| INDIAN AUTOMOBILE INDUSTRY This Update also carries stories featured on Friday, October 02, 2009 | |
| INDUSTRY Festive frenzy drives auto sales Auto majors set hopes on Diwali INTERVIEWS/FEATURES 'We fear we may fall short of units to sell in India': Rod Wallace, Managing Director, Precision Cars India CARS, SUVs, MUVs Festive demand raises Hyundai sales to its highest ever Nissan unfazed by Marutis dominance in small cars Maruti: Desirable but not cheap M&M utility vehicle sales grow 36.75 pc in September GM India sales jump 48.51 pc in September Porsche dealers in 6 cities by next year Nissan to manufacture global car in Chennai Merger with VW not to impact Porsches India operations Volvo cars make their entry in Kochi Super-sedan Panamera comes to India COMMERCIAL VEHICLES Ashok Leyland's Pantnagar plant to go onstream soon To roll out low-floor buses faster, Ashok Leyland sets up new plant DTC buses to have climate control, chargers CONSTRUCTION & AGRI MACHINERY 2/3 WHEELERS Bajaj Auto sales rise 14% in September Bajaj Auto to phase out CNG one tonner 3 wheeler in Gujarat India Yamaha Motor sales rise over two-fold in September We aim to build end-to-end global two-wheeler business: Anoop Mathur, President, 2-wheeler sector, M&M COMPONENTS | ALLIED INDUSTRIES Sales overdrive sends auto financing to two-year high General insurers expect 10% growth in premium this year Insurers look to raising motor third party insurance premium IFCI offloads Tata Motors shares OIL, LUBRICANTS & ALTERNATIVE FUELS Oil falls below $69 after US employment data INTERNATIONAL NEWS Japanese automakers see Hyundai as global threat ECONOMY & FINANCE
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| INDUSTRY Go To Top Chanchal Pal Chauhan The Economic Times (Web & Print Edition) (Oct 02)
New Delhi: Hyundai, Honda, General Motors and Ford sold record number of cars in a month in September as buyers more confident of jobs and bonuses than last year lapped up cheap financing schemes offered by banks flooded with deposits. But Maruti, which accounts for about half the cars sold in the country, missed the monthly record as it suspended production of the SX4 sedan. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved"
FESTIVE FRENZY DRIVES AUTO SALES Business Standard (Web & Print Edition) (Oct 02)
New Delhi/Mumbai: Increasing festive demand, coupled with favourable interest rates and attractive offers, helped the auto industry post a double-digit growth in September. Even the traditionally slow Shradh period (during which most consumers, especially in the north, do not buy cars) was not able to dampen the spirit, as consumers continued to book vehicles, albeit they took deliveries after the Shradh period concluded, making no dent in overall numbers.
Manufacturers such as Maruti Suzuki, Hyundai Motors, Mahindra & Mahindra, Tata Motors, General Motors, Honda Siel Cars and SkodaAuto managed to comprehensively surpass their total sales posted in the same month last year. However, analysts were quick to point out that the low base of last year also helped the auto giants.
Domestic sales of Maruti Suzuki, Indias biggest car maker, grew by 10.7 per cent to 71,594 units in September, compared with 64,682 posted in the corresponding month a year ago. Robust demand for new models like A-Star and Ritz, as well as other models like Swift and DZire, lifted overall sales. However, demand for the SX4 sedan and the M800 continued to decline.
Maruti Suzuki Chairman R C Bhargava said: Most consumers had no problems in booking during the Shradh period, while taking delivery after the period. We continued to create inventory and obviously most of the deliveries were bunched up in the last few days of the month.
Sales of Korean car brand Hyundai Motors India (HMIL) rose by 25 per cent to 27,803 units last month from 22,311 units in the same month last year. Demand was primarily driven by the hatchback range of i10, i20 and Santro models.
HMIL Senior Vice-President (Marketing and Sales) Arvind Saxena said: Sales for the month of September were promising, as we not only recorded the highest figures in our 11 years of operations but also, this year, the festive season has been encouraging as customers returned to the showroom. We hope this will be the turning point for the automotive industry and if sales remain strong during the coming Diwali, then we can look at double-digit growth figures for the current year.
Tata Motors, Indias third-biggest car manufacturer, posted a growth of 9.6 per cent at 18,176 units in September, with dispatches of the Nano accounting for 2,524 units. Sales in the same month a year ago stood at 16,586 units. Growth was also posted by the companys Indica model, where it sold 9,858 units.
In addition to the festive sales, continuation of the improving car sales comes on the back of new car models that were launched since the end of last year. Marutis Ritz and A-Star continue to bring in volumes. Sustained economic growth, PSU banks offering car loans at 8 per cent and the upcoming festival of Diwali will all aid in helping the industry sustain momentum in the second half of the financial year, Angel Brokings Senior Analyst Vaishali Jajoo said.
Meanwhile, strong demand for the Xylo (multi-utility vehicle) and Scorpio helped Mahindra & Mahindra, the countrys biggest utility vehicle maker, to post a growth of 36.75 per cent at 21,961 units during September against 16,059 units in the same month last year.
Sales of the Logan sedan, which is jointly manufactured by Mahindra and French partner Renault, fell by 71 per cent to 510 units compared with 1,752 units last year, stated a release from the company.
Similarly, the manufacturer of the Chevrolet badged cars, General Motors, sold a record 7,654 cars and utility vehicles in September this year, which is a 49 per cent rise over the sales achieved for the same month last year. The company says there is brisk demand for its entry compact car, Spark, the sales of which alone grew by 128 per cent, selling 4,706 units last month.
Japanese car giant Honda sold 5,794 cars in September, which is a growth of 87 per cent against same-month sales last year, when its total sales stood at 3,104 units. SkodaAuto India, meanwhile grew by 53 per cent on the back of the good performance of its executive cars, Skoda Laura and Octavia selling 1,854 cars.
Emkay head of research Ajay Parmar said: All companies reported higher dispatches following the surge in retail demand during the festive days of last month. It is the retail space where the numbers are impressive. The momentum seen in the year so far may see a minor correction in the coming months. However, it wont be a complete slowdown. Interest rates are not expected to hurt off-takes as consumers nowadays do not mind spending a few extra in their EMIs, he further added. http://www.business-standard.com/india/news/festive-frenzy-drives-auto-sales/371944/ Auto majors see smooth sailing on festival The Financial Express (Web & Print Edition) http://www.financialexpress.com/news/auto-majors-see-smooth-sailing-on-festival-buying/523937/2 Festivals, low interest rates drive auto sales Mint (Web & Print Edition) http://www.livemint.com/2009/10/01173606/Festivals-low-interest-rates.html Car, bike sales drive in top gear The Times of India (Web & Print Edition) Auto majors set hopes on Diwali Hindustan Times (Web & Print Edition) Car sales zoom in festive mood Daily News & Analysis (Web Edition) http://www.dnaindia.com/money/report_vehicle-makers-kick-off-festival-season-with-bang_1294333 Vehicle makers kick off festival season with bang Deccan Chronicle (Web Edition) http://www.deccanchronicle.com/business/auto-majors-set-hopes-diwali-609 Auto majors set hopes on Diwali Asian Age (Delhi Print Edition) Return to fast lane for auto industry The Indian Express (Delhi Print Edition) Momentum continues; auto sales surge Car sales zoom in festive mood Hindustan Times (Delhi Print Edition)
AUTO MAJORS SET HOPES ON DIWALI Deccan Herald (Web Edition) (Oct 03)
Mumbai: The Indian automobile manufacturers not only witnessed a growth in sales in the range of 11 to 53 per cent in September compared with the same period last year, but some companies crossed the milestones during this month. General Motors India registered a growth of 49 per cent and its Cheverolet Spark has registered the highest sales of 4,706 units in one month since the introduction of the car. Maruti sold 71,594 units from 64,682 units in September last year. Exports of the company surged by 85.4 per cent to 11,712 units from 6,318 units in the year-ago period. http://www.deccanchronicle.com/business/auto-majors-set-hopes-diwali-609
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| INTERVIEWS/FEATURES Go To Top The $6.3-b Mahindra Group, seems to be on a roll. While the automotive sector has notched up its highest-ever sales in the domestic market in September, tractor sales have been able to shrug off a disappointing monsoon. ET NOW caught up with Rajesh Jejurikar, COO, automotive sector, M&M, to figure out the road ahead.
Excerpts:
You have seen robust sales in September. What have been the key contributors?
Yeah, first I would like to say we are delighted with September numbers. It is our highest-ever sales figure in the domestic and the overall sector. So, in domestic, we have done 27,400 vehicles and the total including exports has been 28,200. The other thing, I would like to highlight is that our utility vehicle portfolio, which is the core of our business, has grown by 37% in September. This is a continuation of what we have done in the past few months, where the three brands, Scorpio, Bolero and Xylo, in this portfolio and the pick-up range, are doing extremely well. It is really this portfolio, which has led this growth for us, and when we look at the total sector, the growth has been 12%.
Do you expect the demand to continue?
Well, we expect October to be good as well because the festive season is on right now. As supply side is not so good, there are shortages. This month we have had some key shortages, and outsourced for 3-wheelers as well as tyres for some of our products.
There is also fuel-injection pump shortage. A lot of the products are actually short, given the sudden spurt in demand. So, shortage is a sort of inhibiting factor right now, but the demand seems to be very good. http://economictimes.indiatimes.com/articleshow/5079189.cms
Swaraj Baggonkar Business Standard (Web & Print Edition) (Oct 02)
Mumbai: Luxury German car maker Porsche is upbeat on the India market, asserting that its growth has beaten the turnaround posted by many economies around the globe. The company that already offers the 911, Cayenne, Boxter and Cayman models in India launched on Thursday the Panamera sedan in the country, only five months after the car was launched globally. In a brief interview with Swaraj Baggonkar, Precision Cars India Managing Director Rod Wallace spoke about the companys strategy.
Excerpts:
Tell us about the car in brief...
