Mumbai: Tata Motors new plant for the Nano at Sanand, Gujarat, will begin ramping up numbers from August 2010 when joint output with Pantnagar will touch 12,000 units a month.

Mr P.M. Telang, Managing Director, told Business Line that the company would start trial production in Sanand from the last quarter of this fiscal before kicking off production in February 2010.

The plant has an annualised capacity of 250,000 units and can be doubled.

He said that from November, Nano production at Pantnagar would be up to 4,000 units from the current level of 2,500 cars.

The company has delivered 7,500 Nanos so far. By the end of 2010-11, numbers from Pantnagar and Sanand are expected to be closer to 1.8 lakh units which would mean that Tata Motors can wrap up all deliveries to customers who booked the Nano.

It is probable that buyers will make a beeline for the car as production increases because they would be assured quicker delivery (waiting period now can go up to a year).

Hybrid bus

Mr Telang said the companys hybrid bus was in its final stages of development. It is expected to be at least 20 per cent more fuel efficient than conventional models and is meant for city transport. The hybrid model will be CNG plus electric, or gasoline plus electric.

http://www.thehindubusinessline.com/2009/10/17/stories/2009101751160400.htm

25,000 CARS SOLD IN A SINGLE DAY!

Amrit Raj Jha

Asian Age (Web Edition)

(Oct 17)

Hyderabad: Riding on festive wave in the country, the countrys largest carmaker Maruti Suzuki has sold 8,000 cars on Dhanteras, the largest on a single day.

The total car sales on Dhanteras is estimated to be around 25,000.

"We have sold 8,000 cars on Dhanteras this year, highest ever in our history," said Marutis executive officer (marketing and sales), Mr Mayank Pareek.

Maruti Suzuki, which sells every second car in India, cleared all its inventories with dealers in a day.

The Japanese carmaker had sold 4,500 cars on the same day last year, almost half of the sales this year, he added. Mr Pareek said, "We were expecting these figures. On Dhanteras, sales are always high in the country. People are bound by the festive sentiments to invest on this auspicious day." This year, however, it was a double dhamaka for the customers, who cashed in on soft interest rates and attractive discounts offered by the manufacturers.

Whether this indicates that the automobile industry is coming out of the slowdown, Mr Pareek said, "It would not be right to say that. We have to wait and see whether this rally continues after Diwali as well?" General Motors, which sold a little over 2,000 cars on Dhanteras, also echoes this view. Its vice-president, Mr P. Balendran, said, "These are the signs of revival. The feel-good-factor is back in the market. But the picture will only get clear once the festive season gets over."

http://www.asianage.com/presentation/leftnavigation/news/business/25,000-cars-sold-in-a-single-day!.aspx

25,000 cars sold in a day on festive demand

Deccan Chronicle (Web Edition)

http://www.deccanchronicle.com/business

INTERVIEWS / FEATURES

THE VEHICLE-CUSTOMISATION MARKET IN THE COUNTRY IS TOTALLY UNEXPLORED: DILIP CHHABRIA

Malabika Sarkar

The Financial Express, (Motobahn)

(Oct 17)

Think automobile design and the first Indian name that comes to mind is Dilip Chhabria and his company DC Design. Founded in 1993, the Indian car design firm DC Design built the first Aston Martin AMV8 Vantage prototype, which was featured at the 2003 Detroit Auto Show. There was no looking back thereafter. In this interview to FEs Malabika Sarkar, Dilip Chhabria, founder, DC Design, talks about how design is emerging as a key differentiator in the automobile industry and what it takes to design a custom-based car.

Does automobile design get as much importance in India as it deserves? Are there any legal issues in remodeling cars?

I do not agree that design is taken lightly in India-made cars. Most vehicles sold in India are present in other parts of the world as well. However, since design is a key attribute in the C, D and E segments and India is largely a market for A and B segment cars, design is perceived to be less prevalent. Customer expectations are rising all the time and manufactures who neglect the design aspect will do so at their own peril going forward. There are usually no issues in remodeling cars the world over as cars are registered prior to their remodeling and there are no structural changes.

What is potential for automobile customisation in India? What is the size of the market for customised cars in the country?

The potential is huge and measurable in line with peoples aspirations and in the absence of credible and competent enterprises to deliver their solutions. Theoretically, the market size could be 2-5% of the total vehicle market by value and this potential is totally unexplored.

Why is it that when it comes to this business of creating customised cars in India, there is only one name and that is you?

It takes a lot to design and build cars and is a hugely daunting task. An enterprise has to have da Vinci character of the artist, engineering and market added to risk taking, courage, faith, passion and hard work. Usually these do not come together commonly.

Why limit your creativity to cars? Why not design television sets, air conditioners and computers? What motivates you about cars?

We have attempted designing office interiors and furniture. However designing television sets etc is low on the value chain and given the growth potential in the automotive segment the need has not arisen.

Which,... in your opinion, are the great automobile design companies in the world?

Usually German and Italian cars such as Porsche, Mercedes, Ferrari, and Lamborghini are well designed.

Do you have a lot of freedom in the direction you push things? What have you been most proud of so far?Please cite one particular project that came off really well?

We usually demand freedom, and the discretion of design is solely ours and is fiercely guarded. One project that is close to my heart is the 2003 GAIA showcased at the Geneva show.

Could we talk a little about the NXG and NXR electric cars you aredesigning for Reva?

The NXG was a DC Design project while NXR was handled as a mentor for them, which had already defined the NXR architecture. The NXG attempted to create a lifestyle run about the product, the USP being design.

You have recently tied-up with Carnation Auto. How would DC Design benefit from this venture?

We would benefit from its nationwide sales and services, which would ensure growth for our company.

You are starting the DC College of Design near Pune this year. How did the whole idea emerge?

Since we are the role models to the youth and since there is a large number of students aspiring to take up car design as a career, we felt the time was ripe for this initiative. There is also the huge growth potential of the auto industry, and the fact that design will play a key role as a differentiator. The design college is expected to be automotive centric as far as design, engineering and marketing are concerned.

Where would the funds come from?

We have been trying to raise funds, but so far our attempts here have not been successful as education is controlled by the government.

http://www.financialexpress.com/news/the-vehiclecustomisation-market-in-the-country-is-totally-unexplored/529934/2

TWIST OF PHAETON

Kyle Pereira

Business Standard, (Motoring)

(Oct 17)

Mumbai: We drive an expensive Volkswagen. No, its not the Veyron Kyle Pereira

The speedo needle is flickering in the upper regions of 220 kph and the road ahead is Casanova straight, has a faultless surface and my lane is devoid of any traffic. Push my right foot down any more and the sole of my shoe might scrape onto the front wheel. The needle is still moving to the right till it begins to settle around the 230 kph mark. Then, the type of sections that the worlds fastest roads are so proud about ends, and since overspeeding fines are steep and your license is apparently wrested away, I bend over backwards and settle at a pace befitting the stipulated 80 kph speed limit.

Driving on the autobahn is awesome and exciting. Unless youre behind the wheel of the flagship Volkswagen, the Phaeton. Though that might seem condescending, it isnt. VW went out to build the numbest car known to mankind, and they are sure that many a Richie Rich would spend top dollar to get one of these into his personal parking lot. Seems like quite a paradox, doesnt it?

Glance at the Phaeton and you can see how under-designed it is. It is built like a proper Panzer, but looks as inoffensive as possible. Simple is good, the Germans believe, and that should make you want one, it seems. Opulent Indians who can afford this S-Class competitor want sober automobiles; something refined that doesnt scream for attention like a political party canvassing for the elections.

But VW didnt ask me what I wanted from a premium segment car (predictably, since Im light-years away from being a member of the intended target customer group), and they went right ahead and did what they do best build a grand factory to make sober cars costing top dollar. But the Phaeton isnt hollow gold, really. To get under the skin of this car, you need to think differently. You have to steer clear of the common stereotype that moneyed folk are brainless and classless twits who date women with more silicon in them than that valley in north California. The Phaeton is a car that few would understand, much less aspire to own, and that suits them well enough. The glass factory in Dresden, also called the Transparent Factory produces a hefty 24 cars a day. The time taken to fit the windshield on the Phaeton is probably longer than that taken by a Japanese factory to completely manufacture 24 cars, half a dozen tubas, some karaoke machines and a minivan.

