO, Marutu Suzuki, said the company is working on a direct railway link from its Manesar assembly line (in Haryana) to the roll-on, roll-off terminal at the Mundra port in Gujarat, from where its cars are exported.
MARUTI DOUBLES ITS SALES IN ORISSA PTI See this story in: The Hindu Business Line (Web Edition) (Sept 07)
Berhampur (Orisa): Maruti Suzuki India Ltd has doubled its sale in Orissa during the first five months of the current financial year compared to the corresponding period last year. While, in the last two years the company had achieved a growth of over 2 0 per cent, the leading car maker doubled the growth to 42 per cent during the April-August period in the state.
The company had already sold nearly 3,700 cars of different models across Orissa during the period, as against around 2,500 cars in the corresponding period last year, Maruti area manager, Orissa, Rohit Kohli said. The market share of the company in the state is around 52 per cent.
In August alone, the company had registered 64 per cent growth in sales in the State as against its all India growth at 29.3 per cent, he said. The reason for the high growth in sales of its vehicles in Orissa is because of the company's focus on the ru ral, corporate and government sectors, company sources said. These sectors are growing and customers are increasingly feeling the need to own a car with improved affordability, they said.
While, the company's Alto sales growth was at 28 per cent, in A2 segment Wagon R was dominant with 26 per cent growth. Similarly in A2+ segment, demand for Swift grew at 7 per cent during the period, he claimed. Maruti had launched three new models in A2 segment this year and these models, according to its area manager, have actually helped the company to achieve higher growth in the state.
The newly launched models included A Star, Ritz and New Estilo. All new models have received good response by the customers, Mr Kohli stated. In the A3 segment, Dzire continue to rule with 119 per cent growth. This, is in spite of the fact that custome rs have to wait for nearly 2 months to get this model, he said. The growth rate of its SX4 model stood at 22 per cent, while the old horse model Omni was selling at 25 per cent growth in year-on-year, sources said. http://www.thehindubusinessline.com/blnus/02061305.htm
SUZUKI TO SPEND $215 MILLION ON NEW HARYANA FACTORY
Tokyo: Japan's Suzuki Motor said it plans to invest about 20 billion yen ($215 million) to build a new car factory in India, aiming to upgrade its production facilities in the face of growing competition.
SUZUKI TO BUILD FACTORY IN INDIA: REPORT Reuters See this story in: The Economic Times (Web Edition) (Sept 06)
REVA TO INCREASE CLIENT BASE WITH 2 NEW MODELS Peerzada Abrar & Anirvan Ghosh The Economic Times (Web & Print Edition) See this story in: Daily News & Analysis (Web Edition) (Sept 07)
Bangalore: Electric carmaker Reva is targeting a larger customer base with two new indigenous vehicles, a four-seater, two-door hatchback and a sporty two-seater, said Reva Electric Car Company deputy chairman and chief technology officer Chetan Kumaar Maini. Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved" http://www.dnaindia.com/money/report_reva-revvs-up-for-big-boys-game_1288078
'REVA WILL SOON ADOPT A LICENSING MODEL': CHETAN KUMAAR Pranav Nambiar Daily News & Analysis (Web Edition) (Sept 07)
Bangalore-based Reva Electric Car Company (RECC), which is on course to drive in two new cars, is also revamping its business model. For the first time since inception in 1994, India's only electric-car maker plans to adopt a shared global manufacturing model. It is identifying licensee partners who will distribute the cars under the Reva brand name. DNA caught up with Chetan Kumaar Maini, deputy chairman and CTO, RECC, for a chat on the company's new business model and the strategies going ahead.
Excerpts:
With your new models expected to hit the roads by 2011, what is the capacity augmentation? We will commission a new assembly plant close to our current 6,000-unit annual capacity plant in Bommasandra. The new 18,212 square metre facility will have an annual capacity of 30,000 units and be operational by year-end. We invested Rs 30 crore for this new plant. Also, as we are planning to scale up, we are tweaking our business models.
Can you elaborate on this new business model? In the next one year, we will reach out to 12 additional overseas markets from the current 24 and move to over 25 new cities in India from just Bangalore and Delhi. As we expand, we believe it's imperative that manufacturing is shared globally with partners. We are identifying licensee partners who will procure our cars in completely knocked down (CKD) condition or as completely built units (CBU) and sell it under the Reva brand.