You sold 168 cars last year. Was the figure lower than what was expected by the company? There is a difference between delivered and sold, as the build period of these cars can be anywhere between three and four months. As a practice, we do not hold large stocks of them in India. They have to be ordered directly from Germany. We have a few build slots at the Porsche facility available exclusively for the Indian market. Many of our Indian customers like to choose their own interior combination of leather and colour, so the delivery period varies.
What is the target for Panamera this year? We are selling 50 Panameras in India this year (Porsche follows August 1-July 31 year). We have already received bookings for 13 units. However, an order was placed by us 12 months ago when the economic turmoil was at its peak. But Indias GDP has recovered so well that we are afraid we may fall short of availability of units. We may have to ask for more Panameras later. The wait may get a little bit longer than the usual 3-4 months.
How many Porsches are you aiming to sell this year? Our earlier target was to sell 200 units this year and we are still sticking to it. So far, we have sold 135-140 units by end of September. A chunk of the total sales come from the Cayenne (an SUV). So the next three months are pretty important for us.
How do you gauge the impact of last years downturn? Our sales dropped by 23-24 per cent, which is pretty much what Porsche experienced internationally in 2008. This year, the company has already declared a production cut to 75,000 units from 98,000 units which was announced earlier. The demand, however, is coming back strongly now.
Are you hit by the surge in the value of the Euro? Import costs have always been a cause of concern for us. The import legislation of this country is not very kind either (110 per cent). We had taken a decision of dealing in dollars than in euros. But, yes, it has hit us badly. However, we have absorbed the impact so far.
Which cities are on your expansion list? We have two outlets currently, in New Delhi and Mumbai. We will be having centres in Hyderabad, Kochi, Bangalore and Chennai in the south and Ludhiana and Ahmedabad. Our target is to have centres in six cities by 2010. Porsche has electric plans for India Daily News & Analysis (Web Edition) http://www.dnaindia.com/money/interview_porsche-has-electric-plans-for-india_1294334
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| CARS, SUVs, MUVs Go To Top See this story in: The Indian Express (Web Edition) (Oct 02)
New Delhi: Car maker Maruti Suzuki India reported 17.3 per cent jump in sales for September at 83,306 units.
In the domestic market, Maruti sold 71,594 units from 64,682 units in September last year, an increase of 10.7 per cent, Maruti Suzuki India (MSI) said in a filing to the Bombay Stock Exchange.
Exports of the company surged by 85.4 per cent to 11,712 units from 6,318 units in the year-ago period, it added.
Sales of the company's once bread-and-butter model M800 declined by 7.5 per cent at 3,207 units compared to 3,467 units in September 2008, while A2 segment (comprising Alto, Wagon R, Estilo, Swift, A-Star and Ritz) witnessed growth of 15.1 per cent at 52,508 units compared to 45,621 units in the same month a year ago, the release added.
A3 segment sales (consisting of SX4 and DZiRE) decreased 0.8 per cent to 7,356 units compared to 7,413 units in the corresponding period last year, the company said. The production of its mid-sized Sedan SX4 was halted during the month for a change over to an upgraded version.
MSI's passenger car sales rose by 11.7 per cent at 71,368 units against 63,917 units in the same month in 2008, the filing said. http://www.indianexpress.com/news/maruti-sales-up-17.3-pct-in-september/523738/
The Financial Express (Web & Print Edition) (Oct 02)
New Delhi: Hyundai Motor India, the countrys second-largest passenger car manufacturer, registered its highest-ever monthly sales of 53,804 units in September. The 16.4% y-on-y growth came on the back of growing festive season demand and higher overseas sales. This is the first time that the company has crossed 50,000 units a month since it started operations in India 11 years ago.
While Hyundais domestic sales leapt 24.6% last month at 27,803 units, vis--vis 22,311 units in September 2008, its exports rose 8.75% at 26,001 units, against 23,907 units in the year-ago period. Though demand started picking up post-July, overall numbers were high in September primarily because of higher exports and increased footfalls in showrooms during Navratra, said Hyundai Motor India senior vice-president Arvind Saxena.
According to Saxena, the i20, which was launched last December, proved to be a significant contributor to the companys sales, along with the new Santro and Verna. While over 4,000 units of the i20 were sold in the domestic market last month, the company exported 8,522 units, accounting for 32.8% of the companys total shipments from the country.
While demand showed a positive trend even in August, it was only in September after the company started third-shift operations at its second plant in Chennai, that weve been able to meet demand and hence registered higher numbers, said Saxena. He feels that with strong customer enquiries, there is a possibility of similar numbers in the Diwali month of October as well.
This time, Navratra and Diwali are spread over two months and, hence, we can expect higher sales even in October. If that happens, Hyundai Motor India can expect to end the calendar year with double-digit growth, against the low single-digit estimated earlier, Saxena added.
Hyundai registered 49.6% overall growth in 2008 at 4,89,328 units, vis--vis 3,27,170 units in 2007. While domestic sales went up by 22.4% at 245,397 units, compared with 2,00,421 units in 2007, the company registered a growth of 92.5% in exports at 2,43,931 units against 1,26,749 units for 2007.
However, Saxena feels that only after October can it be determined whether the revival being seen across the auto sector is a sustainable one or not. http://www.financialexpress.com/news/festive-demand-raises-hyundai-sales-to-its-highest-ever/523985/ Hyundais Sept sale highest in 11 years The Hindu Business Line (Web & Print Edition) http://www.thehindubusinessline.com/2009/10/02/stories/2009100252210100.htm Hyundai posts highest ever monthly sales The Indian Express (Web Edition) http://www.indianexpress.com/news/hyundai-posts-highest-ever-monthly-sales/523731/ Hyundai Motor India Ltd records highest ever sales Hindustan Times (Web Edition)
NISSAN UNFAZED BY MARUTIS DOMINANCE IN SMALL CARS N. Ramakrishnan The Hindu Business Line (Web & Print Edition) (Oct 02)
Chennai: Nissan, which plans to launch its compact car in India in the first half of 2010, is not worried by Maruti Suzukis dominance in the countrys passenger car market. It is confident that it will get a 5 per cent market share in the next couple of years, once all its planned launches are complete.
The Japanese carmaker, whose greenfield plant near Chennai will start rolling out cars in May 2010, also believes that over time Maruti will lose its market share as customers shift to products that offer superior technology rather than let price influence their purchasing decisions.
This has happened in China and will happen in India too, according to Mr Colin Dodge, Executive Vice-President and Chief Recovery Officer, Nissan Motor Company. I suspect it will happen in India that the primary reason for buying a car is technology and not prices, he told journalists here recently. Till four years back, prices dictated the purchasing decision in China, but now customers were going in for cars such as the Nissan Teana (a luxury sedan sold by the company in India as fully imported units).
Making a dent Nissan on Thursday released the sketch of its global compact car. It will be produced in five countries including India, China and Thailand. This car will roll out from Nissans Chennai plant in May 2010 and will also be sold in more than 150 countries.
Over time, Suzuki will find it difficult to keep its current market share, Mr Dodge said and added that Toyota, Honda and Nissan and the German companies with the advanced technology cars at their disposal would slowly dent Suzukis market share. Wherever the three Japanese companies Toyota, Honda and Nissan entered the market, they regularly tend to gain market share, he said. There would always be a segment of the market that went in for entry-level cars, but the bulk would shift to higher technology vehicles.
It was because of this that Nissan continued to invest on new technologies, including green cars and fuel cell vehicles. That is why we are not going to back off from our technology investments, Mr Dodge said.
Diversion required Mr Gilles Normand, Corporate Vice-President (Africa, Middle East and India), Nissan Motor Co, said India had a strong unmet requirement for diversity in the market. To some extent the customer is asking for a little more choice. We are not aiming for 20 per cent of the market. We are only aiming for five per cent, he said.
Nissan believes that consumer behaviour and regulations, especially those relating to stricter emission norms, will change the market dynamics. Nissan also does not believe that small cars mean small profits. If a company is making small profits on a small car, it means that the cost base is wrong, is Nissans argument. http://www.thehindubusinessline.com/2009/10/02/stories/2009100251260300.htm
MARUTI: DESIRABLE BUT NOT CHEAP Shobhana Subramanian Business Standard (The Compass) (Oct 02)
Mumbai: The Maruti stock, which had a great run gaining 54 per cent in the last three months, fell by just under 3 per cent as the sales numbers for September didnt really throw up any big surprises. In fact, the volumes were disappointing because total sales in the home market were up just 10.7 per cent year-onyear compared with the rise of 29 per cent in August.
Indeed, a year-on-year growth of 11.7 per cent in the passenger car segment, in the home market, is actually below the 16.2 per cent year-on-year growth recorded for the period between April and September this year. And the growth in total sales, including exports, of 17.3 per cent year-on-year, is also far lower than the 23.8 per cent year-on-year posted for the April-September period.
Analysts point out that there could be some production constraints because its hard to explain why sedans such as the Sx4 and Dzire have seen a drop in volumes. Its possible that there are manufacturing issues even for other models but these should be sorted out, they believe.
As such, Maruti appears to be on course to deliver a growth in volumes, in the home market, of 15 per cent in the current year. Sales growth should come in at 20 per cent. For the first half of the year, domestic volumes are up 15.5 per cent.
With auto loans now cheaper and the economy now on the mend, the demand from the urban markets, which was earlier expected to be tepid, is apparently recovering. Sales from the top ten cities, which actually fell in 2008-09, had risen some 10 per cent in July and its likely the trend has sustained in August and September.
With over 50 per cent of Marutis customers in urban markets, a further revival in consumer sentiment in these areas can only mean more business for Indias biggest car maker. The companys position in the compact car segment is now even stronger with the refreshed Estilo, which followed the launch of the A Star in January and the Ritz in May. Maruti earns very high margins from the petrol version of the Ritz which qualifies as a small car and therefore attracts a lower excise duty. In the current year, the company is expected to turn in revenues of close to Rs 26,000 crore over the Rs 20,455 crore reported in 2008-09, an increase of over 25 per cent.