Sit at the back and you begin to realise how much you appreciate that vacuum. The lack of road noise seeping into the cabin creates a silence that hurts your eardrums. Drive over an expansion joint on a bridge and the suspension irons it all out. Your seat feels like a down-stuffed mattress but this is the sort of car that demands you hire a chauffeur, because sitting anywhere else but on the back seat is doing gross injustice to the Phaeton. Sure, you dont have 18 different adjustments for your rear couch like the ones in front do, but theyre not needed, really.

So while youre running your multi-billion dollar empire from the rear seat, the airconditioning keeps you as cool as a cucumber even when the going gets white hot. The aircon louvres open up like the stage curtains of a grand auditorium, which is quite dramatic, really. Also, the draft-free cooling system is so designed that it prevents your eyes from getting bloodshot due to the blast of the airconditioning after a long drive. Well, yes, the Phaeton has so many little things that go into it that theyre close to impossible to list out completely.

The theatrics dont just stay indoors. The Phaeton is fitted with sensors that detect vehicles that are in the blind spot in your rearward field of vision. When it detects something, small lights mounted on the side rear view mirrors light up. Which mirror lights up is dependent on the side of the car that the offending vehicle is on. For example, if theres a moron clinging to your starboard, the left mirror LED will glow. I tried to gauge how effective this system is, but the side rear view mirrors are so well designed that not once did I miss out on any car that the system picked up later.

Although its almost certain that the radar wont be offered here if at all the Phaeton makes it into India, its a great thing to have. What it does is that it measures what the proximity of your car is to the vehicle in front of you. If it is less than the distance that was pre-determined and set by the driver of the VW, the system activates the brakes to lesse n the speed, to widen the gap between the Phaeton and the vehicle just in front.

Driving the Phaeton is a pleasurable experience. No, its not exciting to drive; soothing and relaxing is more like it. But look at it this way, its meant to lug around corporate head honchos and heads of state, not speed junkie youngsters out for a tyre shredding drive. The steering wheel feels a tad numb and the 3- litre V6 diesel, with all its 238 bhp of power and 50.8 kgm of torque, is good for about 200 kph with ease. Although VW claims a top whack of 240 kph, it takes its own sweet time to get to any speed close to that, and off the autobahn, its virtually impossible to hit without running out of road.

The ride is brilliant, predictably, and the car rolls over road imperfections with the grace of a ballet dancer. It could be different if driven on Indian roads, however, since the undulations on German roads are, well, just undulations and not the craters on our roads that resemble the ones that are caused due to anti-tank mines going off.

Whats spectacular about the Phaeton is its handling, which totally belies its rather bland exterior. The thing will stick to the road, and go precisely where you want it to even when youre whizzing at over 180 kph. The confidence it imparts is awesome and suddenly, all you want to do is leave the arrow straight autobahn and head towards the twistier back roads. Such are the enormous boundaries of the Phaetons handling and dynamic characteristics that its virtually impossible to bring the traction control into service. However, notice that Ive prefixed the impossible with virtually. The reason of course is that the Phaeton is a four-wheel drive sedan, which makes it that much more sure-footed. But VW has given 4WD for a reason because its not a rear-wheel drive car unlike the competition, the Mercedes S-Class and the BMW 7 Series.

The question that crops up at the end of all of that is, if at all VW gets the Phaeton here, should you buy it? Well, lets tackle that question with a series of short questions with even shorter answers. Would being seen in the big VW bring about an image of opulence and great power upon uninitiated bystanders? No. Would the Phaeton open up hallowed doors like a big sedan with a certain star on the bonnet would? Er, I dont think so. Does looking at the Phaeton make one weak in the knees and drench ones shoes with drool? Not really.

So there you have it, the Phaeton is great if youre well-heeled but would like to keep that fact to yourself. Now, there arent too many of those types around, I reckon.

http://www.business-standard.com/india/news/twistphaeton/373457/

CARs,SUVS & MUVs

CARMAKERS SHIFT FOCUS TO NEW OVERSEAS MARKETS

Chanchal Pal Chauhan

The Economic Times (Web & Print Edition)

(Oct 19)

New Delhi: The countrys top carmakers are shifting their focus to alternative overseas markets after exports to Europe, one of the top destinations for India-made cars, dropped sharply last month as most countries in the continent ended cash incentives for consumers to buy small fuel-efficient vehicles.

Hyundai Motor India, the countrys largest car exporter, has identified about 15 new markets for exporting its small cars. The wholly-owned arm of South Korean firm will export its i10 and i20 hatchback models to Australia, New Zealand, Iraq, Israel and Vietnam, among others.

The other top exporter Maruti Suzuki plans to enter South Africa, which is the single-largest market for Indian vehicles and about 10% of the five lakh passenger vehicles sold annually there are made in India. The countrys largest carmaker is also tapping west Asia and Latin America in its bouquet of 22 non-European markets.

We were anticipating sales in Europe to lose stream after the incentives dried and have hedged our exports by developing new markets to meet out export and production commitments, said Mayank Pareek, executive officer for marketing and sales at Maruti Suzuki.

The company exports its M800, Alto, Omni, WagonR and Estilo models to non-European markets such as Chile, the UAE, Algeria and East Africa, while a bulk of its exports are from A-Star, its main product for Europe.

Hyundai Motor and Maruti Suzuki managed to maintain their export momentum till August, but growth started decelerating from September. While Maruti Suzuki exported 11,712 cars, growing 85% against 165% in August, Hyundai Motor managed to export 26,001 cars, up 9% in the period.

Total exports grew 21.6% in September compared to over 30% in the last few months, forcing carmakers to change their strategy. While orders from Europe are still pending and are expected to a cover major part of production in 2009, these companies are looking at new markets for incremental numbers.

Overall exports grew 34% to 2.11 lakh cars in the first half of the current financial year. Hyundai Motor exports cars to over 100 countries from its Chennai plant and is banking on new markets to maintain its steady growth of 16% to 1.39 lakh cars in the April-September period.

We are looking at additional numbers from the new markets. Markets such as Australia sell more than a million cars annually and New Zealand is also big. As global market are shifting towards fuel-efficient small cars, we are looking at a larger chunk in the long-term from our hatchbacks, said Arvind Saxena, senior vice-president for marketing and sales at Hyundai Motor India.

http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Carmakers-shift-focus-to-new-overseas-markets/articleshow/5137461.cms

CAR MANUFACTURERS UNABLE TO MEET ORDERS, ASK BUYERS TO WAIT

Samar Srivastava

mint (Web & Print Edition)

(Oct 19)

New Delhi: A sudden and unexpected jump in demand for cars in the lead-up to the festive season has resulted in several popular models being placed on the waiting list.

MarutiSuzuki India Ltd, the countrys largest car maker, says it expects this situation to continue for the next few months at least, indicating a strong and sustained recovery for the auto sector.

Domestic demand would remain strong for the next six months, said Shashank Srivastava, chief general manager, Maruti Suzuki. This is likely to result in waiting periods for models such as the A-Star, Ritz, Swift and the Swift Dzire continuing well beyond the festive season, he added.

Auto makers who had been caught by surprise by the sudden dip in demand in the last festive season had been cautious about ramping up production this time around.

Several companies found themselves without enough staff to handle surging demand as they had laid off the majority of their contract employees.

Car sales rose by one-fifth last month and analysts expect them to continue on the same track in October. While the numbers may look better than normal due to the base effect, when muted growth in one year makes next years numbers look better, analysts say the overall growth trend is hard to miss. Everyone was expecting demand to pick up gradually but it has been rather sudden, said Vaishali Jajoo, an auto analyst at brokerage Angel Broking Pvt. Ltd.

While auto makers such as Hyundai Motor India Ltd have added a third shift, others such as Honda Siel Cars India Pvt. Ltd and General Motors India Pvt. Ltd are watchful about raising production.

Honda continues with a two-shift operation producing about 300 cars a day at its plant in Greater Noida, according to a spokesperson. The company has asked customers to be prepared to wait for six weeks for delivery of its popular City model and four weeks for the Civic. However, the company does expect a lessening of demand after Diwali.