Also, currently we dependentirely on the Internet for sales. With licensee partners, we could get better access to different markets. Due to our early starter advantage, we are also looking to license our technologies like drivetrain management to other OEMs who are new in the business. Half of the 3,000 cars we have sold till date were exports. This is dominated by the UK and Norway. We expect the share of exports to increase to 60% in the next few years.The new markets we are targeting would primarily be in Europe, where governments are encouraging the use of electric vehicles.
A few months back, we had no plans to enter the US, but it's a difficult market to break into. However, now, with President Obama's $2.4 billion grant to drive in 1 million electric cars by 2015, the US looks very attractive. Even domesticbuyers are beginning to accept our cars and hence, we are moving to more cities. Our old models with lead acid batteries will continue to sell in India and we have no plans to phase them out.
Can you give us an idea of the current status of the electric vehicle markets? Electric cars constitute around 0.5% of entire global car sales. Currently, there are only a handful of companies like Tesla and ourselves manufacturing these cars. However, with the stress on going green and sops from several governments -- particularly in Europe and the US -- the market will see a quantum leap going ahead. The UK government, for instance, offers a tax credit of up to 5,000 for electric-car buyers. A host of biggies, including Nissan, BMW, Renault, Mitsubishi and General Motors will soon enter the segment.
http://www.dnaindia.com/money/interview_reva-will-soon-adopt-a-licensing-model_1288062
FORD PLANS NEW ENGINE FOR SMALL CAR Sounak Mitra The Telegraph (Web Edition) (Sept 07)
Maraimalai Nagar (Chennai): Ford India, which plans to launch its Rs 3-lakh plus small cars in early 2010, intends to use the EcoBoost engine in them.
According to the company, the engine will increase fuel mileage by 20 per cent. It will reduce carbon dioxide emissions by 15 per cent compared with conventional petrol and diesel engines. Using the gasoline turbo-charged direct-injection technology, EcoBoost will enable Ford to meet future emission norms.
The company has already introduced the technology in compact cars and large trucks in the US. Initially, we will develop the 1.2-litre petrol and 1.5-litre diesel engine with regular technology to benefit from the governments policy of lower excise on such engine sizes. We will introduce the much expensive EcoBoost engines in the long-term, Ford India president and managing director Mechael Boneham said.
Ford plans to take the small car beyond India to other emerging markets such as China, eastern Europe and South America, Timothy D. Tucker, vice-president (sales) of Ford India, said. We plan to grow our business in B (small) cars globally, especially in the Asia-Pacific region where we plan to raise the share of B cars from 15 per cent to 45 per cent, he said.
The car will be made with 85 per cent local components, with the vendors located within the 352-acre plant in Maraimalai Nagar, about 50 km from Chennai.
Ford has set up a new engine plant at Chennai and is doubling its capacity to 2 lakh units per annum, as part of a $500-million fresh investment plan for the country, announced earlier. The plant presently produces only 30,000 units and works a single shift, while the installed capacity is for three shifts.
The expansion is expected to turn Chennai into a strategic production hub at a competitive cost for Fords global operations. The company is looking to save 15-20 per cent on engine costs after developing a local vendor base in Chennai.
With the proposed investment, the plant will attain 30 per cent automation. Ford has deployed 66 robots in the factory. http://www.telegraphindia.com/1090907/jsp/business/story_11460214.jsp
VOLKSWAGEN PLANS TO DOUBLE INDIA HEADCOUNT PTI See this story in: The Hindu Business Line (Web Edition), Hindustan Times (Web Edition), The Indian Express (Web Edition), The Pioneer (Web & Print Edition), Business Standard (Delhi Print Edition) (Sept 07)
New Delhi: Europe's largest car maker Volkswagen is planning to more than double its India headcount with addition of 1,500 employees at its Chakan plant alone in Maharashtra.
The group, which started production at Chakan near Pune in March 2008, is looking at full-capacity production at this plant by 2012 and would need to increase its staff strength for the same, its India head said.
Volkswagen has two facilities in India at Aurangabad and Chakan, which assembles cars of its three brands -- Skoda, Audi and Volkswagen. We opened our Chakan facility this year and it is producing Skoda Fabia now, but in small numbers. When we will lau nch the small car Polo next year, the numbers will increase,'' Volkswagen Group India President and Managing Director Joerg Mueller told PTI.