A better product mix, better operating leverage and lower royalty costs should result in an operating profit margin of around 12 per cent which means the net profits could grow by as much as 60 per cent over the Rs 1,219 crore posted last year. At the current price of Rs 1,651, however, the stock trades at just under 21 times estimated 2009-10 earnings and is not cheap. http://www.business-standard.com/india/news/maruti-desirablenot-cheap/371871/
M&M UTILITY VEHICLE SALES GROW 36.75 PC IN SEPTEMBER PTI See this story in: The Economic Times (Web Edition) (Oct 02)
New Delhi: Auto major Mahindra & Mahindra reported 36.75 per cent growth in domestic sales of its utility vehicles (UV) in September at 21,961 units against 16,059 units during the same month last year.
The company's exports, however, fell by 25.69 per cent at 703 units in September, from to 946 units during the corresponding month of 2008, Mahindra & Mahindra (M&M) said in a statement.
Three-wheelers sales also declined by 28.25 per cent at 4,262 units compared with 5,940 units in the corresponding period last year, it said.
The sales of light commercial vehicles decreased to 658 units in September 2009 from 730 units in the same month last year, down 4.38 per cent, the statement said.
Mahindra-Renault's sedan 'Logan' recorded 70.89 per cent decrease in sales at 510 units in August this year compared with 1,752 units in the same month last year.
M&M also reported a jump of 36.16 per cent in cumulative sales of UVs during the first six months of the fiscal at 1,04,000 units, as against 76,381 units during the same period of last fiscal.
Its cumulative exports during the April-September period, howoever, declined by 50.93 per cent at 3,007 units as against 6,128 units during the corresponding period of last year. M&M utility vehicle sales grow 36.75 pc in September Mint (Web Edition) http://www.livemint.com/2009/10/01175918/MampM-utility-vehicle-sales.html
GM INDIA SALES JUMP 48.51 PC IN SEPTEMBER PTI See this story in: Hindustan Times (Web Edition) (Oct 03)
New Delhi: Carmaker General Motors India on Th reported a 48.51 per cent jump in its sales at 7,654 units in September, the highest ever monthly sales registered by the company in the domestic market.
GM India had sold a total of 5,154 units during September last year. The company's small car Chevrolet Spark registered a more than two-fold jump in its sales at 4,706 units, the highest ever sales since its introduction, the company said in a statement.
The September sales also comprised 1,329 units of multi-utility vehicle Chevrolet Tavera, 753 units of hatchback Aveo U-Va, 424 units of the sedan Chevrolet Aveo, 319 units of the luxury sedan Chevrolet Optra and 123 units of Chevrolet Captiva.
"We are pleased to see such robust growth for all our car lines and we believe these world class products will further propel the Chevrolet brand in the market," GM India Vice-President P Balendran said.
The company said it is gearing up for a major drive to consolidate its position by appointing more dealers and authorised service outlets across the country. GM India sales jump 48.51% in September Mint (Web Edition) http://www.livemint.com/2009/10/01184702/GM-India-sales-jump-4851-in.html
PORSCHE DEALERS IN 6 CITIES BY NEXT YEAR PTI See this story in: The Telegraph (Web Edition) (Oct 03)
Mumbai: Precision Cars, the official importer of Porsche models in India, is planning to increase its dealer network from two to six next year, a top company official said. We are expanding our dealer network and want to have a presence in six cities by 2010, Rod Wallace, managing director of Precision Cars, told reporters after launching the Panamera on Thursday.
Precision has two dealers one in Mumbai and the other in New Delhi. It will soon have three more dealers, all in the south.
We have signed contracts with dealers in Hyderabad, Kochi and Chennai. These cities will have their local Porsche centres by the end of this year, Wallace said. The company is also in talks with potential partners for dealership in cities such as Ahmedabad, Ludhiana and Bangalore, he said.
The new Panamera will be available in three variants the S, the 4S and the Turbo. The others Porsche models sold in India are the 911, Cayenne, Boxster and the Cayman. The Panamera will increase our volumes in terms of sales in the country. The dealers have 13 confirmed orders of the Panamera even before it arrived in the market, Wallace said. Precision has ordered 50 units of the Panamera to sell in the country over the next nine months, he said. Porsche, which sold 168 units in 2008 in the country, is expecting higher sales in 2009. http://www.telegraphindia.com/1091003/jsp/business/story_11569024.jsp
NISSAN TO MANUFACTURE GLOBAL CAR IN CHENNAI PTI See this story in: Deccan Chronicle (Web Edition) (Oct 03)
New Delhi: Japanese car maker Nissan on Thursday revealed the sketch of its global compact car that would be produced in five countries, including India from next year.
The car, which debut is scheduled for March 2010 in Thailand, would be sold in over 150 countries across the globe and would be manufactured in four other countries including, China, besides India. Though it is still unclear as what standards the model will meet, but it is expected to qualify as Thailands first Eco-car. http://www.deccanchronicle.com/business/nissan-manufacture-global-car-chennai-610 Nissan reveals sketch of global compact car The Hindu (Delhi Print Edition) Nissan to manufacture global car in Chennai Asian Age (Delhi Print Edition)
Neha Rishi Daily News & Analysis (Web Edition) (Oct 03)
Mumbai: Honda tried to create the 'J' segment with the launch of its premium hatchback -- Jazz -- but after a rush of enquiries Jazz seems to be losing fizz not only to competition but also to the other Honda brand -- City.
Jnaneswar Sen, marketing vice-president of Honda Siel Cars India, said, "From the time we launched Jazz, we have seen City volumes go up. We have observed that when customers walk into dealerships with the intention to purchase Jazz, they land up buying City."
"As a result, even though we received 50,000 enquiries for Jazz since its launch in June, the conversions have only been around 4,000, whereas in case of City the enquiries and conversions are both on an upswing. In fact, Jazz has helped increase the volumes for City," he said. City, a saloon, costs Rs 1.25 lakh more than Jazz.
Jazz sales have been declining month on month. In June it were a little above 2,000 units, 1,037 in July, 1,029 in August and just 504 units in September. Hormazd Sorabjee, Editor, Auto Car India, said, " The problem with Jazz is its exorbitant pricing, due to which it is not only helping the customers go in for City by paying a lakh more but its is also making other cars in its competition like Hyundai i20 and Skoda Fabia look good. The other thing is the saloon versus the hatchback phenomena, people are seeing more value in City and they wouldn't mind paying a little extra and get a saloon over a hatchback."According to Ashish Nigam, analyst, Antique Broking, "The market for premium hatchbacks is still very small in India and the pricing of Jazz plays to its disadvantage."
Mahantesh Sabarad, senior research analyst, Centrum Broking, said that besides the car being extremely expensive, it is also underpowered with a 1.2 litre engine. "A typical customer who has a sub Rs 5 lakh hatchback and is looking for an upgrade with Rs 8 lakh budget will naturally go in for a better powered City with a 1.5 litre engine than spending a huge amount to again purchase a hatchback. On the other hand, if we look at City, which is in the Rs 8 lakh plus segment, the only other competition is from Fiat's Linea. After the initial spurt in Linea sales, there is a slump as it is underpowered with a 1.3/1.4 litre engine, thus boosting City sales again."
A Honda dealer, who did not wish to be named, said that since the launch of Jazz, they have witnessed a 30% increase in City sales. "People come enquiring for Jazz but ultimately settle down for City, especially after the refreshed version of the same was launched in September. However, in the last few days we are seeing the upgrades from Jazz to City are reducing, maybe people have started to understand what the Jazz category is."
Honda Siel had been operating on a single shift since last year due to declining sales, and according to Sen, "since September we have resumed operating on double shift as we are facing delivery constraints, which is adding to our backlog. City, which constitutes close to 70% of our total sales volumes, has a backlog of three weeks."
Currently, the company in a single shift produces 5,000 units monthly. Sen said, "The situation is better now but still very fluid. In June we had reduced production of City in order to meet the demand for Jazz, and in July we have reversed this trend." Will the underperformance of Jazz force Honda to fast-track the launch of its small car? According to the company, however, the launch is still 2 years away. http://www.dnaindia.com/money/report_why-honda-jazz-is-not-selling_1294675
MERGER WITH VW NOT TO IMPACT PORSCHES INDIA OPERATIONS Manu P. Toms The Hindu Business Line (Web & Print Edition) (Oct 03)
Mumbai: Porsches India operations will remain independent even after the merger of its global parent with German car-maker Volkswagen, said Mr Rod Wallace, Managing Director, Precision Cars India, the exclusive importer of Porsche cars.
The merger is due to happen in 2011 and VW will initially pick up a 42 per cent stake in Porsche. I have an assurance from the group that the Indian operations of Porsche will remain independent, Mr Wallace told Business Line. Precision Cars India imports Porsche cars and distributes them to dealers in Delhi and Mumbai.
The VW group includes Skoda and Audi, which are both present in India though with exclusive identities. Each has its own retail and brand strategies.
It is only on the manufacturing side that there are synergies in terms of using the plants in Aurangabad and Chakan.
Three more dealers have signed up with Precision Cars India to set up showrooms in Chennai, Kochi and Hyderabad. Talks are on with others in Ahmedabad, Ludhiana and Bangalore.
Panamera launched The company launched the luxury four-seater Panamera here on Thursday. Its price ranges from Rs 1.44 crore to Rs 2.05 crore and is available in three variants. Porsche also retails the Cayenne and the Boxter in India. Precision delivered 168 Porsche cars last year and Mr Wallace says the number will be higher this year. http://www.thehindubusinessline.com/2009/10/03/stories/2009100350230200.htm
VOLVO CARS MAKE THEIR ENTRY IN KOCHI The Hindu (Web Edition) (Oct 03)
Kochi: Volvo cars have made an international mark for luxury and comfort and there are a number of automobile enthusiasts eager to possess one.
With an increasing number of people who can afford to buy luxury cars, the demand for outlets selling such cars has been on the rise.
With the opening of a new showroom, MGF Auto, here on Wednesday, Kochi has become the latest centre for buying Volvo cars. The launch will facilitate many of the aspiring buyers to possess them from the only sales outlet of its kind in Kerala. Opening the showroom, Paul de Vojis, managing director, Volvo Auto India, said the company was on an expansion mode. The dealer network will go up from seven to 15 by next year.