Skoda Auto India Pvt. Ltd, which makes high-end sedans such as the Superb, has also seen wait times increase. Prospective Superb buyers have been asked to wait between eight and 10 weeks for delivery.

Overall demand will continue to move up, said Ashutosh Dixit, senior general manager, sales and network development at Skoda Auto India. He declined to speculate on demand after the festive season. Waiting periods for Marutis cars are also a result of manufacturing constraints.

Its two plants and Gurgaon and Manesar are producing flat out and the company is currently in the midst of meeting its export commitment of 100,000 A-Star cars for the European market. Rising demand for the companys cars has not gone unnoticed by the markets.

Its stock price closed at Rs1,520.55 last week on the Bombay Stock Exchange, up 193.4% this year. In the same time the Sensex has risen around 80%, while the BSE Auto Index has risen 171%.

http://www.livemint.com/2009/10/18225830/Car-manufacturers-unable-to-me.html

FIAT READIES TO GIVE PALIO NEW LIFE AFTER A LONG STRUGGLE IN SALES

Swaraj Baggonkar

Business Standard (Web & Print Edition)

(Oct 17)

Mumbai: Italian auto manufacturer Fiat has decided to give its oldest surviving model, the Palio, a facelift and a major marketing push, thereby ruling out any phasing out of the model although it has been in production for over eight years.

The company will launch a refreshed Palio in the next three to four months with a competitive price tag, according to an executive from Fiat India Automobiles. The existing Palio (base model) is sold at Rs 3.45 lakh (ex-showroom, Mumbai).

In addition, the petrol engines 1.1 litre, 57 bhp and the 1.6 litre, 100 bhp seen in the existing Palio may either get upgraded to suit Bharat Stage IV (BS-IV) emission norms or may get replaced by engines that power another Fiat model, Grande Punto.

The Punto is driven by a 1.2 litre (FIRE) engine that develops 68 bhp of maximum power, as well as a 1.4 litre (FIRE) engine that generates 90 bhp of peak power. The 1.3 litre multijet diesel engine seen in the Palio is already BS-IV compliant and does not require upgradations.

Eleven cities in India will change to BS-IV norms from April 2010 as part of global emission control action aimed at containing harmful gases released by automobiles.

Although the Palio has become an old model now, it continues to serve our strategic purpose of being the entry level model in our range, while complementing the Punto. It was, hence, essential to infuse some refreshments to the model to keep it under production, said a senior executive from the company.

Though the company preferred to maintain secrecy about the product until its launch, sources say the new Palio may get a new grille and a new dashboard assembly, much on the lines of the recently launched and facelifted Brazilian Palio.

Fiat India will thus generate a major marketing push to reignite the demand for the Palio, which has considerably slowed due to fierce competition. Despite the price of the current Palio, considered aggressive, it fails to pull customers looking for other hatchbacks such as Hyundai i10, Maruti Suzuki A-Star and Chevrolet Spark, in a similar price band.

Sales of the current Palio are pegged at 250-300 units a month. In contrast, the Hyundai i10 clocks more than 5,000 units a month, according to industry officials.

Auto experts say a facelift by the company was expected. A complete phase-out of the Palio will result in a huge void in Fiats model line-up in India, which will be difficult to afford, said an expert.

The existing version of the Palio was launched by the company in April 2007, with an additional and highly efficient diesel engine. The four-seater hatchback was first launched in September 2001. Though initial sales were encouraging, it lost in succeeding years to intense competition, Fiats infamous service back-up and also due to cars fuel guzzling nature.

Meanwhile, Fiat India is considering an upward revision of prices for the Punto and Linea after the end of the current quarter. The increase will be made to even out the rise seen in international metal prices and the impact of the euro, which has become costlier for its suppliers.

http://www.business-standard.com/india/news/fiat-readies-to-give-palio-new-life-afterlong-struggle-in-sales/373529/

GM CHARGED ABOUT SPARK-ELECTRIC

Virendra Pandit

The Hindu Business Line (Web & Print Edition)

(Oct 19)

Ahmedabad: After launching Chevrolet Cruze across North, West and South Indian cities this week, General Motors India Pvt Ltd is now racing ahead for the December launch of its mini-car Beat and next years Spark-Electric.

The company is also working on the Aveo-CNG to be launched next year, company officials said here. The Beat would be priced around Rs 4 lakh. We are going to manufacture not in hundreds but in thousands the electric car we would be launching next year, Mr Karl Slym, President and Managing Director, GM India, told Business Line after the Cruze launch here, referring to the Spark-Electric, to be manufactured in joint venture with the makers of electric car Reva.

But Spark-Electric would not be a Reva-clone. In fact, Reva-makers would continue to do their business as usual. We would be using only their technology, as engineering and manufacturing of the environment-friendly car would be done at GMs own plants, said Mr P. Balendran, Vice-President.

GMs mini-car Chevrolet Spark has already sold 3.50 lakh pieces globally and its electric version, whose price tag would be determined in accordance with the market conditions prevailing at the time of the launch, would almost remain the same in design.

The company also expected government subsidy and other tax benefits for this environment-friendly vehicle. For the electric car, the customer would be given the choice of buying an ordinary or a lithium battery which would make it run at the speed of up to 60 or up to 120 per charge respectively. Depending on the battery, the price of the car could be up to Rs 3.50 lakh.

Since a key problem for electric vehicles is battery charging stations, GM India could tie-up with the petrol pumps of various companies. We already have a joint venture with Bharat Petroleum Corporation Ltd (BPCL) for servicing our vehicles at some places, which can be replicated, said Mr Slym. For the success of the battery-run car, electric charging stations on roads and highways are a must, he said.

GM is also exploring battery technology procurement from majors such as Eveready. But, to start with, the company would import batteries or procure them locally. To market the Spark-Electric, the company is increasing the number of its dealerships from the existing 195 to 250 this fiscal. Similarly, the number of authorised service outlets would be increased from 198 to 250 across the country.

In addition, GM has also set-up four spare-parts distribution centres at Talegaon, Halol, Chennai and Delhi to ensure easy availability.

http://www.thehindubusinessline.com/2009/10/19/stories/2009101950870200.htm

GENERAL MOTORS MULLS MINIVAN LAUNCH IN INDIA

Danny Goodman

Business Standard (Web & Print Edition)

(Oct 19)

New Delhi: General Motors India will launch its light commercial vehicles, popularly called minivans, in the domestic market in the medium future. The launch of the light commercial vehicles in association with our Chinese partners would happen in the medium term, says Karl Slym, President & Managing Director.

Company executives say the launch of GMs third compact car, Beat, scheduled for launch in early 2010, is top priority. Then, we have to gear up for introduction of the petrol automatic version of the Cruze. Later, we would turn our attention to the minivan launch. Its all at the discussion stage, says one GM executive. Which means the roll out of GMs minivans in the domestic market could well be after 2010.

The Society of Indian Automobile Manufacturers classifies minivans as multi purpose vehicles (MPVs), in which Maruti Suzukis Omni & Versa, and TataMotorss Ace Magic, are listed. Slym says his minivans would have to be manufactured in India to be price competitive, and be available in the diesel engine option.

In China, GM (Asia Pacific) manufactures these minivans in a tripartite joint venture with two Chinese companies, Wuling and SAIC. Aided by Chinese government subsidies, GM China sells around 80,000 units of these minivans every month and commands a market share of 43 per cent in the Chinese minivan segment. Popular models are the Wuling N200 and the N 300 series. GM India officials say these are likely to be the models for the domestic market.

Talk of models, market segmentation are all at the initial stage of discussion. Theres nothing that we can comment now. On the issue of whether it will be Chevy or Wuling badged, its too early to comment, says the GM executive.

Earlier, Jonathan Browning, vice-president, global sales & marketing, of GM said: The brand is well-suited for the Indian market. Its definitely an opportunity for us to launch these minivans in the country, with product adjustments. Entering the light commercial vehicle market is the most logical step to strengthen our portfolio.

http://www.business-standard.com/india/news/general-motors-mulls-minivan-launch-in-india/373613/

COMMERCIAL VEHICLES

TATA DAEWOO ORDERED TO RECALL TRUCKS IN S KOREA

PTI

See this story in: The Hindu Business Line (Web & Print Edition)

(Oct 19)

Seoul: The South Korean government has ordered Tata Daewoo Commercial Vehicle, Tata Motors' joint venture here, to recall 3,276 trucks due to safety reasons in steering system in its three models, officials said on Sunday.