The company is now undertaking pre-production testing of Polo at the Rs 3,800-crore Chakan plant, which has an annual capacity of 1.10 lakh units. Currently we have about 1,000 people employed with the group. We will require a strength of 2,500 employe es once the plant will start production at full capacity in the next 2-3 years,'' Mueller said. The company would increase its headcount to 1,200 by the end of this year, he added. Mr Mueller also said the group is eyeing 8-10 per cent stake in the Indian passenger car market in the next 5-6 years from a minuscule share now and would consider to integrate after-sales service of its three brands in India for better synergy.
The company has announced that it would launch its small car Polo early next year in both petrol and diesel variant.
Currently small cars with less than 4 metres in length and displacements up to 1200cc for petrol and 1500cc for diesel engines attract 8 per cent excise duty in India. On its concept car UP!, Mr Mueller said the company is currently developing the model for the European market where it would be launched by 2011. It (Up!) is a car for big metros and it can be a very interesting car in India as well. But we have not fi nalised to launch it here,'' he added. http://www.thehindubusinessline.com/blnus/02061533.htm http://www.indianexpress.com/news/volkswagen-for-2fold-raise-in-headcount/513576/ http://www.dailypioneer.com/200794/Snapshots.html
The Hindu (Metro Plus)
Presence, performance, price, practicality Toyota Fortuner has everything an SUV buyer looks for, writes Ouseph ChackoThe arrival of the Fortuner in India stirred up a frenzy. With 2,000 confirmed bookings so far, its clear that this SUV has enormous potential of being a hit in the big car market.
But, does the Fortuner live up to its perceived greatness? Has it really been worth the wait? This road test holds the answers.
Stationed next to an Endeavour, the Fortuner is taller and more broad shouldered. The Fortuners chest-level bonnet towers over you the huge scoop on the bonnet that feeds air to the air-to-air intercooler, the skid plate that swoops into the bumper, and the terrific-looking headlights that sync into the grille demand much respect. The massive wheel arches, filled by huge Dunlop Mud and Snow tyres, a high waistline and a footboard to step into the car goes to show that this SUV means serious business. The high bumper line that shows off the massive 221-mm clearance is testament to the Fortuners off-roadability. The spare wheel on this car is mounted under the boot, as compared to the generic spare wheel-sporting tailgates of traditional SUVs.
A standard-fit five-speed manual gearbox delivers drive to all four wheels all the time. Independent double wishbones up front, a non-independent four-link setup at the rear and coil-springs all round keep the Fortuners 1,955 kilo kerbweight beautifully balanced. Brakes are discs up front and drums at the rear.
Once in the drivers seat, the high-roller feeling you get as you look down into other smaller cars is fantastic. The Fortuners seats are supportive and very comfortable. Theres good space, and its quite easy to get comfy behind the wheel the seat adjusts (manually) for height and the steering for rake.
Quality of the plastics, switchgear and overall fit and finish are top notch. Equipment-wise, two airbags, ABS, 17-inch alloy wheels, a six-CD changer, climate control, remote locking and leather seats come standard.
We loved the little cubbyholes under the air-con vents and the big box between the front seats. The middle row makes enough room for six-footers to sit comfortably, and the seats offer good thigh support and adequate cushioning. The Fortuner gets a seven-seat layout, with the third row occupying most of the available boot space when in place and theres still enough luggage space for a couple of small soft bags. Getting into the last row involves a two-step operation to get the middle row out of the way. The second-row seats can be moved forwards or backwards on runners, meaning that legroom can be sufficiently divided among rear occupants. On folding the seats (the last row splits 50:50) you get a very useable 1,000 litres of storage space.
It took the Forturner just 12.7sec to reach 100kph from still quite stunning for a vehicle that weighs nearly two tonnes. Theres a gentle and consistent surge as the turbo starts to tug at 1500rpm and theres power all the way to 4000rpm. The gear ratios are well-matched to the engines torque and the wide powerband minimises the need for gearshifts.
Aided by the variable geometry turbocharger, Toyotas second-generation 2982cc D-4D engine makes a claimed 168bhp at 3600rpm and 35kgm of torque all the way from 1400-3400rpm. This long-stroke motor has a four-valve, twin-cam head and three-injections per cycle controlled by a 32-bit processor.
What is very Innova-like is the SUVs gearshift, with its wide gate and long throws. The transfer case high-low is also operated with a traditional lever, which sits on the outside of the gear lever. Theres even a centre differential lock, which splits torque between the front and rear axles.