Kerala witnessed promising sales activity, with 30 cars being sold during the last few months, he said. This is an emerging market. While the total automobile market was growing by 6 per cent in India, the Volvo company was registering 16 per cent growth in the country.
With a strong foundation, the company was poised to reach greater heights. We have a long-term perspective, he said.
More of the Volvo cars will roll down the streets of Kochi, said Thomas K. Cherukara, executive director of MGF Auto.
He said the showroom is spread over an area of 300 square metres. The showroom and the service facility bring to life the Volvo brand values to the Indian customer, he said. The opening of the showroom was marked by a glittering ceremony where a few of the buyers were present. The sale of Volvo cars in Kerala was started by the dealer from March 2009. The current models on sale are XC-90 and S-80. The service centre at Willingdon island has round-the-clock service facility. Besides Kochi, Volvo has its presence in Delhi, Mumbai, Pune, Chennai, Hyderabad and Chandigarh. http://www.hindu.com/2009/10/01/stories/2009100150930200.htm
SUPER-SEDAN PANAMERA COMES TO INDIA Malabika Sarkar The Financial Express (Motobahn) (Oct 03)
With growth prospects drying up in their traditional domain, luxury car makers are looking at India with keen interest, as is evident from the slew of launches in the segment in recent months. Now comes another luxury four-door super-sedan, the Panamera, from Porsche. The car will debut in the country in a few days. Porsche hopes that the Panamera will consolidate its presence in India.
First unveiled at the 13th Shanghai International Automobile Show in China this year, the Porsche Panamera is expected to be priced at around Rs 2 crore in India, due to its high import duties. The company is looking to sell 50 units in 2009 and has already received 13 bookings for the super-sedan. This is the first four-door sports car from Porsche and one of the most eagerly anticipated ones in automobile history. Our dealers have already evinced considerable interest in the car and have received a number of orders even before the launch. This in itself is an evidence that the new Panamera meets the expectations of the discerning Indian luxury car buyer, says Rod Wallace, managing director, Precision Cars India, the official Porsche importer.
The Panamera, which is also known as the Gran Turismo, has received good responses from customers and the press worldwide. It will be available in all countries where Porsche models are sold. In India, the car would be imported from Germany. People have appreciated the overall package. In India, the vehicle will be really expensive. But it is meant for a small niche group of people, says Abdul Majeed, leader, automotive practice, PricewaterhouseCoopers.
The car opens up a completely new segment in the luxury automobile market. This is a car with the driving dynamics of a sports car and the luxury of a sedan. But the big challenge for Porsche will be distribution. Another challenge would be aftermarket services. The company has to really work hard in this regard, says Majeed. The sedan will be available in three models, the rear-wheel-drive Porsche Panamera S, the four-wheel-drive 4S, and the Turbo. The Porsche Panamera S develops 400hp@6500 rpm. The sedan can go from 0-60 mph in 5.2 seconds, with a top speed of 175 mph. The Porsche Panamera 4S develops 400hp@6500 rpm and can go from 0-60 mph in 4.8 seconds, with a top speed of 175 mph. The Turbo model develops 500hp@6000 rpm; and can go from 0-60 mph in just 4 seconds, delivering a maximum speed of 188 mph. The Panamera offers customer various options to customise the interiors. The car also marks the world debut of many key technologies in a production car in the luxury performance range. Some of these include the first automatic start/stop in conjunction with automatic transmission, air suspension with additional air volume on demand, active aerodynamics with a multi-stage, adjustable rear spoiler moving up when required on the Panamera Turbo. Porsche has only two dealerships in the country at present, one each in Mumbai and Delhi. The company plans to increase the number to 11 over the next two-three years. The other cities under consideration include Bangalore, Ahmedabad and Ludhiana. The company is appointing dealers in Hyderabad, Kochi and Chennai and is hopeful of having Porsche centres in six cities in India by 2010.
Porsche has received excellent customer response to both the sports cars and the Cayenne model range. The Cayenne is Porsches best selling model in India with a majority share of the overall luxury petrol SUV market. The company hopes to sell 225 units (including the Panamera) over the next 12 months. http://www.financialexpress.com/news/supersedan-panamera-comes-to-india/524302/2
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| COMMERCIAL VEHICLES Go To Top Roudra Bhattacharya The Hindu Business Line (Web & Print Edition) (Oct 02)
Alwar (Rajasthan): Ashok Leyland said that it would complete the supply of 875 Ultra Low Entry (ULE) buses to the Delhi Transport Corporation (DTC) from its new bus body facility at Alwar in Rajasthan by February 2010.
According to Ashok Leyland, the 35-seater ULE buses have an extremely low floor height of 390 mm, besides air suspension, wide doors and windows for passenger comfort. The 250 hp automatic buses are also fitted with a speed limiting system and electronic doors, it said.
According to Mr Rajeev Saharia, Executive Director (Marketing), the Alwar facility will supply the first 50 buses to the DTC this month. We have already given both the A/C and non-A/C prototypes to the DTC, he said.
Explaining the delay in delivery he said, There were a lot of changes in specifications that had to be made after the order was placed, both from the DTCs side and ours. Mr Saharia also said that the Rs 1,190-crore deal between the two parties includes a contract for the maintenance of the buses for 12 years.
On the order for 4,800 buses under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) contract, Mr Saharia said that around 350 buses have been delivered to the various States. Ashok Leyland, along with Tata Motors, had got a lions share out of the approximately 11,000 bus contract under the JNNURM.
This is the first time we are supplying full body buses, along with the chassis. The complete delivery of 4,800 buses will be completed within the current fiscal, he said. He added that the Alwar facility can currently produce 200 units a month, which is being ramped up to 300 units.
The buses, according to Mr Saharia, are priced around Rs 55-70 lakh, depending on the individual specifications.
Mr Saharia said the company is looking to hike prices from April once the new emission regulations come into force. From April, 11 Indian cities are to move to Bharat Stage (BS) IV norms from BS III, while the rest of the country will switch over to BS III norms, up from BS II.
Rising costs Costs will have to be passed on to the consumer. It will vary according to the model, but we are looking to increase prices on all models, he said. He added that the rise will primarily be because of the higher development costs of more efficient diesel engines. Company officials added that Ashok Leyland is making a loss of around Rs 4 lakh a bus it manufactures under the DTC and JNNURM orders, primarily because of rising input costs, like steel, and tight specifications of orders. Moreover, the testing cost for each bus is high, at around Rs 2 lakh, they added.
Speaking on the rising input costs, Mr Saharia said, We are committed to a price in the DTC and JNNURM contracts and so will have to absorb any rise in input costs. On sales targets, Mr Saharia said that the company expects a growth in sales by around 5 per cent for the fiscal. With a good performance in the first half, we are improving on our targets. Our production during the first half stood at 80,000 units. This should go up to 1.10 lakh units in the next half with a growing demand of tractors and multi-axle trucks. The demand for tippers is also growing with the boom in the construction sector, he said.
Company officials said the company had exported around 9,000 units out of the total production of 53,000 units last year, which was lower than normal because of the global slowdown and subsequent fall in demand.
According to Mr Saharia, the company plans to continue on its product development and investments as it emerges out of tough times. The new plant in Uttarakhand, with a capacity of 50,000 units, would be inaugurated in a few months, he said. http://www.thehindubusinessline.com/2009/10/02/stories/2009100252370200.htm Leyland to roll out hi-tech buses from Alwar plant The Hindu (Web & Print Edition) http://www.hindu.com/2009/10/03/stories/2009100357541400.htm
Garima Singh Neogy The Telegraph (Web Edition) (Oct 03)
Alwar (Rajasthan): Commercial vehicle major Ashok Leyland will make 5,000 buses this fiscal at its Alwar and Pantnagar facilities. The vehicles will be delivered to different state transport bodies.
The company, along with Tata Motors, had bagged a major share of the Rs 5,000-crore contract under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) scheme.
A unit for building buses has been set up at our Alwar plant at an investment of around Rs 65 crore. Apart from catering to the Delhi Transport Corporation (DTC), we will manufacture 200 low-entry buses for state transport undertakings of Rajasthan, Maharashtra and Andhra Pradesh under the JNNURM scheme, said Rajive Saharia, executive director (marketing) of Ashok Leyland.
Ashok Leyland has so far delivered around 350 buses under the JNNURM plan. The Pantnagar plant will go on stream in a few months. The capacity of the Alwar facility will be ramped up from 200 low-entry buses a day to 300.
Price hike Ashok Leyland is planning to increase the prices of its commercial vehicles by April 2010 to offset the rise in input costs.
Steel prices are moving up. We are also facing higher costs because of technology upgradation associated with new emission requirements. The cost has to be passed on to consumers, said Saharia.
Fixed price deals with local transport bodies for delivery of vehicles is another reason for the price hike. On the quantum of the price increase, Saharia said, It will vary, depending on the vehicles and models. However, it is likely to be across all models. Saharia said the price hike would happen only after this fiscal when new emission norms come into play.
All vehicles in 11 major cities will need to comply with Bharat Stage-IV emission norms, while other cities will move from Bharat Stage-II to Bharat Stage-III. Ashok Leyland will soon deliver 50 buses to DTC as part of its Rs 1,190-crore contract to supply 875 units this fiscal.
Apart from a Rs 480-crore contract for the supply of new buses, the two parties had signed a Rs 710-crore deal for the maintenance of the vehicles over a period of 12 years. Major commercial vehicle makers will deliver 2,200 buses to DTC this fiscal, of which Ashok Leylands share is 875 buses.
It will sell both air-conditioned and non-air conditioned buses in the price range of Rs 49.9 lakh to Rs 59.3 lakh. http://www.telegraphindia.com/1091003/jsp/business/story_11569021.jsp Ashok Leyland to hike output at Alwar plant The Financial Express (Web & Print Edition) http://www.financialexpress.com/news/Ashok-Leyland-to-hike-output-at-Alwar-plant/523920/
ASHOK LEYLAND'S PANTNAGAR PLANT TO GO ONSTREAM SOON PTI See this story in: Business Standard (Web & Print Edition) (Oct 03)
Alwar (rajasthan): Hinduja Groups flagship company Ashok Leylands Rs 1,300-crore Pantnagar (Uttarakhand) plant is likely go onstream within the next few months. The plant would have an installed capacity of 50,000 units of commercial vehicles annually. Besides, the company is also planning to increase the capacity at its Alwar plant by 50 per cent this year.