The government ordered the recall for three different models of trucks made by Tata Daewoo Commercial Vehicle Co., cited for problems in the steering column.

The measures cover 19 tonne, 19.5 tonne and 25 tonne trucks made from August 16, 2004 to the end of 2007, the Ministry of Land, Transport and Maritime Affairs said.

A total of 3,276 vehicles were made during that period, Yonhap news agency reported.

The Government inspectors said the auxiliary system functions for less than three minutes, failing to meet minimum safety requirements set for such large commercial trucks.

Owners of affected vehicles can visit maintenance shops of Tata Daewoo from Monday and get free repairs.

Tests conducted on the vehicles showed problems in the auxiliary control mechanism that is used when the main power steering system malfunctions.

Tata Daewoo was launched in March 2004 when Tata Motors purchased South Korean truck maker Daewoo Commercial Vehicle. Tata Daewoo is the second largest heavy duty commercial vehicle manufacturer in the country, the website of the company says.

The company produces cargo, dumpers, tractors, mixers and special purpose vehicles. - http://www.thehindubusinessline.com/blnus/14181710.htm

Tata Daewoo ordered to recall 3,000 trucks in SKorea

Hindustan Times (Web Edition)

http://www.hindustantimes.com/News/auto/Tata-Daewoo-ordered-to-recall-3-000-trucks-in-SKorea/Article1-466452.aspx#

Tata Daewoo ordered to recall 3,276 trucks in South Korea
The Pioneer (Web & Print Edition)

http://www.dailypioneer.com/209716/Tata-Daewoo-ordered-to-recall-3276-trucks-in-South-Korea.html

Tata Daewoo to recall trucks in S Korea

The Statesman (Web Edition)

http://www.thestatesman.net/page.news.php?clid=12&theme=&usrsess=1&id=272231

Tata Daewoo ordered to recall 3,000 trucks in SKorea

mint (Web & Print Edition)

http://www.livemint.com/2009/10/18120415/Tata-Daewoo-ordered-to-recall.html

Tata Daewoo ordered to recall 3,000 trucks in SKorea

The Economic Times (Web & Print Edition)

http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Tata-Daewoo-ordered-to-recall-3000-trucks-in-SKorea/articleshow/5135840.cms

Tata Daewoo told to recall 3,276 trucks in S Korea

Business Standard (Web & Print Edition)

http://www.business-standard.com/india/news/tata-daewoo-told-to-recall-3276-trucks-in-s-korea/373616/

Tata Daewoo ordered to recall 3,276 trucks

The Indian Express (Delhi Print Edition)

Tata Daewoo asked to recall 3276 trucks

The Times of India (Delhi Print Edition)

CONSTRUCTION & AGRI MACHINERY

- - - - -

TWO & THREE WHEELERS

HERO HONDA LAUNCHES NEW HUNK, SPLENDOR

Agencies

See this story in: The Financial Express

(Oct 17)

New Delhi: Aiming to cash in on the ongoing festive season, the country's largest two-wheeler maker Hero Honda launched new versions of its two motorcycles -- Hunk and Splendor.

While the high-end refreshed Hunk will be available for Rs 56,675 (ex-showroom Delhi), the special edition of the flagship Splendor+ is priced at Rs 40,000 (ex-showroom, Delhi).

"Hero Honda has always believed in bringing added cheer to its customers during the festival season. Now with the introduction of the new Hunk and the special edition Splendor+ our customers are going to have an exciting festival season," Hero Honda Senior Vice President (Marketing and Sales) Anil Dua said in a statement.

The company has brought out the special edition of the 100cc Splendor+ to commemorate the bikes' cumulative sales figure of one crore, he added.

The special edition of the volume-driven bike would have features such as all black engine and alloy wheels.

Without giving further details the company said, "some more launches are lined up in the coming months."

http://www.financialexpress.com/news/hero-honda-launches-new-hunk-splendor/529864/

Hero Honda launches new versions of Hunk, Splendor

The Hindu
http://www.hindu.com/2009/10/17/stories/2009101755951300.htm

Hero Honda unveils new variants of Hunk and Splendor

Business Standard

http://www.business-standard.com/india/news/hero-honda-unveils-new-variantshunksplendor/373509/

Hero Honda launches new versions of Hunk, Splendor

The Economic Times

BAJAJ AUTO NET UP A HEFTY 117%

Shally Seth

mint

(Oct 17)

Mumbai: Indias second largest two-wheeler maker Bajaj Auto Ltd on Thursday reported its best operating margins for the quarter ended September, signalling that managing director Rajiv Bajajs strategy of focusing on high-end bikes and premium segment entry-level motorcycles is paying off.

Bajaj Autos net profit vaulted 117% to Rs403 crore, beating Street expectations for the second quarter in a row as it sold more Discover motorcycles and exports rose.

Operating margin expanded to 22% from 13.5% a year earlier as sales increased 14.62% to Rs2,887.51 crore from Rs2,519.18 crore. Bajaj Autos rival Hero Honda Motors Ltd, which sells two of every three bikes in the country, has on an average been reporting an operating margin of 14-17%.

Bajaj sells the Discover 100cc, introduced in mid-July, at a premium of Rs800-8,000 to rival Hero Hondas CD Dawn and Splendor models. The company sold 160,000 units of Discover and a greater contribution of bigger displacement bikes from the Pulsar range also helped margins.

In October 2006, Bajaj had announced plans of exiting from the 100cc segment as it was not making money. The new Discover is produced at the firms unit in Uttarakhand that offers excise duty benefit. As volumes grow, the firm will be able to leverage the benefit better. It gained from lower expense on raw materials such as steel and aluminium.

The quarter has been by far the best for Bajaj Auto in terms of sales, export volume, net profit and operating margin, the firm said. With 81,000 units exported in September, its likely to exceed the annual target of 800,000, the firm said.

Despite the stellar performance, Bajaj Auto shares lost 3.37% on the Bombay Stock Exchange to close at Rs1,554 apiece as investors booked profits. The bellwether equity index, the Sensex, lost 0.21%.

The company attributed the success to the strategy of focusing on the more profitable category of bigger and sportier motorcycles, reflecting in higher operating margins.

Sales of the newly launched Discover have been surprising, said Joseph George, analyst at BNP Paribas Securities Ltd. Bajaj Autos sales grew 7% to 686,727 units in the quarter. Of this, exports made up 224,334 units, up 8% from a year ago. Exports typically offer better realization than the domestic market. Though the firm believes sequential improvement in volumes backed by newer products will help it offset the impact of rising steel and aluminium prices, not all analysts are convinced that it can do so.

Margins might come under some pressure due to higher raw material costs, said Umesh Karne, analyst at Brics Securities Ltd. After the third quarter, they will have to re-negotiate their contracts.

Mahantesh Sabarad, an analyst at Centrum Broking Ltd, doubts whether the volumes are sustainable as what we are seeing now is a function of postponed demand from last year.

First Global Securities Ltd believes the second half will be better for Bajaj Auto on the volume and margin fronts. The company will benefit from lower input costs and also record an increase in export revenues on the back of its new launches, First Global said in a report released on Thursday after the firm announced its earnings.

George said with Bajaj Autos forward contract booking concluding by the end of fiscal 2010 and the rupee appreciating, margins will taper off from fiscal 2011. The rupee appreciated 0.42% to Rs48.11 in September from June. On Thursday, it closed at 46.24 a dollar, after hitting 45.81.

While Hero Honda has adopted a volume strategy to retain its leadership position in the two-wheeler market, Bajaj Auto has been operating in the higher-end segment to have a competitive edge. Hero Honda, which reports earnings on 21 October, is also expected to report a much better margin than the previous quarter.

http://www.livemint.com/2009/10/16005227/Bajaj-Auto-net-up-a-hefty-117.html?h=E

KINETIC CHARTS PLAN FOR ELECTRICAL GOODS FORAY

Garima Singh Neogy

The Telegraph

(Oct 19)

New Delhi: Punebased Kinetic Motors plans to enter the electrical goods and consumer durables businesses. Kinetic, one of Indias oldest automotive brands, had earlier partially exited from two-wheelers.