At high speeds, the Fortuners big wheels and the suspension humble dicey roads into submission. The SUV lolls around in corners, rolls quite a bit, and though there is plenty of grip from the four-wheel-drive system, its rather tiring to hustle its 1,955 kilos. The car rolls to a complete stand-still in a respectable 28 metres, but theres serious brake fade after just a few hard stops.
The low-stressed D4-D engine returned 9.3kpl in the city and 12.9kpl on the highway, impressive figures for a car its size and weight.
Verdict Has the Fortuner been worth the wait? The simple answer is yes. From road presence, strong performance, space and practicality, its got everything the prospective SUV owner is looking for.
What sweetens the deal is the security of Toyotas reliability, and for once an attractive price of Rs 18.45 lakh (ex-showroom Delhi) for a fully loaded model.
Technical data Fuel Diesel Installation Front, longitudinal Type 4cyls in-line, 2982cc Common-rail, direct-injection, turbo-diesel Bore/stroke 96.0/103.0mm Compression ratio 17.9:1 Power to weight 87.46bhp per tonne Torque to weight 17.90kgm per tonne Specific output 57.34bhp per litre Transmission type Four-wheel drive Gearbox 5-speed manual Weight 1955kg Wheels Alloy Tyres 265/65 Dunlop Grandtrek AT20, tubeless Spare Full-size Suspension Front Independent, double wishbone, coil springs Rear Non-independent, 4-link with coil springs Steering Type Power-assisted rack and pinion Turning circle 11.8m Brakes - Front 297mm ventilated discs Rear Drums Anti-lock Yes http://www.hindu.com/mp/2009/09/02/stories/2009090250410300.htm
The Hindu (Metro Plus)
Rolls-Royce has confirmed the performance figures for its new Ghost luxury saloon that is being launched at the Frankfurt Motor Show. At the heart of this Ghost lies a brand new 6.6-litre, turbo-charged, V12 engine mated to a brand new eight-speed ZF automatic gearbox that produces 563bhp. The Ghost rolls from 0-100kph in just 4.9 seconds and then onto a governed top speed of 250kph.
According to Rolls-Royce director of engineering, Helmut Riedl, First and foremost, the Ghost is a Rolls-Royce. This means that despite its extraordinary performance figures it has been engineered for effortless composure and refined power delivery.
Rolls has already confirmed that the Ghost will ride on an intelligent four-corner air suspension system using multi-link aluminium front and rear axles. The fully integrated system allows each of the Ghosts dynamic handling systems to work together providing optimum levels of refinement and comfort at all times. The RR Ghost will be priced at around the Rs. 2.5 crore mark, when it comes to India somewhere in the second quarter of 2010. http://www.hindu.com/mp/2009/09/07/stories/2009090750200300.htm
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| COMMERCIAL VEHICLES Go To Top | |
| CONSTRUCTION & AGRI MACHINERY Go To Top
The Times of India (Sept 07)
New Delhi: Tractor makers are dissastisfied with PSU bank financing in rural areas and say that retail loans remain expensive and difficult to get despite the increased liquidity in the banking system. Worried over the fallout from a poor monsoon, they have sought help from the government to facilitate increased financing by banks for tractors and agri equipments. http://timesofindia.indiatimes.com/news/business/india-business/Tractor-companies-rue-tight-financing/articleshow/4979833.cms
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| 2/3 WHEELERS Go To Top Chanchal Pal Chauhan The Economic Times
New Delhi: Hero Hondas plan to expand its plant at Haridwar in Uttarakhand has hit a roadblock with the state development agency threatening to cancel the allotment of 94.5 acres of land due to non-payment of arrears. State Infrastructure and Industrial Development Corporation of Uttarakhand Ltd (Sidcul) has threatened to cancel the land allotment if the worlds largest two-wheeler maker by volumes fails to pay Rs 50 crore by September 15. The company said Sidcul demand is much higher than its own estimates but hoped it can settle the issue through negotiations. The 18-month-old Haridwar unit accounts for one-third of the 3.5 lakh twowheelers Hero Honda produces every month across its three plants in India. It plans to ramp up the production here to 6,000 bikes per day to extract higher profits from this tax-free zone. The land under dispute is key for any capacity expansion. While Sidcul has demanded that the company pay for the entire land plus a penalty on late payment, Hero Honda claims it is liable to pay only for 54 acres on which its new plant will come up, or about Rs 22 crore. As per our estimates, the industrial area, leaving roads etc, is much less than the Sidcul estimates, a company spokesman said. According to a state government order in 2006, there was no need to pay for land left for roads and infrastructure facilities, he said. However, we are still willing to negotiate and settle to pay something for the disputed land with Sidcul on a mutually agreeable acreage of land, the spokesman said. By depositing earnest money for the entire land, they acknowledged their ownership on the entire stretch and are liable to pay for the whole allotment, said a senior official at Sidcul head office in Dehradun. The Haridwar plant set up with an investment of Rs 1,900 crore (including ancillaries) helped Hero Honda to improve its profit margins as it came with a slew of tax incentives including zero excise duty for first 10 years, 100% income tax exemption for first five years and 30% exception for the next five years. The company improved its operating margins to 18.12% in the quarter ended June from 13.64% a year earlier as it increased production of top selling bikes Splendor and the Passion at Haridwar. The company reported a 83% jump in net profit at Rs 500 crore in the quarter.