Work on the Pantnagar plant is progressing well and we hope to inaugurate it within a few months. The plant would have an annual installed capacity of 50,000 units, Ashok Leyland Executive Director (Marketing) Rajiv Saharia told reporters here.
He, however, did not specify a time-frame for the inauguration of the plant. The company has six plants across the country with an annual installed capacity of 100,000 units.
Ashok Leyland has a contract with various state and local transport bodies under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) to supply 5,000 buses during this fiscal.
The Pantnagar plant would further boost our capacity at a time when the market is showing signs of revival, Saharia said.
He added that the company is also looking to increase the capacity of its Alwar plant by 50 per cent to 300 ultra low entry (ULE) buses a month, from 200 units at present. The capacity expansion at the Alwar plant would be carried out within this fiscal, Saharia said. Ashok Leyland has a contract with the Delhi Transport Corporation (DTC) for the delivery of 875 ULE buses this fiscal.
The Alwar plant of Ashok Leyland also manufactures bus chassis. Around 110 units of chassis are made everyday there. Ashok Leyland Pantnagar plant to go on stream within months The Hindu Business Line (Web & Print Edition) http://www.thehindubusinessline.com/blnus/02021305.htm
TO ROLL OUT LOW-FLOOR BUSES FASTER, ASHOK LEYLAND SETS UP NEW PLANT The Indian Express, (Express Newsline)
According Leyland officials, the DTC had ordered changes in design of bus prototypes after a new low-floor bus caught fire in Delhi last year.
Indicating there were problems and delays in negotiations, Rajiv Saharia, Executive Director (Marketing) Ashok Leyland, said, We were supposed to supply the buses earlier. But there were several changes DTC wanted. And yes, there were issues from both sides.
Now, the latest low-floor buses are different: the non-AC green-coloured buses are fitted with larger windows, which can slide open. This change was made after commuters complained of asphyxiation. The floors of both AC and non-AC buses have tiny silicon chips inserted in them for an anti-skid effect.
The company also promises that the air-conditioner will keep the temperature inside the bus at a cool 25 degrees and in winters there will heating with in the buses.
Another feature, which is bound to go down well with the passengers, is stop buttons that will work as an alarm for the driver to stop the bus.
In view of the upcoming Commonwealth Games, the buses will also boast of international features laptop and mobile phone charging points and space for hand baggage.
The buses can also tilt towards passengers as they embark. Leyland is set to roll out 875 low-floor buses (of which 350 will be AC buses) for Delhi of these around 50 are ready for inspection.
The first 50 non-AC buses should roll out by October. All the buses will be ready before March 2010, Saharia said. For this, the company is ramping up production: from a current outlay of 200 buses per month, the target now is to touch 300 buses per month.
Officials claim that the delays could also be a result of the fact that the buses are low-floor.
To aid the elderly and wheelchair-bound, the Delhi government had decided that some of the new buses for the Games would be low-floored, a new concept for Delhi. With this the Corporation also said that the bus manufacturer should create the entire bus earlier DTC fitted bus frames on the readymade bus chassis. The low-floor concept creates a difference of around Rs 30 lakh and the execution of the concept has taken longer, Leyland officials said. But will the buses be ready on time for Game? Next year will bring the answer.
DTC BUSES TO HAVE CLIMATE CONTROL, CHARGERS
The Times of India (Web & Print Edition)
New Delhi\Alwar: On Sunday, about 70 more new low-floor buses will be inducted into the Delhi Transport Corporation (DTC) fleet. And after this, the corporation will get nearly 200 buses every month till March next year by when about 3,100 new buses would be added to Delhi roads. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved" 2nd fleet of low-floor CNG buses set to vroom on city roads The Pioneer (Delhi Print Edition) Desing hitch keeps new low-floor buses off city roads Hindustan Times (Delhi Print Edition)
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| CONSTRUCTION & AGRI MACHINERY Go To Top Bloomberg See this story in: The Hindu Business Line (Oct 03)
Komatsu Ltd., the worlds second-biggest marker of construction machinery, plans to increase its sales of hybrid excavators next fiscal year to 3,000 units, the chief executive officer said. Sales are expected to rise from about 500-700 units forecast for the fiscal year ending March 31, Mr Kunio Noji told reporters at the companys Shonan factory near Tokyo. Komatsu is targeting increased sales of hybrid excavators in China, which surpassed Japan as its biggest market for construction and mining machinery in the first quarter. Demand was spurred by the nations 4 trilliom yuan ($586 billion) economic stimulus package, as the companys sales from the US, Europe and Japan tumbled. Monthly production of hybrid excavators would increase to 300 starting next March, compared with about 100 planned for this month, Noji said. Total excavator unit sales in September increased more than 70 per cent compared with the same month a year earlier, he said
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| 2/3 WHEELERS Go To Top The Hindu Business Line (Oct 02)
Mumbai: Hero Honda continued its good run in September with sales of 4,01,290 two-wheelers, of which motorcycles led by the Splendor and Passion brands accounted for a lions share.
The companys gearless scooter, Pleasure, makes up less than five per cent of total sales. This was higher than the 3,85,262 units sold in September last year though a tad lower than the preceding months level of 4.15 lakh units. Sources said Hero Hondas numbers had been impacted by the labour strife at some of its suppliers plants in the Gurgaon belt.
Hondas other arm in the country, HMSI (Honda Motorcycle & Scooter India), had not released its figures till late Thursday evening but is expected to do an encore of Augusts level of 85,000 units. The company had actually been cruising at over one lakh two-wheelers in the preceding months but, like Hero Honda, has been hit by problems at its suppliers end. TVS Motor Company posted sales of 142,553 bikes and scooters in the month which was slightly higher than 137,246 units in September 2008.
Of these, exports accounted for 10,272 two-wheelers and industry sources say this component could increase in the coming months.
Suzuki Motorcycles September sales totalled 15,719 units (2,514 last year) while Japanese counterpart, Yamaha did 26,394 motorcycles (10,142). Bajaj Auto will report its figures on Friday though it has already stated that it is targeting 2.5 lakh bikes on an average in September and October.
Indications are that overall two-wheeler sales would be a little over 900,000 units in September though experts believe that the one-million unit mark would have been breached had it not been for the labour issues with Gurgaon-based suppliers. http://www.thehindubusinessline.com/2009/10/02/stories/2009100252420200.htm
Shobhana Subramanian Business Standard (The Compass) (Oct 03)
Mumbai: After a strong run in the first half of the year, the Hero Honda stocks performance over the last three months has been similar to that of the market, both gaining around 17 per cent. Over the last month or so, however, the stock has done slightly better than the market. One reason for this is that while there were apprehensions earlier, that a less-than-normal monsoon could hurt sales, these have receded with better rainfall in September.
Also, with the share of farm income in total rural income now less than 50 per cent, the impact this time around, of a sub-normal monsoon is expected to be less severe than in the past. Hero Honda earns around 50 per cent of its revenues from rural markets. The despatches for September, at just over 4.01 lakh vehicles, are a shade lower than the 4.15 lakh in August. Despatches for both months would have catered for pipeline stocks in August these were estimated around 60,000-70,000 and could be higher for September.
Nevertheless, retail sales both in August and September should have overtaken the 3.4 lakh figure achieved in July. The management believes that the current festive season will see the companys sales surpassing the six lakh units sold during the festive season last year. That should not be difficult given that the economic environment is now far more benign than it was at this time last year; salaries are being restored across several sectors, two-wheeler loans are easier to access in a softer interest rate regime and the release of the balance arrears to government employees, following the Sixth Pay Commissions recommendation, will put more money into the hands of consumers.
So a pick-up in urban consumption should more than offset any fall in rural demand. As such, with a number of new launches and upgrades lined up over the next six months, Hero Hondas volumes in the current year should increase by about 10 per cent. On a smaller base, they were up 12 per cent in 2008-09. The only concern now is the winter monsoon; its possible that sales could slow somewhat down if the winter rains arent sufficient though the wedding season would partly compensate for that.
Also, Bajaj Auto has made a comeback in the 100cc segment selling one lakh bikes in less than two months. This space has been dominated by Hero Honda, but Bajaj could take away some market share. Nevertheless, Hero Hondas revenues are estimated to rise about 17-18 per cent this year over the Rs 12,319 crore in 2008-09. With operating margins expected at 16.5 per cent, earnings should grow by about 42 per cent. At the current price of Rs 1,634, the stock trades at 18 times estimated 2009-10 earnings. http://www.business-standard.com/india/news/hero-hondafestive-start/372024/
BAJAJ AUTO SALES RISE 14% IN SEPTEMBER Business Standard (Oct 03)
Mumbai: Bajaj Autos newly launched 100cc motorcycle Discover DTS-Si has turned around the sales curve of the company, with the Pune-based two-wheeler firm logging its highest monthly sales in over 22 months.
The company, which is also Indias second biggest two-wheeler maker, stated that sales of both motorcycle and automatic scooters rose by 14 per cent to 249,795 units in September, up from 217,365 units recorded during the same month last year. Bajaj Auto had last crossed the 250,000-unit mark in October 2007.
The figure for September includes export numbers, too, as the company does not provide separate numbers for domestic and export segments.
Bajaj Auto decided to make a renewed splash in the 100cc segment with the launch of the Discover DTS-Si, after sales from its executive and premium segment (125cc and above) came under intense competition due to a rise in demand for the models of Hero Honda, Yamaha and TVS Motors. Bajaj Auto General Manager Milind Bade said: We had decent bookings even during the inauspicious Shradh period, with customers ready to take delivery of the vehicle after a few days. The industry will hold onto its buoyancy even in the second half of this year, especially because the base of last year was very low.
According to him, there is a waiting period of two weeks and above on Bajaj bikes and three-four weeks on the 180 and 220 Pulsars, mainly in metros like Mumbai. The momentum of growth will be maintained in the coming months as the well, he further added.