The company is in the final stages of drafting its plans. It will also review its auto component business.

For the last five to six years, Kinetic has been working on a restructuring plan. We are a very strong brand and now want to venture into a totally new area like home automation. Also, we will renew our focus on our existing auto component business. You will soon see us entering peoples home directly. We are sure our products will be very well received by customers, Sulajja Firodia Motwani, managing director of Kinetic Motors, told The Telegraph. Motwani, however, refused to divulge details about the new product line.

According to sources, the company may look at generator and inverters to begin with. Later, it will also look into the auto accessory market. Strategies for consumer durables a market dominated by Korean companies will be based on its experience in generators, inverters and car accessories.

Our first product should be out in the market in the next three to four months, said Motwani.

Last year, utility vehicles leader Mahindra & Mahindra (M&M) had announced its entry in the two-wheeler segment by acquiring an 80 per cent stake in Kinetic Motor Company Ltd.

Kinetic continues to hold a 20 per cent stake in the new company Mahindra Kinetic Scooters & Motorcycles Ltd.

http://www.telegraphindia.com/1091019/jsp/business/story_11630780.jsp

LOHIA AUTO AIMS FOR EIGHT-FOLD JUMP IN SALES

PTI

See this story in: The Hindu Business Line

(Oct 19)

New Delhi: Electric two-wheeler maker Lohia Auto Industries is aiming to increase its sales by nearly eight fold to 90,000 units in the domestic market in the next five years, enhancing its portfolio gradually.

The company, which sells two electric scooter models, will launch two more new products, including one in the high-speed category, in the next 3-4 months.

We want to be a leader... In the next 2-5 years, our target is to sell 90,000 units (of electric scooters in the domestic market... It's an ambitious target, Lohia Auto Industries Chief Executive Officer, Mr Ayush Lohia said.

He said the two-wheeler segment of the Indian electric vehicle (EV) industry produces about 1.2 lakh units annually and it is likely to touch 5 lakh units within next five years.

We are targeting 20 per cent of the two-wheeler EV market by 2014, he said, adding the firm, which entered the electric scooters market in May this year, expects to sell 12,000 units this year. About future products, he said the company would expand its portfolio by two more products.

We will launch one e-scooter in the Trade Fair next month. One more scooter, which will be a high-speed one, will hit the market during the Auto Expo in January next year. http://www.thehindubusinessline.com/blnus/02181410.htm

Lohia Auto sets sales target
The Economic Times

AUTO COMPONENTS

MIXED EARNINGS SEEN FOR AUTO PARTS COS IN JULY-SEPT

Reuters

See this story in: The Economic Times

(Oct 17)

Mumbai: India's auto parts firms may report mixed earnings in July-Sept as persisting export weakness partly offset a domestic market recovery, analysts said.

Firms with sizeable exports exposure may post slack export volumes following the decline in demand from most of the developed countries due to the overall economic slowdown, Angel Broking said in a report earlier this month.

"Broadly, the sector is expected to deliver mixed bag earnings owing to exaggerated losses by ancillary companies for their exposure in overseas markets," it said.

Motherson Sumi and Amtek Auto are likely to report drop in quarterly profits, while Bharat Forge may report a sharp rise, a poll showed.

"Though global recession had affected the Indian auto components industry, it is now slowly coming back on track," Prabhudas Lilladher said in a note.

"There has been an increase in production schedules at auto component firms post March quarter following two stimulus packages and substantial improvement in the volumes of auto companies," it said.

Bharat Forge, India's top forgings maker, is expected to see higher profits, mainly on account of reduced forex losses due to a one-time forex loss of Rs 87.5 crore a year ago, analysts said.

"But if you compare their profits excluding this exceptional loss then adjusted profit is expected to fall due to weaker sales," said an analyst, who did not want to be named.

Sales would be lower on year as the year-ago period was a good quarter for most auto ancillary firms, the analyst said.

"However, if we take sales sequentially then there would be an improvement this quarter," he added.

Motherson Sumi Systems Ltd is likely to see net sales soar but profits will fall due to certain restructuring costs related to the acquisition of Visiocorp earlier this year.

Motherson Sumi had acquired Europe's Visiocorp's rear view mirror business in March, which was then renamed as Samvardhana Motherson Visiocorp Solution. The firm is restructuring Visiocorp's operations in Europe and Australia.

"The acquisition will have an impact on their margins. They are doing a lot of restructuring of overseas plants. That restructuring cost will be spread over the next two-three quarters," said Vaishali Jajoo, analyst at Angel Broking.

However, sales may surge on the back of the acquisition and on an improving domestic passenger vehicle market, which forms a major portion of Motherson's overseas revenue, analysts said.

Car sales rose an annual 21 per cent in September for their eighth straight rise, with industry expecting continued robust growth. The BSE Auto index more than doubled in the first half of the current fiscal.

Amtek Auto Ltd is also likely to see a fall in net profit due to weak performance of its overseas subsidiaries and high interest and depreciation costs, Jajoo added.

Bharat Forge is expected to report a 127 per cent rise in standalone net profit to Rs 25.6 crore.

Motherson Sumi's consolidated profit is expected to fall 23 per cent to Rs 32.6 crore and Amtek Auto may report a 73 per cent drop to Rs 21.6 crore.

http://economictimes.indiatimes.com/news/news-by-industry/auto/auto-components/Mixed-earnings-seen-for-auto-parts-cos-in-July-Sept/articleshow/5130682.cms

AUTO PARTS SOURCING FROM INDIA ON A STEADY UPSWING

Malabika Sarkar

The Financial Express, Motobahn

(Oct 17)

A report from the Automotive Component Manufacturers Association of India (ACMA) estimates the turnover of the auto component industry in India at $18 billion-plus in 2007-08, representing a 27.2% growth since 2002. It says the industry will touch $40 billion by 2015-16. By then Indias share in the global auto component market is likely to grow from the current 1% to nearly 3%.

While still small, the growth in the auto component industry in India is driven both by the growth in the domestic automobile industry and by the fact that a large number of global car manufacturers are zeroing in on India as a hub for component sourcing. Major original equipment manufacturers (OEM) including Ford, BMW, Volkswagen, Daimler, Fiat, Hyundai, Renault, Nissan and GM and component manufacturers like Caterpillar, Bosch, Eaton etc are part of this league. Cost pressures due to the economic slowdown are forcing OEMs to work on sourcing plans from India, says Abdul Majeed, leader, automotive practice, PricewaterhouseCoopers. There is significant saving on components sourced from India compared to component manufacturers in the developed markets.

According to industry estimates, components made in India and China are 10-15% cheaper than those made in Europe and in the US. Till about a couple of years ago, Indian components were sourced for a handful of European markets. Vehicle manufacturers are looking to source components from India for their plants in developed as well as developing markets such as North America, Brazil, Argentina and Russia. European manufacturers are likely to enjoy a cost advantage of 20-25% here and Latin American manufacturers nearly 10%.

India would always have low-cost country advantage, says Jayant Davar, president, ACMA. Though we have cheaper products, we are extremely quality conscious. We also have the sense of flexibility to cater to different volumes and segments. No company would outsource until and unless it has a distinct advantage of 20-25%. There are over 100 international purchasing offices in India, which source out components from the country.

The availability of a large pool of engineers and skilled labour is also helping home-grown auto component companies serve the global OEMs more efficiently.

Globalisation in the Indian auto industry over the last few decades has exposed Indian components manufacturers to international quality systems and standards, says Majeed. They have built excellent relationships with domestic and international vehicle manufa- cturers, which have helped these companies develop their R&D capabilities. Some of the component manufacturers have acquired compa- nies overseas to expand their reach and access advanced technology.

Overall, the industry is upbeat. We have been supplying parts and assemblies to our overseas vehicle manufacturing plants since 2004, says KG Mohan Kumar, director, Toyota Kirloskar Auto Parts. We supply parts to vehicle manufacturing locations in the ASEAN region and in South America and South Africa. From these locations, the vehicles are sent to countries in Europe and to Australia. In all, vehicles are sold in over 58 countries fitted with our parts and assemblies.