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| COMPONENTS Go To Top See this story in: The Indian Express, Deccan Herald (Sept 07)
New Delhi: Auto parts maker Bosch said it expects to grow by 20 per cent this year in its automotive after-sales business in India, despite cheap Chinese imitations affecting its revenue by almost one-third.
"In 2008, we had a turnover of Rs 1,000 crore from our automotive aftermarket business. So far this year, we have grown about 23 per cent and we are confident of attaining 20 per cent jump in this year," Bosch Vice-President (Automotive Aftermarket) K Ravi told reporters. He said the expected growth would come despite illegal shipments of huge quantities of auto parts made in China, which are sold in India under Bosch brand.
"The Indian after-sales market is estimated at Rs 15,000 crore and almost 40-50 per cent are fake products... Our business has been affected to the extent of 33 per cent due to this," Ravi said.
The company destroyed 1.34 lakh units of spurious spark plugs, worth Rs 60 lakh, at Ghaziabad following permission from the Delhi High Court. The products had been imported from Hong Kong under Bosch's label two years ago.
"We have been undertaking joint action in cooperation with police forces of various states to crack down on sale of spurious imported items. Last year, we helped in conducting 701 raids at various establishment leading to 669 arrests.
This year we have already conducted 633 raids and arrested similar number of people," he said. http://www.indianexpress.com/news/bosch-aims-20-jump-in-its-after-sales-biz/513574/ http://www.deccanherald.com/content/23705/bosch-aims-20-pc-jump.html
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| ALLIED INDUSTRY Go To Top John Sarkar (Sept 06)
Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved"
THE STRIKES AT THE PLANTS COST US 1000 CRORE: CMD, MRF Chandra Ranganathan (Sept 06)
Excerpts from the interview: Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved"
'WE HAVE AN OPEN HIGHWAY': MD, APOLLO TYRES John Sarkar (Sept 06)
What has been your learning from overseas markets? Technology. But other than that, from Europe we have learnt about the service aspect. Tyre makers there are very serious about loyalty programmes. And now, even we are focussing a lot on it here. From SA, we have learnt a lot about work culture and man management. Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved"
APOLLO TYRES EYES GROWTH, GLOBAL TOP 10 SLOT IN 5 YRS Hindustan Times
New Delhi: Gurgaon based Rs 4,985-crore Apollo Tyres is in an expansion mode, and looking for acquisitions outside India as a route to increase its presence in the global market. At present, the company has presence in Europe and Africa.
We are looking out, we have the appetite to acquire companies with synergies outside India, Onkar S Kanwar, chairman, Apollo Tyres said. He however refused to divulge in further investment detail. In March, 2009, Kanwar acquired a Netherlands based company which manufactures high end passenger car tyres.
Kanwar added that the focus of the company is to expand global reach through both organic and inorganic growth. "We want to grow and we are looking at organic and inorganic growth," he said. Apollo Tyres is also building a greenfield plant near Channai with an initial capacity of 150 tonnes. The plant is expected to be operational by the end of the year. The company also has plants in South Africa. Currently, about 70 per cent of its revenues come from India.
Kanwar said that the target is to touch a turnover of $2 billion by 2011. We want to expand and be among the top 10 tyre manufacturers across the globe in the next five years, he said, adding that the companys position is 16th at present. The company has been focusing heavily on the replacement tyre market both in India and outside India with 75 per cent of the revenue coming from this segment.