Bajaj had, in October 2006, announced a tactical exit from the 100cc (entry level) segment, stating that no product development initiatives will take place in this segment. The company also sells the Platina 100 in this segment, which accounts for almost 75 per cent of the total motorcycle market in India.
Bajaj sold 94,000 Discovers, including 71,000 units of the newly-launched Discover DTS-Si. The month also witnessed the sale of 56,000 Pulsars. Thus, 60 per cent of Bajaj motorcycles sold in this month belong to the more profitable category of the bigger and sportier Pulsar and Discover brands, the company stated in a press release.
Sales of three-wheelers also showed an upward climb with a 16 per cent increase. The company sold 31,121 units of three-wheelers during the same month as against 26,887 units sold in the corresponding month a year ago.
Bajaj is also gearing up to launch the Kawasaki Ninja 250 R, a high-performance premium bike from Kawasaki Heavy Industries, Japans fourth-largest bike maker and technical partner of Bajaj Auto.
Pricing details of the bike, which would be launched on Wednesday, are yet to be revealed by the company but experts say that since the bike will be assembled at the Chakan facility of Bajaj Auto, the company will have a pricing advantage. http://www.business-standard.com/india/news/bajaj-auto-sales-rise-14-in-september/372064/ Bajaj Auto sales grow by 14 pc in September The Economic Times Bajaj Auto sales grow by 14% in September The Financial Express http://www.financialexpress.com/news/bajaj-auto-sales-grow-by-14-in-september/524280/ Bajaj Auto sales grow by 14% in September Yahoo India http://in.biz.yahoo.com/091002/50/baua17.html Bajaj posts 14.62% rise in bike sales Deccan Herald http://www.deccanherald.com/content/28347/bajaj-posts-1462-rise-bike.html Bajaj Auto sales grow by 14% in September The Indian Express Bajaj 2-wheeler sales up 15% in Sept The Hindu Business Line http://www.thehindubusinessline.com/2009/10/03/stories/2009100350270200.htm
BAJAJ AUTO TO PHASE OUT CNG ONE TONNER 3 WHEELER IN GUJARAT Business Standard (Oct 02)
Mumbai/ Ahmedabad: With the launch of its latest commercial three wheeler, RE600, in Gujarat, Bajaj Auto is now planning to phase out one tonner CNG three wheeler from the state. While Bajaj Auto has launched the diesel version of RE600, it plans to introduce CNG version of the vehicle in couple of months.
Talking about the company's plans, RC Maheshwari, CEO, Commercial Vehicles, Bajaj Auto Ltd. said, "We did a research and found that although we were offering a one tonner, people were mostly loading till 600 kg. So we planned to come up with a 600 kg capacity vehicle under RE600. Gujarat provides around 19 per cent to our three wheeler commercial vehicles business and we plan to launch CNG version of RE600 here in couple of months. Gradually, we plan to phase out the CNG one tonner three wheeler commercial vehicle from the state."
In the first month of the launch, Baja Auto expects to sell around 100 units of RE600 and later increase it to 400-500 units per month.
Priced at around Rs 1,10,000, RE600 offers best in class mileage of 36 km per liter of diesel in actual operating conditions, which is 15 to 20 per cent more than other vehicles. The RE 600 is specially conceived and developed for cargo movement in congested cities & towns.
According to Maheshwari, RE600 has the lowest turning radius for high maneuverability even on narrow roads, has twin front suspension and a spacious cabin for comfortable long hours of drive, has high torque for quick pick-up even with heavy loads and has ease of frequent and quick start-stop cycles, making it the best suited vehicle for in-city operations. The RE 600 has thus created a new category in the small commercial vehicle segment.
Bajaj Auto sells around 25,000 units of three wheelers per month, of which around 15,000-16,000 units are sold in the domestic market. The company expects to sell around 2,500 units of RE600 alone per annum in next one year, he said.
Meanwhile, Maheshwari added that Bajaj Auto is ramping up its three wheeler manufacturing capacity from 30,000 per month to 35,000 per month through an investment of less than Rs 100 crore. Three-wheeler cargo vehicles to see growth again Bajaj Auto to expand facility The Hindu Business Line http://www.thehindubusinessline.com/2009/10/02/stories/2009100251370300.htm
INDIA YAMAHA MOTOR SALES RISE OVER TWO-FOLD IN SEPTEMBER PTI See this story in: The Economic Times (Oct 02)
New Delhi: Two-wheeler maker India Yamaha Motor on Thursday said its sales have jumped by more than two-fold to 26,394 units in September.
It had sold 10,142 units in the same month last year. "There has been very good customer response to Fazer, our new model which got introduced in July 2009. Our new introduction of R15 new colours has also been very well accepted," India Yamaha Motor Managing Director and CEO Yukimine Tsuji said in a statement.
He said the company is hopeful of getting good response to its Rs 20 lakh super-bike VMAX, which was launched in mid-September. The 1,679 cc VMAX is the third superbike from the company in the Indian market.
Products like the FZ16 and the FZS have also contributed to the growth, the company added.
WE AIM TO BUILD END-TO-END GLOBAL TWO-WHEELER BUSINESS: ANOOP MATHUR, PRESIDENT, TWO-WHEELER SECTOR, M&M Malabika Sarkar The Financial Express (Motobahn) (Oct 03)
Mahindra & Mahindra (M&M) has recently forayed into the two-wheeler market. Anoop Mathur, president, two-wheeler sector, M&M, is optimistic about this new business venture. He talks about the companys plans with FEs Malabika Sarkar:
When do you plan to enter the motorcycle segment?
Mahindra Two Wheelers will be present across all segments of the two-wheeler industry over the next three years. We have recently extended our scooter portfolio with the launch of Mahindra Rodeo and Mahindra Duro. We plan to enter the motorcycle segment by FY 2011.
The core emphasis of the two-wheeler portfolio of MTW will be automatic scootersa segment that Kinetic helped create and later dominated before the Japanese competition walked in and took over. What are your plans to reclaim that market?
The Mahindra Groups venture into the two-wheeler segment began with the acquisition of the business assets of Kinetic Motor Company (KMCL). Our intent has been to be a credible player in the Indian two-wheeler industry. We would aim to build a robust end-to-end global two-wheeler business with presence in all product segments. We will design and market a range of scooters, value-engineered motorcycles and high-end motorcycles for Indian as well as global markets. MTW will offer differentiated products with more value-enhancing features to the consumers. We will offer products with good technology, superior design and styling, and strong after-sales service. We believe in and are committed to innovation, customer centricity and delivering trust, reliability and excellent value for money to its customers.
Where do two-wheelers fit in in Mahindra groups strategic growth plans?
Mahindras foray into the two-wheeler sector leverages M&Ms 62 years of automotive manufacturing experience. For Mahindra, two-wheelers are an additional touch-point for consumers to interact and bond with the ever-expanding universe of Mahindra products & services. Within the automotive space, it allows M&M to engage and build relationships with customers at a relatively early stage of the personal transport solutions value chain. This will give an opportunity to place Mahindra in every household, given M&Ms dominant presence in the rural and semi-urban segments and Mahindra Finances extensive reach in these markets.
MTW has tremendous back-end synergies, thanks to its long-standing supplier base, and at the front-end because of the dealer network of CVs and passenger cars. What kind of advantage does this offer to MTW?
MTW is working in a structured way to leverage the synergies within the M&M group. We are working closely with Mahindra Finance to provide retail financing to our consumers. We are also working with the Mahindra Systech sector to gain efficiencies in our inbound supply chain and sourcing. Engines engineering is already involved with all the R&D activities at MTW. We are working with the auto sector and the farm equipment sector to enhance our dealer network. We are also in talks with Bristlecone technologies for supply-chain solutions. Overall, the synergies with the M&M group will help us achieve a competitive advantage while making us a credible player in the industry.
M&M has a wide range of vehicles, including MUVs, LCVs, passenger vehicles and three-wheelers. Why and when did you plan to foray into the two-wheeler segment?
We formally took over the business assets of the KMCL on November 18, 2008. The two-wheeler industry is the current bright spot in the automobile sector. After the slowdown in 2008, the two-wheeler industry bounced back from February 2009 onwards. M&M is bullish about the growth rates of the two-wheeler industry. Our market study before entering this segment had shown that the fundamental demand drivers of this category will remain robust and hence the segment will continue to grow at a double-digit rate. The primary contributors to this growth story have been improvement in quality and technology, easy availability of finance and an increased need for personal transportation. India has a predominantly young population. This, coupled with low penetration levels, provides a significant head room for growth.
The company is looking at exporting two-wheelers. Can you share your plans in this respect?
Being a new entrant, our initial focus will be to tap the potential of the vast domestic market. We are in the process of developing our exports strategy for the long term. We are studying various international markets to prepare a roadmap.
You are also planning to source components from China. What would be the percentage? China is a low-cost option for sourcing of components and we will leverage the cost competitiveness of China wherever possible.
Mahindra is already planning to set up a two-wheeler plant in tax-free states like Uttarkhand and Himachal Pradesh. By when can we expect these plants to be operational?
This is speculative and we would not like to comment. Our current two-wheeler facility is in Pithampur, Madhya Pradesh. The current capacity will suffice us for the next few years.
Currently you have a capacity of 5 lakh units at Pithampur, which you got with the acquisition of Kinetic. Any plans for capacity expansion?
We are studying various options for expanding our capacity which includes expansion at our existing plant in Pithampur. http://www.financialexpress.com/news/we-aim-to-build-endtoend-global-twowheeler-business/524299/3
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| COMPONENTS Go To Top The Hindu Business Line (Oct 02)
Mumbai: Labour unrest at auto ancillary plants in Haryanas Gurgaon-Manesar belt is threatening to snowball into a crisis where supplies to big names such as Hero Honda, Honda Motorcycle & Scooter India and Maruti Suzuki could be hit in the coming months.
Apparently, vendors such as Rico Auto, Sunbeam Auto, Microtech, Endurance and Hema Engineering, with facilities in the region have been feeling the heat over the past few months.
Production has been impacted but nobody is talking about it because this is a sensitive issue where there is no point adding fuel to the fire, industry sources said.