According to reports, Italian auto major, Fiat Group Purchasing, plans to buy auto parts worth $1 billion (around Rs 4,900 crore) from India by 2010 for its European and other operations. Niraj Hans, India head for Fiats purchasing office, says, Being an emerging market India enjoys an obvious cost advantage. First, it was Europe, then America; its time now for China and India to service the global markets.

Japanese auto major Nissan Motors said that it would source auto components worth $40 million from India by 2011-12. South Korean auto major Hyundai Motor Company too is looking at increasing sourcing components from India for its global operations. It is also reported that Germany luxury car maker BMW plans to increase component sourcing from India for its global operations. Currently, the company sources components like horns for cars and handle bars and die cast from India.

General Motors is planning to source components worth $1 billion from India. So is Ford, which is looking to import components worth $500 million from India for its world-wide operations. If you compare Indian components to those available in, say, Korea, we are 10-15% cheaper but comparable in terms of quality. Quality-wise, we are equal to Europe and price-wise, cheaper says P Balendran, vice-president, General Motors India. In two to three years time we would source out components worth $1 billion from India. Last year the market had slowed down that had affected sourcing, but we are hopeful we will soon pick up pace.

Both the sourcing companies as well as the supplier benefit from this. The competitiveness of suppliers gives them access to the global markets of OEMs. The sourcing companies get access to low cost trained manpower, low cost engineering and large reserves of natural resources. This also opens up the potential of alarge growing domestic market that is looking to ramp up... demand..

http://www.financialexpress.com/news/auto-parts-sourcing-from-india-on-a-steady-upswing/529933/3

TATA MOTORS EYES 16% GROWTH FROM SPARES BIZ

Manu P. Toms

The Hindu Business Line

(Oct 19)

Mumbai: Tata Motors passenger car division unit expects a 16 per cent growth in its spare parts business for the current year.

Last year, we clocked a revenue of Rs 625 crore and expect it to grow to Rs 725 crore this fiscal, Mr Vikram Sinha, Vice President, Tata Motors, told Business Line.

The overall auto parts business in India, which includes trucks, buses, cars, two- and three-wheelers, is estimated at Rs 36,000 crore, of which 20 per cent is in the hands of the original equipment manufacturers such as Tata Motors, Mahindra & Mahindra and Eicher Motor.

The need for spares is especially high in commercial vehicles largely due to the fact that they face rough use through the year.

Commercial vehicles are considered industrial products and are treated more like machines. Cars, on the other hand, stand for comfort and convenience and customers are more demanding when it comes to service, Mr Sinha said.

As the vehicle population grows, so does the business of spare parts. At present, there are around 14 lakh Tata cars on Indian roads, he added. Incidentally, spares for the Nano have reached all service centres.

http://www.thehindubusinessline.com/2009/10/19/stories/2009101950810200.htm

MIND THE GAP

Arun Jaura

The Financial Express, Motobahn

(Oct 17)

Options and features in vehicles can be as perplexing as the menu in a fast food eatery, and for an untrained eye, dealership visits can be intimidating. The complex sales pitches make it even more confusing since each OEM claims the offered feature to be the best value for money. The challenge for a consumer is to compare the bandwidth of the particular feature on different vehicles by different OEMs since the cost to customer could vary widely. An auto buff can compare the features with the price and understand the cost of ownership and effectiveness of offering. The success for a consumer is in having these features with simple controls at an affordable cost.

In todays driving ecosystem there are many features that a consumer wishes to put on their list of must haves. The recent monsoon in Delhi and Mumbai had commuters stuck in their vehicles for hours. Imagine being there on a slope, where you are operating a hand brake with one hand, steering with the other, clutch and gas pedal with either feet, to avoid bumping into others. That could be significantly stressful and degenerate joints, muscles and ones neural network. An automatic transmission is something that could possibly alleviate this situation. Although many OEMs offer this feature, it is still not popular. A general perception about automatic transmission vehicles is that they have a lower fuel economy compared to manual transmission, which is true to a large extent. A properly designed, integrated and calibrated automatic transmission will actually not affect fuel economy. Whether all the OEMs will be able to do this well is a different subject .

Another confusing feature that is high on the consumer list is handling and steering and cabin comfort. The differentiation is in the multiple steering settings and engine response. One can blend the comfortable and cushy ride with an ordinary power steering and a peppy engine response. Others may offer a couple of manual steering settings and a step function engine response. Alongwith vehicle handling and steering, the seat adjustment feature is an important aspect for safety and ergonomics. There could be a basic adjustment with a lever, power operated or an auto programmed seat positioning and adjustment that has a memory feature for each driver that uses the vehicle.

With so many distractions and multi-tasking by drivers, a voice activated system is a welcome feature. This could be rudimentary... with reactive responses or a better interactive system that can guide you to adjust seat setting, steering, warning of fuel level, synchronise blue tooth feature with a phone/PDA, office and home. This again, is a wide canvass with a range that can affect consumer payout significantly.

Aesthetics are dictated by gaps and finishes between door panels, hood and in the trunk regiona tighter gap is better, posh looking but simple interiors, ergonomically designed comfortable seats, simple and elegant controls, quiet cabin, an invigorating engine, a seamless shifting efficient transmission, exotic lighting and an oomph stylingall this at an affordable cost. OEMs have to deliver to meet consumer aspirations and costs, if not, mind the gap.

The author is vice-president, technology and head of Eaton India Engineering Centre

http://www.financialexpress.com/news/mind-the-gap/529935/2

ALLIED INDUSTRIES

RUBBER PRICES TO FIRM UP ON SHORT SUPPLY, ROBUST DEMAND

Rajesh Ravi

The Financial Express

(Oct 19)

Kochi: Prices of rubber are likely to firm up further on short supply and robust demand, traders said. The cumulative drop in rubber supply during the period of April-September was 12%, while consumption is seen ahead by 3.5% over the same period of the previous year. India imported 1,14,000 tonne of the natural variety so far this year against 38,000 tonne in the corresponding period last year. While drought played havoc in the first part of the current fiscal, heavy rains disturbed production in September.

Availability continues to be tight and without further imports prices could rally to higher levels. Tyre manufacturers are likely to import a small quantity to keep the domestic prices under check, N Radhakrishnan, president, Cochin Rubber Merchants Association (CRMA), told FF.

India's natural rubber imports had crossed one lakh tonne during April-August of 2009-10 and according to the provisional data, imports touched 1,14,000 tonne by September. Rubber Board sources said that this is the first time that rubber imports crossed the 90,000-tonne mark. The maximum import prior to this year was in 2006-07 at 89,799 tonne.

Duty-free imports against the advance licence scheme is permitted for re-export and rules mandate that only 44 kg of natural rubber can be imported against 100 kg of exports. Duty-paid imports of natural rubber under open general licence attract an import duty of 20%. Import under the open general licence is viable only when the difference between the Indian and international prices are above Rs 25 per kg, traders said.

Prices are likely to improve globally on expectation that the world economy is on a recovery mode. Apart from the encouraging sign of economic activity in the world in general and China and India in particular, natural rubber (NR) prices also have benefited from the strengthening of crude petroleum prices. Tight supplies of raw rubber due to adverse weather pattern and disruption of tapping due to rains also offered some impetus to the price recovery in the second quarter of 2009.

Meanwhile, domestic consumption is robust and seen increasing rapidly with all sectors of the economy moving to positive territory. NR consumption increased from 8.61 lakh tonne in 2007-08 to 8.71 lakh tonne in 2008-09, an increase of 0.10 lakh tonne. The consumption growth in NR was lower than the production growth, which is on the expected lines given the decline in India's GDP. In India, NR accounts for a major share

in the total elastomer consumption in contrast to the global consumption patterns.