However, Kanwar said that the export market, which had been affected by the global slowdown, is yet to pick up. Apollo, Vredestein and Dunlop are the key brands of the company.
Sambit Saha The Telegraph (Sept 07)
Calcutta: ArcelorMittals experience with Uttam Galva will come in handy when the worlds largest steel maker builds its two massive plants in the country.
Sudhir Maheshwari, member of the group management board of ArcelorMittal said Uttam Galva would provide key knowledge about the domestic market. You can say, it will be a good build-up to the day when we start our integrated facilities in Orissa and Jharkhand, he said.
Speaking to The Telegraph from London, Maheshwari a key aide of ArcelorMittal chairman Lakshmi Niwas Mittal said working with Uttam Galva would also make the steel giant a known entity among industry and trade before the two massive 12 million-tonne plants came up. It will give us insight into the market an understanding of local buyers and their demands. It would help us plan our strategy with the two integrated plants, he said.
Maheshwari, however, said the new facilities would be built by Mittals wholly owned subsidiaries, and Uttam Galva would not be involved. We were keen to have a presence in India as it is a growing market. This transaction has provided an opportunity for that, he said.
The Luxembourg-based company plans to use the marketing and distribution network of Uttam Galva to sell its own products. As of now, the two companies will chalk out strategies for growth.
Uttam Galva makes galvanised and cold-rolled products that are consumed by the white goods and auto sector, and ArcelorMittal will assist it in technology. Uttam Galvas sales stood at around a million tonnes last year.
As we join the board as a co-promoter of the company, various growth issues will be discussed, Maheshwari said. He said ArcelorMittal did not look at any company other than Uttam Galva, and it would be wrong to assume that it would be the beginning of a series of acquisitions.
L.N. Mittal himself had talked about the lack of acquisition targets in the country. None of the top five integrated players was up for sale. Secondary steel producer Uttam Galva had provided a rare opportunity to him. http://www.telegraphindia.com/1090907/jsp/business/story_11460212.jsp
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| RISE IN AUTO LOAN RATES TO DENT RECOVERING SALES Mahalakshmi Hariharan, Shweta Bhanot The Financial Express See similar story in: Yahoo India (Sept 07)
Mumbai: Automobile companies are examining a new threat to the recent rebound in their sales growth. That is the spectre of a rise in interest rates for loans to finance commercial and passenger vehicles, possible within the third quarter of this financial year. As a response to the likely rise in auto loan interest rates, automobile companies are planning measures such as heavy discounts, special schemes and arrangements with banks to cash in on the demand during the festive season.
If interest rates firm up by over 100 basis points, auto companies will look at offering heavy discounts to customers to increase sales. With the festive season around the corner, they may also look at roping in banks and dealers to offer special discounts to customers. We are already seeing big auto companies coming to us, especially for two wheelers in rural areas, said V Ravi, chief financial officer with Mahindra & Mahindra Financial Services Limited. Figures from Society of Indian Automobile Manufacturers shows domestic sales of passenger vehicles has risen 9.45% year-on-year between April and July this year. Sales of commercial vehicles (bus and goods carriers) were up 16%. But this is far lower than the growth rate of last year and thats worrying the auto companies.
Any increase in interest rates is a bad news for the auto sector, which, of late, has been showing signs of growth. The industry is showing some signs of recovery and any upward movement of interest rates will be a bolt on the industrys growth chart, said Mayank Pareek, executive officer, marketing and sales at Maruti Suzuki India Limited.
The options before the industry are not too many to counter such a rise. And Ravi said playing around with the monthly installments was difficult, as auto loans are not extended beyond five years. It also depends on how much interest rates firm up.
Currently interest rates on loans for passenger vehicles hover between 11% and 12.5%, while it is 11% to 13% for commercial vehicles. The latter segment depends heavily on bank loans (about 95%) and would, therefore, take the brunt of any interest rate hike. For passenger vehicles, the dependence is around 60%, said an ICICI Bank official with the auto loan division.
Confirming the likelihood of an increase in rates, Ashok Khanna, executive vice-president and business head in-charge of auto loans at HDFC Bank, said, There will be a spike of interest rates across the board by at least 50-100 basis points in the next two to three months.