Attention was also diverted from this part of the country when news of a Pricol executives murder in Coimbatore hit the headlines recently. Gurgaon and Manesar have been simmering for sometime now except that there have been no cases of physical assault yet, they added.
Wage issues While higher wages are the core of the problem in most cases, there is the growing fear that the problem is being aggravated by a handful of troublemakers with support from external elements. Most companies have reiterated that, by and large, there are no problems with their workers who are, otherwise, keen to get back to the shop-floor but continue to be intimidated by those with strong connections outside.
The Haryana administration would also like to keep an arms length because of the Assembly elections which means that nothing is going to happen till the results are out, sources said. Until then, companies are hoping that the situation does not spill out of control, though indications are that the issue is spreading to other plants which could then paralyse work in the Gurgaon-Manesar area.
Reports have been doing the rounds that Maruti Suzuki and Hero Honda could have shown even better results in September, had it not been for the labour strife at their suppliers plants which affected delivery schedules of parts.
This was also true for HMSI which had, otherwise, been posting monthly sales of one lakh two-wheelers but had slipped in August and September to levels of 85,000 units. There is precious little manufacturers can do at this point except bear it. Equally, it is not as if the Haryana region is the exception to the rule either.
Tamil Nadu has had its own share of labour issues at the facilities of Hyundai, MRF and Pricol. Earlier, there were some problems at the Mahindra & Mahindra plant at Nashik. The issues, of course, are never similar for the companies concerned but the fallout is painful in terms of lockouts and erratic supplies.
Inflation woes Experts say that inflation is beginning to pinch household budgets and this is what is prompting workers to agitate. In their turn, managements argue that they have been just and fair especially in these troubled times when global business is also drying up. State governments must eventually intervene to prevent issues from going out of control and ensure that investments are not hit, they add. http://www.thehindubusinessline.com/2009/10/02/stories/2009100252410200.htm
NEW LAUNCHES, AND NEWER CUSTOMERS Yogima Seth, Shweta Bhanot (Oct 03)
The domestic automotive mart is just about emerging from the after-effects of a downturn-induced slump in volumes. Put it down to festive revelry, an improving lending regime or the slew of new launches, consumer footfall at dealerships is on the rise. And the conversion rate is heartening. Experts suggest that one in every four to five visitors are walking away with the machine of their choice. Original equipment manufacturers (OEMs) have cracked open several sub-segments as is evident from the recent wave of new products. In effect this has unlocked potential for various products that would have looked sort of out of place in the Indian automotive landscape, until only a couple of years ago.
One such segment, which radically altered the sports utility vehicle (SUV) ballgame, is that of the soft-roaders. Head to the mining outbacks of Jharkhand or Bellary and youll find white Tata Safaris or Honda C-RVs, complete with their VIP licence plates, at motion sickness inducing speeds. So manufactures thought, why not give them more 4X4 toys to play with? Then again, the dilemma is that the upwardly mobile dont want to be seen as a motley bunch with a monstrous carbon footprint. Enter soft-roaders like Mitsubishi Outlander, Nissan X-trail, Land Rover Freelander2 and Audi Q5.
So what is a soft-roader? No rocket science here. Old-school SUVs are built on a ladder-frame, making them bulky fuel guzzlers that require special skills or an expert driver to take you from point A to point B. Soft roaders are a carved out of a singular monocoque, often a crossed over extension of a sedan platform. Effectively from the basic options of Safari, Endeavour and Scorpio, the market recently witnessed new entrants across the value chain. Not that the old-school ladder-frame format is outdated, Toyota unveiled its flagship Land Cruiser 09 and more recently the Fortuner at Rs 18.45 lakh, ex-showroom New Delhi. Ford too, upped its Endeavour ante with a redesigned variant available with an auto-tranny along with Audi that free lidded its mighty new Q7.
Another segment thats beginning to evolve and has great growth potential is the premium hatchback segment. This is a revolution safely credited to the Maruti Suzuki Swift. Much has already been written about the great Indian hatchback affair. So, OEMs went back to their global design studios to check if they could fit their international super-minis into the desi jigsaw puzzle. Within a year, the Skoda Fabia, Fiat Grande Punto, Hyundai i20 and Honda Jazz are all out there to eat into each others market share. And soon to follow is Volkswagen Polo by early next year. So, while marketing managers or OEMs are sweating it out, the customers are asking for the competition. http://www.financialexpress.com/news/new-launches-and-newer-customers/524300/2
The Financial Express (Oct 02)
Auto component maker Bharat Forge said it will raise $150 million (nearly Rs 720 crore) through various fund raising routes. The company is seeking shareholders nod to raise $150 million by of issuing bonds, debentures or though global depository receipts (GDRs), Bharat Forge said.
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| ALLIED INDUSTRY Go To Top | |
| FINANCE & INSURANCE Go To Top L.N. Revathy The Hindu Business Line (Oct 02)
Coimbatore: Bank of Baroda has effected a downward revision on car loan rates with immediate effect. The offer, however, is valid only for one month up to October 31. We will review the situation on November 1, Mr Nandan Shrivastava, General Manager (Retail Banking, Official Language and Marketing), BoB, Mumbai, said.
Mr Shrivastava was in the city to inaugurate the banks 28th Retail Loan Factory here. Speaking on the sidelines of the function, he said, we had hitherto pegged the rate of interest on the quantum of the loan availed. For loans up to 15 lakh, the rate was fixed at 10.5 per cent and at a different rate for loans between Rs 15 lakh and up to Rs 1 crore.
Now, the rate is fixed based on the loan tenure, irrespective of the loan amount. For a three-year loan, the rate has been pegged at 9.75 per cent from 10.5 per cent and for period up to five years, it has been revised to 10.25 per cent.
Asked if the bank would extend it to used cars as well, he said, while we are not averse, we are not aggressive on financing for used cars.
Retail Loan Factory The retail loan factory (RLF) works on assembly line concept, with the sales team generating leads and the process team according sanctions within a turn around period of 6 working days. We want to ensure fast credit without compromising on asset quality. Any loan be it home loan, trade finance, advances against property and car loan backed by collateral - would fall within the ambit of the RLF sanctions, he said.
The RLFs have sanctioned 57,000 loans up to end June and the amount sanctioned totalled Rs 7,350 crore. We would have sanctioned another Rs 500 crore in the last three months, Mr Shrivastava said. The RLF at Coimbatore would serve the banks customers in Tirupur and Coimbatore districts. BoB has 19 branches in this region. The Coimbatore RLF would aim at a target of Rs 25 crore this half year, he said.
On finance support for two-wheelers, he said personal and two-wheeler loans are based on relationship. It happens at the branch level, he said without divulging the total sanctions and stating that such loans did not fall within the purview of RLF.
Gold Coin sales According to Mr Shrivastava, the bank considers sale of gold coins a profitable business. We started selling 24 karat coins with Assay certification in the 2, 4, 5 and 8 grams denomination and 10 gram bar from October 2007. It has been a profitable proposition. We offer our customers a discount and to those making bulk purchases. http://www.thehindubusinessline.com/2009/10/02/stories/2009100250900600.htm
SALES OVERDRIVE SENDS AUTO FINANCING TO TWO-YEAR HIGH Chanchal Pal Chauhan The Economic Times (Oct 02)
New Delhi: With auto sales zooming, auto financiers, too, are back with a bang. Top eight auto financiers disbursed loans worth Rs 3,400 crore in September highest for a month in the past two years led by impressive auto sales, new launches and return of confidence among potential car buyers.
The disbursement in September is 25% higher than the monthly average of Rs 2,700 crore seen in the past four months. Auto finance leader HDFC Bank has registered a growth of over 40% in loan disbursement in September from a year ago, while other leading players such as Kotak Mahindra Bank, SBI, Canara Bank, PNB and Bank of Baroda have also seen a growth in the range of 25-35%. This September is expected to mark a historic high in sales for the car industry.
We had a terrific month after a long gap, as sales went much beyond our anticipated targets. We disbursed loans of over Rs 1,000 crore in September. The growth momentum is expected to spill over to October, HDFC Bank auto loan head Ashok Khanna said.
Other bankers are equally upbeat. Kotak Mahindra Bank CEO Sumit Bali said, It seems the market is on fire. Sales have virtually zoomed to the highest level in the past few days with almost zero inventories at many car dealerships. Our loan disbursal for the month has increased 50% to Rs 325 crore.
Consumer sentiment had turned weak and auto financiers became conservative on lending last September, following the collapse of US investment bank Lehman Brothers in the US. This coupled with early arrival of festive season, which is governed by Hindi calendar, has led to a massive year-on-year growth for auto loans.
A low-interest rate regime has also helped financier attract customers. The entry of PSU banks with aggressive single-digit rate against 10-12% offered by private banks has expanded the market, especially in smaller towns and rural areas.
The demand for new cars from our branches in tier II & III towns has been very steady. There is a major jump in our total loan allocations in September over August and much of that has come from these smaller markets, said a senior SBI executive preferring not to be named.
Carmakers are also benefiting from the easier availability of finance, registering a high double-digit growth. Customers are actually benefiting from extremely low interest rates offered by few PSU banks. We have noticed that some customers who had postponed their purchases are again flocking to our dealers to buy new cars, said Maruti chief general manager (marketing) Shashank Shrivastava said.
A spate of new launches by car companies has also brought into the market more buyers and led to higher loan disbursal. Over a dozen new cars were launched in September alone. The next few weeks will see many new launches, including Marutis new SX4 and multi-activity van-O2, General Motors Cruze sedan, Porsche Panamera, Volkswagen Beetle and Polo, Ford Figo, Hyundai Santa Fee, BMW Z4.
GENERAL INSURERS EXPECT 10% GROWTH IN PREMIUM THIS YEAR Business Standard (Oct 03)
Mumbai: With automobile sales recovering, the general insurance industry is expecting a 10 per cent growth in premium collection in the current financial year. Motor insurance, which accounts for nearly half the business underwritten by non-life insurers, has picked up in the last few months, ensuring a faster overall growth. In August 2009, non-life insurance companies registered an 11.11 per cent growth in gross premium collections to Rs 2,530.1 crore as against Rs 2,277.1 crore during the corresponding period last year. The domestic automobile sales went up by 22.4 per cent in August.