Production is likely to improve in the coming months (October-January), which are the peak production period for rubber. But it will still fall short of last year's production, board sources said. Natural rubber production during 2008-09 stood at 8.65 lakh tonne, an increase 0.40 lakh tonne in 2007-08.

http://www.financialexpress.com/news/rubber-prices-to-firm-up-on-short-supply-robust-demand/530267/2

FINANCE & INSURANCE

TVS-BANK OF INDIA TIE UP FOR CHEAPER AUTO LOAN

Business Standard

(Oct 17)

New Delhi/ Lucknow: Chennai-based two-wheeler major TVS Motor Company has tied up with Bank of India (BoI) to provide cheaper finance for aspiring customers in the ongoing festive season. Under the tie-up, BoI will provide one per cent rebate on auto loan for five years to TVS customers across all models till October 20.

The effective interest rate would be 8.5 per cent for our customers after rebate on reducing balance basis. The bank would be willing to finance 90 per cent of the on-road price of our models, TVS Motor regional manager Ajay Gupta said addressing the media here.

The scheme also has low processing fee of Rs 500 for loan amount below Rs 30,000 and Rs 700 for loan amount above Rs 30,000. This scheme is a value addition and provides our customers with excellent retail finance option this festival season. The total savings to a customer due to the low interest rate can be as high as Rs 12,000, he added.

http://www.business-standard.com/india/news/tvs-bankindia-tiefor-cheaper-auto-loan/373475/

OILS, LUBES & ALTERNATIVE FUELS

OIL UP TO YEAR HIGH ABOVE $78 ON DOLLAR, INVENTORIES

Reuters

See this story in: mint, The Indian Express
(Oct 17)

Singapore: Oil rose for a seventh session to a one-year high above $78 a barrel on Friday, after an unexpectedly steep drop in US oil product stocks and further weakness for the dollar.

Year highs for US stocks also helped oil power towards its best week of gains in nearly two months, even though investors were disappointed by results from top US banks Goldman Sachs and Citigroup.

The release of US September industrial production and capacity utilisation data, and a report on consumer sentiment for October, will offer more insight into the strength of the worlds largest economy and top oil user.

US crude for November delivery rose 48 cents to $78.06 a barrel by 0215 GMT, after settling $2.40 higher at $77.58 on Thursday. London Brent crude was up 40 cents at $76.63.

Oil is headed for a gain of 8.75% this week, and is its longest winning streak since July, but there are some worries about how long the rally can be sustained.

A correction is on the cards. I would expect profit taking to set in next week, and oil to retreat to the mid- to low-$70s, said Ben Westmore, commodities analyst with the National Australia Bank.

Fundamentals remain weak. Global inventories are still pretty high, and unless we see the supply overhang being worked off, an oil price in the high-$70s is really not justified.

Oils 3.2% gain on Thursday came after US Energy Information Administration data showed gasoline inventories fell by 5.2 million barrels last week, against analyst expectations for an increase. Distillate stockpiles also fell unexpectedly, while crude stocks rose 400,000 barrels, smaller than the forecast of a 700,000-barrel build.

Stronger US weekly jobless claims suggested the job market might be stabilising, which together with positive earnings results pushed the dollar to a 14-month low against the euro on Friday.

After results from JPMorgan and Goldman Sachs earlier this week, earnings from Bank of America and General Electric are due on Friday.

Industrial production and capacity utilisation data for September is expected to show a 0.2% rise in production, while the Reuters/University of Michigan Surveys of Consumers will release its October preliminary consumer sentiment index.

http://www.livemint.com/2009/10/16090732/Oil-up-to-year-high-above-78.html

http://www.indianexpress.com/news/govt-not-to-hike-oil-prices-despite-surge-in-global-rates/529910/#

INTERNATIONAL

AUTO INVESTORS LOOK BEYOND Q3 SCRAPPING BOOST

Reuters

See this story in: The Economic Times

(Oct 17)

Paris: As a boost from state-sponsored schemes to help consumers replace old vehicles with newer ones tapers off, investors will be looking at the auto sector's longer-term prospects when European carmakers and suppliers post third-quarter results in the coming weeks.

Governments around the world introduced so-called scrappage incentive schemes earlier this year to stimulate demand for new cars and help automakers who were badly hit by the global financial crisis, while at the same time removing environmentally-unfriendly vehicles from the roads.

Analysts do not expect a repeat of the good news on cash flow that was seen with first-half results in July, when production moved up a gear as the scrappage schemes kicked in.

Instead they will look for updates on cost-cutting and how companies plan to negotiate the end of the scrappage schemes in some markets.

"There'll probably be a much longer-term focus than at a normal set of quarterly results," said Credit Suisse analyst Stuart Pearson.

Companies have reduced their inventories and cut costs in the face of the economic downturn, and without the benefit of the scrappage stimuli, more pragmatic views on automakers' finances and prospects are likely to come into focus.

"Those big working capital moves are already behind us, and from here on in generating cash gets a bit tougher," said Pearson.

Nomura analyst Michael Tyndall agreed, noting that carmakers' predictions for the fourth quarter were likely to be positive. "However, uncertainty around 2010 remains, particularly for the volume makers who are likely to see a pay-back effect from scrapping incentives in terms of both sales and pricing."

In contrast, premium automakers may be more optimistic about a gradual recovery, he added.

Presentations by German carmakers, BMW Mercedes parent Daimler and Volkswagen, which also owns the Audi brand, take place towards the end of the month.

They are likely to be viewed through the prism of the end of that market's highly successful scrapping scheme in August.

http://economictimes.indiatimes.com/news/international-business/Auto-investors-look-beyond-Q3-scrapping-boost/articleshow/5131105.cms

VW EYES CASH CALL TO FUND PORSCHE

Reuters

See this story in: Business Standard

(Oct 17)

Volkswagen AG set out plans to raise as much as 10 billion euros ($14.9 billion) from shareholders, which analysts said would be enough to make fresh acquisitions as well as merge with Porsche.

Volkswagen, which has a market value of 43 billion euros, said on Friday it will seek clearance in December to issue up to 135 million new preferred shares by December 2014, a large portion of which could enter the market by the middle of next year.

News of the share issue plans, whose scale took some observers by surprise, followed comments by VW's powerful chairman last month hinting that Europe's largest automaker -- which had a global market share of 11.7 percent in September -- could expand its stable of brands to 12 from 9.

SKOREA BANK COLLECTS 108 MLN DLR REPAYMENT FROM GM SUBSIDIARY

AFP

See this story in: Hindustan Times
(Oct 18)

Seoul: A South Korean state bank on Friday collected $108 million in loan repayments from the struggling local unit of US auto giant General Motors as negotiations continued on a survival plan.

"Our bank is collecting some 125.8 billion won in maturing loans to GM Daewoo because there has been no request from the company to roll them over," a Korea Development Bank (KDB) spokesman said.

The move followed talks Wednesday between GM chief executive Fritz Henderson and top officials of KDB, the key creditor of GM Daewoo. It has a 28 percent stake in the local carmaker while GM holds 51 percent.

GM Daewoo, hit by falling demand amid the global downturn, is seeking a one trillion won (855 million dollar) loan after using up a two billion dollar credit line.

It also plans to raise 491.2 billion won in a rights offering this month to secure working capital. Henderson Thursday reiterated the US parent would take part in the rights offering.

KDB is demanding that GM increase the size of the rights offering, arguing that the US parent should raise more money for its subsidiary.

KDB chief Min Euoo-Sung last week urged the US company to offer part of its stake in the local unit as collateral. He also insisted GM Daewoo should be allowed to retain licences for cars that it develops itself. Newspapers said Friday that KDB also wants a say in management.

http://www.hindustantimes.com/News/auto/SKorea-bank-collects-108-mln-dlr-repayment-from-GM-subsidiary/Article1-465967.aspx#

GM SHOULD RECONSIDER EARLIER BIDS FOR OPEL: EU

Bloomberg

See this story in: Business Standard

(Oct 19)

Berlin: General Motors Co should be allowed to reconsider all bids for its Adam Opel GmbH unit after German aid policies pushed the US carmaker to choose Magna International Inc as the buyer, the European Union said.

Germanys offer of 4.5 billion euros ($6.9 billion) in state loans and guarantees for Opels sale must be available to all suitors to meet antitrust rules, the EU said on Friday in a statement outlining a letter that European Competition Commissioner Neelie Kroes sent to Economy Minister Karl Theodor zu Guttenberg. Authorities should inform GM and the trust that owns Opel that the aid is available to any buyer, the EU said.