Ravi also said the market anticipates interest rates would go up by 50-100 basis points by October-end. Speaking to FE, dealers from the Federation of Automobile Dealers Association said they too were expecting interest rates to go up in the next one and a half months. The commercial vehicle segment could, however, see a lower rise as the government will look at promoting their sales to meet the expected demand to service the infrastructure sector.
According to the Reserve Bank of India, overall credit growth across industries has witnessed a drop to 14.89% for the fortnight ending Aug 14, 2009, as against 15.79% for the fortnight ending July 31, 2009. Auto loans constitute about 15-16% of the total retail loans for the banking sector.
The industry is, therefore, hoping to see a growth of around 25% during the festive season to counter the possible dip in sales thereafter. Banks will let the festive season pass through, since it will act as the barometer to decide the quantum of rise in the interest rates, said VG Ramakrishnan, director, automotive and transportation, Frost & Sullivan, South Asia and Middle East. He added that the consumer spending has not gone up as expected despite the liquidity condition seen at comfortable levels.
It is expected to further fall in January, when the inflation will be in full swing and so will be the interest rates. http://www.financialexpress.com/news/rise-in-auto-loan-rates-to-dent-recovering-sales/513755/2 http://in.biz.yahoo.com/090906/50/bau58k.html
MOTOR COVER DRIVES UP GENERAL INSURANCE SECTOR GROWTH The Hindu Business Line (Sept 07)
Mumbai: The general insurance industry grew at 14 per cent in the month of July, riding mainly on sales of motor insurance policies. In July, passenger vehicle sales grew at 29.1 per cent and commercial vehicle sales grew at 9.6 per cent. Hence, sales of motor insurance policies increased in sync.
In the reporting month, gross written premiums (GWPs) of the public sector insurers stood at Rs 1,680 crore, up by 13.5 per cent. Private sector players GWPs grew 14 per cent at Rs 1,176 crore. State-owned players such as United India Insurance, New India Assurance and Oriental Insurance posted double-digit growths. National Insurance was the only public player to have a single-digit growth.
Even as the public sector players posted a good growth, the two big private players ICICI Lombard General Insurance and Bajaj Allianz General Insurance registered negative growth.
We have consolidated our position in the market. Most of our business segments have seen good growth, with motor and fire growing at a good rate, said a Oriental Insurance Company official.
The market is picking up. Though we have seen some slowdown in the travel insurance segment, motor insurance is picking up, said Mr Gaurav Garg, Managing Director and CEO, Tata AIG General Insurance.
Tata AIGs GWPs was down 2 per cent. The two standalone health insurers Star Health and Allied Insurance and Apollo DKV clocked good growth.
The Export Credit Guarantee Corporation of Indias GWP increased to Rs 259.49 crore (Rs 59.54 crore) while Agricultural Insurance Companys GWP grew 66.6 per cent to Rs 101 crore. http://www.thehindubusinessline.com/2009/09/07/stories/2009090750521000.htm
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| OIL, LUBRICANTS & ALTERNATIVE FUELS Go To Top | |
| INTERNATIONAL NEWS Go To Top Reuters See this story in: The Economic Times (Sept 06)
http://economictimes.indiatimes.com/News/International-Business/Peugeot-Citroen-sees-Europe-car-market-recovery/articleshow/4976391.cms
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| MARKETS SHED OVER ONE PER CENT Agencies See this story in: The Financial Express (Sept 06)
Analysts said the market is expected to consolidate at current levels in the absence of any major trigger and once breached the 16,000 strong resistance, it may get a rally.
India's industrial production data and monsoon rains, which has shown signs of revival in the past few days, apart from global trend will influence the domestic markets.
In the week till Sep 5, after a surge of 291 points on Friday, the Bombay Stock Exchange 30-share barometer ended the week lower at 15,689.12, registering a net fall of 233.22 points or 1.46 per cent from its last weekend's close.
The broader 50-share Nifty of the National Stock Exchange also finished the week down 51.95 points or 1.10 per cent at 4,680.40 from its previous weekend's close.
Foreign Institutional Investors pulled out Rs 904 crore in the initial four days of the week under review. They had pumped in more than Rs 4,900 crore during August.
On the global front, the US stocks scored impressive gains on Friday despite the unemployment rate jumped to a 26-year high of 9.7 per cent in August. http://www.financialexpress.com/news/markets-shed-over-one-per-cent/513331/
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Wednesday, September 9, 2009
Indian Auto Industry Update September 07, 2009
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