Premium collection in August also helped the general insurance sector register a 7.59 per cent growth in April-August 2009.
Insurers are staying away from the bleeding health portfolio. This will help them reduce their underwriting losses. There are signals of economic revival and the industry will grow at 9-10 per cent this financial year, said General Insurance Councils Secretary General SL Mohan.
Within general insurers, the public sector players reported higher growth during April-August with their overall premium collection rising 9.9 per cent, while private players posted a 4.41 per cent rise in the category. Compared to last year, private players have seen a decline in growth as most of them are focusing on improving their bottom lines.
Higher claims have forced insurance companies to be selective in underwriting unprofitable business. While insurers are primarily focusing on two segments, health and motor, to boost growth, businesses such as group health insurance, where premiums are low but claims are high, have been shunned by many companies. In many cases, companies have cancelled policies in the middle of the term with a mandatory 30-day notice because of the adverse claims ratio.
Recently, the Insurance Regulatory and Development Authority Chairman J Hari Narayan had said that individual life products were faring better than group products.
INSURERS LOOK TO RAISING MOTOR THIRD PARTY INSURANCE PREMIUM Remya Nair The Hindu Business Line (Oct 03)
Mumbai: The general insurance industry is clamouring for a hike in premiums on motor third party insurance to make up for the underwriting losses arising from this line of business.
Towards this end, public and private sector players have formed a committee to look into the feasibility of this move. Underwriting losses in the motor third party insurance account for more than one-third of the total underwriting losses of all the general insurers.
Motor third party insurance premium rates have been set after consultations between the insurance companies, transport unions, government, and the insurance regulator. So, if the rates have to be increased, the transport unions have to acquiesce.
According to insurance company officials, though the rates will still be regulated, a hike in premium rates will bring respite for the general insurers who are making huge underwriting losses in this segment.
The committee, which was formed recently, is examining motor insurance data. The data consists of details such as premiums, incurred losses, said an insurance company official. Any move to hike premium rates could be a long-drawn affair as the transport unions will oppose it tooth and nail, the official added.
Depending on the outcome of the talks with the unions, the insurance regulator, IRDA will be approached.
Motor third party insurance is the only segment in which the rates are still controlled and not de-tariffed. An increase in the premiums could ultimately lead to the segment being detariffed in the next few years, said the CEO of an insurance company. At present, all general insurance companies transfer the premiums collected from commercial vehicles third party insurance to the motor third party pool. General Insurance Corporation of India is the pool administrator. The corpus of the pool is estimated at Rs 6,000 crore.
However, the claims that are paid out of the motor pool depend on each insurance companys overall market share. According to an Ernst and Young report on the general insurance industry, motor third party premiums account for around 16.3 per cent of the total premiums collected by the general insurance industry in 2008-09.
Third-party insurance has been a loss making portfolio for the insurers. Low premiums, surge in claims and fraudulent claims have been the issues plaguing the industry. There is no time limit on third party claims. A claim can be made during the entire lifetime. This leads to a lot of frauds, he said. http://www.thehindubusinessline.com/2009/10/03/stories/2009100350760800.htm
Business Standard (Oct 02)
Mumbai: Stock of Bajaj Auto Finance, the non-banking finance company (NBFC) of Bajaj Financial Services, gained 20 per cent at Rs 286 a share on the Bombay Stock Exchange on speculation of a possible restructuring.
The companys two-wheeler loan portfolio may be demerged, a market source said. The Bajaj Group operates its two-wheeler business under Bajaj Auto and speculation of a possible restructuring of the two-wheeler loan portfolio in the group pushed the stock price for the NBFC.
Sanjiv Bajaj, a director on the board on Bajaj Auto Finance, said: We do not have a restructuring plan. http://www.business-standard.com/india/news/bajaj-auto-finance-jumps-20/371955/
IFCI OFFLOADS TATA MOTORS SHARES Hindustan Times
Mumbai: IFCI has offloads Rs 26.25 crore worth of Differential Voting Right shares of Tata Motors, the company said in a filing to the Bombay Stock Exchange. The stocks were later picked up by Swiss Finance Corporation, a UK-based brokerage firm specializing in foreign currency and commodity futures trading. The DVR issue has made little impact on the voting pattern, with the Tata group owning 91.7 per cent of the rights issue of ordinary shares.
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| OIL, LUBRICANTS & ALTERNATIVE FUELS Go To Top K.S. Anandan Asian Age See similar story in: Deccan Chronicle (Oct 03)
Chennai: Shell, a global major in the industrial and automotive lubricant business, is planning to set up its second manufacturing plant in India.
Shell India has a manufacturing plant at Taloja in Maharashtra with a production capacity of 80 million litres per year. "We have reached the name plate capacity at the Taloja facility. As our growth in India is in double-digit, we are considering to set up our second manufacturing plant in India in the next 12 months," said Mr Donald Anderson, country head- lubricants, Shell India Pvt Ltd.
Shell also believes that the company has reached a critical mass with about eight per cent market share in the lubricant business that is traditionally dominated by the government-owned companies. In addition, he said, "the brand is in demand," and the company has established strong relationship with its Indian customers.
Mr Anderson said the company has yet to decided whether the new plant would set up by the Shell itself or with a joint venture partner. The company will take a decision in the next 12 months on this.
The plant is likely to be set up in southern or eastern part of India near to a port city with an investment of $100 million. http://www.asianage.com/presentation/leftnavigation/news/business/shell-to-set-up-2nd-plant.aspx http://www.deccanchronicle.com/business/shell-set-2nd-plant-962
OIL FALLS BELOW $69 AFTER US EMPLOYMENT DATA Reuters See this story in: The Economic Times (Oct 02)
London: Oil fell more than 3 per cent to below $69 a barrel on Friday after worse-than-expected US employment figures raised doubts about the strength of the economic recovery in the world's largest energy consumer.
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| INTERNATIONAL NEWS Go To Top Reuters See this story in: The Economic Times (Oct 03)
Detroit: US auto sales tumbled by 23% in September as showrooms emptied after the government-funded boom from the cash for clunkers programme, with General Motors and Chrysler hardest-hit. Sales for General Motors and Chrysler the two US automakers struggling to regain momentum after emerging from bankruptcy dropped by 45% and 42%, respectively. http://economictimes.indiatimes.com/articleshow/5082282.cms US September auto sales dip 23%; GM, Chrysler hit hard Business Standard
JAPANESE AUTOMAKERS SEE HYUNDAI AS GLOBAL THREAT Agencies See this story in: The Economic Times (Oct 03)
Tokyo: Hyundai Motor Co., not the up-and-coming Chinese, nor the leaner meaner Americans, is the automaker that has the Japanese seriously worried.
Talk to any Japanese auto executive, and the official is likely to say the South Korean automaker is rapidly emerging as the most feared competitor to Japan's world-leading car companies.
GERMAN NEW-CAR MKT SWELLS (Oct 03)
Frankfurt: Germany's new car market grew by 21% in September and orders fell a less than-feared 12% even as a scrap page scheme for old autos ran out of money, the VDA vehicle manufacturers association said on Friday. Around 316,000 new cars were registered in Europe's biggest auto market last month, bringing the total in the first three quarters to nearly three million, a gain of 26%. VDA said worries were overblown that domestic demand would fall off a cliff now that a programme offering motorists 2,500 euros ($3,634) to scrap old cars and buy new ones has ended. Automakers' orders on hand stood at 471,200 units in September, up 31% from a year earlier, guaranteeing that registrations would remain high for the rest of the year. The German data follow news that U.S. auto sales tumbled last month after the government-funded "cash for clunkers" programme ended.
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| ECONOMY & FINANCE Go To Top The Hindu Business Line (Oct 03)
Mumbai: Foreign exchange reserves fell $860 million to $280 billion for the week ended September 25, according to figures released in the Reserve Bank of Indias weekly statistical supplement.
This is the second consecutive week in which the reserves have fallen. For the week ended September 18, the reserves fell $208 million to $280.77 billion. In the week under consideration, the foreign currency assets fell $855 million to $263.498 billion.
Foreign currency assets expressed in US dollar terms include the effect of appreciation or depreciation of non-US currencies.
Gold reserves remained unchanged at $9.828 billion. SDRs were down by $4 million at $5.220 billion. The reserve position in the IMF decreased by $1 million at $1.364 billion. http://www.thehindubusinessline.com/2009/10/03/stories/2009100350750800.htm
The Economic Times (Oct 02)
New Delhi: The wholesale price-based Inflation for the week ended September 19 went up sharply to 0.83% from 0.37% in the previous week on costlier food items.
Inflation in food articles for the week under consideration was at an eleven-year high of 16.32%, causing some concern in the government.Whenever inflation goes up, it is a matter of concern, finance minister Pranab Mukherjee told reporters in the capital after inflation numbers were released.
With more than 40% of Indias districts declared drought hit, the high inflationary expectations have pushed up prices of food articles. But economists and agri-commodity analysts pointed out that the prices of food items should start moving down as the kharif produce (summer crops) comes to the market in coming weeks.
The prices of food articles did no go up sharply in the last two severe droughts faced by the country, in 1987-88 and 2002-03. During these years, food price inflation was less than 3-4% and even overall consumer price inflation remained low, insulating the poor from the impact of drought. But currently retail inflation as measured by the three consumer price indices is hovering around 12%.
What makes the current drought different from the earlier ones, which resulted in shortages of cereals and pulses, is that this time the shortage is witnessed largely in perishables such as vegetables, fruits and dairy products.
There is not much that the government can do to bring down prices of these items, said Madan Sabnavis, chief economist at NCDEX, the countrys largest agriccommodity exchange by turnover. But he expects the annual inflation for food items to come down.
High food prices have resulted in a number of electoral upsets in the past. With state elections in Maharashtra, Haryana and Arunachal Pradesh round the corner, the rising inflation becomes a concern. the sub-indices of the WPI, which measures annual inflation for manufactured items and fuel items, remained subdued over the week.
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Tuesday, October 6, 2009
Indian Auto Industry Update October 03, 2009
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