Guttenberg said on Saturday that Germany will work to assuage EU concerns and that the sale is likely to proceed. Chancellor Angela Merkels government chose Magna, Canadas biggest auto-parts maker, and Russian partner OAO Sberbank as Opels preferred bidder in May, saying they wanted to preserve jobs. GM agreed in September to sell the unit to Magna, turning down a bid from Brussels-based investment company RHJ International SA.

If there are misunderstandings that need to be cleared up, we will do that, Guttenberg told reporters in Berlin. Im confident this will happen in the coming days. Answers will be given, and theyll be the right answers.

A preliminary EU inquiry showed significant indications that Germany improperly favored Aurora, Ontario-based Magna over other suitors for Opel, Kroes said in her letter. A precondition for the aid would be incompatible with EU rules that seek to limit state involvement in industries, she said. Karin Kirchner, a spokeswoman in Zurich for GMs European operations, declined to comment on Saturday.

Opel, which has its headquarters in the Frankfurt suburb of Ruesselsheim, received an initial 1.5 billion euros in emergency loans from Germany as Detroit-based GM sought Chapter 11 bankruptcy protection in the US in early June. A number of German politicians, including Roland Koch, prime minister of Opels home state of Hesse and a member of Merkels Christian Democratic Union party, said in May that they favoured Magna.

A trust of executives and politicians from Germany and the US now controls a 65 per cent stake in Opel, with GM owning the other 35 per cent. The trust chose Magna in September on GMs recommendation. RHJ had been the only other contender after GM negotiators and government aides agreed in July to stop looking at a bid from Beijing Automotive Industry Holding Co.

GM and the Opel trust should be given the opportunity to reconsider the outcome of the bidding process on the basis of firm written assurances by the German authorities that the aid would be available, irrespective of the choice of investor or plan, Kroes said.

RHJ, which agreed on October 15 to buy Commerzbank AGs Kleinwort Benson private-bank unit in the UK, isnt interested in reviving a bid for Opel, said Arnaud Denis, a spokesman. We are not considering it, Denis said. This isnt in the cards.

Edda Graf, a spokeswoman based at Magnas European headquarters in Oberwaltersdorf, Austria, declined to comment.

Other contenders for the Opel stake have found alternative automotive investments. Fiat SpA, Italys biggest manufacturer, was already buying a stake in Auburn Hills, Michigan-based Chrysler LLC when it submitted a non-cash offer for Opel that included factories and other assets from its own car operations.

http://www.business-standard.com/india/news/gm-should-reconsider-earlier-bids-for-opel-eu/373608/

4.5 billion euros in aid for Opel to a Magna takeover

Daily News & Analysis
http://www.dnaindia.com/money/report_4-5-billion-euros-in-aid-for-opel-to-a-magna-takeover_1300176

JAPANESE CAR MAKERS OUT TO ELECTRIFY TOKYO SHOW

AFP

See this story in: The Hindu Business Line

(Oct 19)

Move over hybrids -- the biggest buzz at this year's Tokyo Motor Show looks set to come from electric cars as the dream of affordable zero-emission vehicles moves closer to reality.

Japanese automakers, pioneers in hybrid cars powered by a mixture of petrol and electricity, are now looking to take fuel-efficient motoring to the next level with vehicles that run on rechargeable batteries.

Nissan will put its electric car, the Leaf, on display to the public for the first time at the Tokyo Motor Show, which kicks off on Wednesday with press previews and opens to general visitors on Saturday.

The mid-sized hatchback, which will go on sale in late 2010 in Japan, is billed by Nissan as "the world's first affordable, zero-emission car."

It can travel more than 160 kilometres (100 miles) on a single charge, at a top speed of 140 kilometres per hour.

The world's largest automaker Toyota, which has said it aims to launch an electric vehicle by 2012, will display a new version of its electric concept car -- the FT-EV II -- at the show.

"We think the time is almost ripe for cost levels, batteries and performance to evolve one step further," said Toyota's Akihiro Yanaka, who oversees the project.

Nissan will also show off a futuristic electric concept car that leans to the side when going around bends.

The "Land Glider," just 1.1 metres (3 feet 7 inches) wide, seats two people -- one in the front and one in the back. Inspired by motorbikes and glider aircraft, it has tilting wheels that enable it to lean by up to 17 degrees.

From Honda comes the EV-N, a cute new electric concept car that can store a one-wheel personal mobility device inside its door.

The dream of an electric car, which has been around since the time of Thomas Edison, has so far failed to break into the mainstream because of the high cost and limited battery life.

ECONOMY

FOREX RESERVES RISE BY $1.5 BILLION

The Hindu Business Line

(Oct 17)

Mumbai: The countrys foreign exchange reserves gained by $1.521 billion to touch $281.861 billion for the week ended October 9, according to the latest figures from the Reserve Bank of India.

This is the second week in a row that foreign exchange reserves have increased.

In the previous week ended September 25, reserves had increased by $430 billion to touch $280.340 billion. For the week under review, most of the gains have been on account of currency revaluation. Foreign currency assets increased by $1.477 billion to touch $265.942 billion.

Gold was unchanged at $10.316 billion. SDRs increased by $35 million to $5.235 billion. The reserve position in the IMF increased by $9 million to touch $1.368 billion.

Next week, the rupee could see resistance at 46.80 and could trade at around 46.40/50 levels, said a forex dealer with a pubic sector bank. The rupees movement will depend on the equities. A substantial correction in the equities is possible due to profit booking and a similar situation is also likely to be seen in the rupee, the dealer said.

http://www.thehindubusinessline.com/2009/10/17/stories/2009101751270600.htm

SENSEX ENDS FLAT AFTER AN HOUR OF DIWALI MAHURAT TRADING

The Economic Times

(Oct 18)

Mumbai: Indian equities ended Mahurat trading, first day of trade of Samvat 2066 (first day of Hindu calendar), on a flat note. Traders booked profits after indices hit new 52-week highs. However, the second rung stocks outperformed the benchmarks.

Markets opened higher on bullish sentiments following growth of Indian economy which was reflected in second quarter earnings.

After one hour of trade, Bombay Stock Exchanges Sensex closed at 17326.01, up 3.19 points or 0.02 per cent. The index hit a 52-wek high of 17493.17 and low of 17260.66.

National Stock Exchanges Nifty ended at 5141.80, down 0.35 points or 0.01 per cent. It touched a 12-month high of 5176.80 and low of 5140. BSE Midcap Index was up 0.65 per cent and BSE Smallcap Index gained 1.36 per cent.

Amongst the sectoral indices, BSE Metal Index jumped 0.65 per cent, BSE IT Index rose 0.39 per cent and BSE Auto Index moved 0.33 per cent higher. BSE Bankex was down 0.30 per cent and BSE FMCG Index slipped 0.09 per cent.

Sterlite Industries (2.89%), Reliance Communications (1.86 %), Bharti Airtel (1.74%), TCS (1.61%) and ACC (1.36%) were the top Sensex gainers.

Losers included ICICI Bank (-1.05%), HDFC Bank (-0.93%), Hindalco Industries (-0.70%), ITC (-0.65%) and BHEL (-0.65%).

Tata Consultancy Services bettered expectations to post a 29% jump in net profits for the second quarter. The company reported net profit of Rs 1,642 crore and revenues rose 7% to Rs 7,435 crore. Market breadth was positive on the BSE with 1930 advances and 582 declines.

Meanwhile, the US markets ended in the red. The Dow Jones Industrial Average closed 0.7 per cent lower, The S&P 500 Index slipped 0.8 per cent and the Nasdaq Composite Index declined 0.8 per cent.
Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved"

http://timesofindia.indiatimes.com/business/india-business/Sensex-ends-flat-after-an-hour-of-Diwali-Mahurat-trading/articleshow/5134812.cms

Indian Auto Industry News

Monday, October 19, 2009

Indian Auto Industry Update, October 19, 2009

INDUSTRY

CARs,SUVS & MUVs

No comments:

Post a Comment

Privacy policy

Followers

Blog Archive

Monday, October 19, 2009

Indian Auto Industry Update, October 19, 2009

INDUSTRY

CARs,SUVS & MUVs

No comments:

Post a Comment

Privacy policy

Subscribe To

Followers

Blog Archive