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| HEADLINES Friday November 06, 2009 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INDUSTRY Auto stocks accelerate after better-than-expected Q2 results INTERVIEWS/FEATURES Smooth drive COMPONENTS ALLIED INDUSTRIES TN emerging tyre capital, big tyre companies line up projects in the State FINANCE & INSURANCE Honda Cars ties up with insurance cos OIL, LUBRICANTS & ALTERNATIVE FUELS Oil dips below $80/barrel | CARS, SUVs, MUVs Maruti mulls assembling SUV Grand Vitara in India by next year COMMERCIAL VEHICLES Eicher-branded vehicles Oct sales up 71 pc y/y VE Commercial Vehicles' October sales up 65% India comes closer to Harley experienceCONSTRUCTION & AGRI MACHINERY 2/3 WHEELERS Honda to launch 110cc bike with new style mantra INTERNATIONAL NEWS Raise taxes to boost fuel efficiency: Auto executives ECONOMY & FINANCE Rupee ends higher | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
 INDUSTRYThe Hindu Business Line (Web & Print Edition) Kolkata: Auto stocks are moving up after better-than-expected second quarter results. According to analysts, the market is cheering the growth in sales, new launches and improvement in margins. Analysts are also generally optimistic about the volume growth going forward. BSE Auto index gained 2 per cent and showed an improvement 4.38 per cent in the past week. The index, which included tyre and auto component stocks also, reflected an overall positive trend. Two-wheeler stocks such as Bajaj Auto (1.4 per cent) and Hero Honda (2.31 per cent) also closed up. On Thursday Ashok Leyland closed up 4.12 per cent after hitting its 52-week high, M&M gained 3.56 per cent, Maruti Suzuki rose 1.82 per cent and Tata Motors moved up 1.09 per cent. According to Mr Jinesh Gandhi of Motilal Oswal, the second quarter FY-10 results were better than the brokerages estimates, with highest ever margins. Volumes in grew 16.1 per cent for the industry, with recovery in commercial vehicles and strong growth in two-wheeler and personal vehicles. Further boost Numbers were further boosted by price hikes, full realisation of lower commodity prices and high operating leverage driving EBITDA margins to peak margins. In a note, the brokerage said the EBITDA margins expanded by 520 basis points Y-o-Y and 130 bp Q-o-Q to 15.5 per cent. It felt that increase in raw material cost owing to hardening in commodity prices, and negative operating leverage might impact margins in the second half of FY10. Though the monsoon blues have not hit the demand so far; along with hardening interest rate, it may affect demand in the second half of this fiscal. According to Angel Broking auto sales spurted in the past quarter owing to festive season buying. The commercial vehicle segment showed growth because of improving industrial outlook. Amid labour unrest in the Haryana Auto ancillary belt, the OEMs, particularly Hero Honda, managed to escape unscathed on the production front, Angel noted. Anand Rathi Finnacial Services said that for Tata Motors the key growth drivers were the CV segment (both LCVs and M&H CVs) and the Nano dispatches. M&Ms volume growth, however, came on the low base of the previous year. K. Venkiteswaran The Hindu (Web & Print Edition) Munnar: Tata Sons Chairman Ratan Tata has said that the low-priced Nano car would be localised for European markets and would be marketed after two years. He was talking to reporters at Munnar after participating in the silver jubilee celebrations of the High Range School run by Tata Tea. Regarding affordable housing project, Mr. Tata said the project was already on in Mumbai and the company was looking for projects in Bangalore, Kolkata and Assam. He said enquiries were also there from foreign countries and the Maldives Government had already signed an agreement to have an affordable housing project. About acquiring plantations overseas, R. K. Krishnakumar, Vice-Chairman, Tata group of companies, who was also present, said that the company had already had some plantations in Sri Lanka. It was looking for oil palm cultivation in Indonesia. The Kanan Deven group has been invited by the Ethiopian and Ugandan authorities for exploring the possibilities of setting up plantations there. To another query, Mr. Tata said the global economic downturn had impacted some of the global operations of the group, especially in the steel and automobile sectors. He said that the impact had been less in India though he was not in a position to say when the economy would be back on the rails. However, the phenomenon of sudden cancellation of orders were not felt in the internal markets and hoped that it would take two to three years for the economy to stabilise at the global level. Regarding manufacture of a global truck model, he said the Indonesian authorities had evinced interest and there was good market for export to the Middle East. These trucks are of high horse power and high speed which is much sought-after in the developing world. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Pallavi Pengonda Daily News & Analysis (Web Edition) Mumbai: Auto companies performed well in the September quarter, helped by the festive season and a decline in the cost of key raw materials such as steel and aluminium. Maruti Suzuki, India's largest passenger car company, posted numbers below expectations at the net profit level but in line at operational level. Revenues increased 44.2%, led by a 29.9% rise in sales volumes, higher exports and better realisations, which were helped by a change in product mix (including higher priced products). Operating margins expanded 239 basis points (100 basis points make a percentage point) to 12.7%, helped by lower raw material costs and other expenses. Net profit increased 94.6%. Mahindra & Mahindra posted better than expected financial results. Revenues increased 35.9%, driven by a 25.6% increase in sales volumes due to good growth in utility vehicles and a sharp increase in tractor sales. Operating profit margins increased 1233 basis points to 18.2% due to lower raw material costs and synergy benefits of merger with Punjab Tractors. Bajaj Auto's total operating revenues increased 14.6%, helped by a 7% increase in the company's total motorcycles sales and better price realisations. Volumes got a boost from upgrades of Pulsar and the newly launched Discover DTS-Si. Operating margins improved 839 basis points to 22.04%, thanks to stable raw material costs. The positioning of Discover and Pulsar as lead brands in the premium segment has augured well for Bajaj Auto. Premium segment bikes enjoy higher margins compared with the executive segment. Strong operating performance and nil interest expense helped net profit more than double (up 118%). Hero Honda's net profit performance was better than expectations. Net profit increased 95%, helped by a lower rate of increase in tax outgo (up 19%), given a 100% exemption on production from the company's Haridwar plant. Total operating revenues increased 26.7%, led by a 21.7% increase in sales volumes and higher price realisations. Operating margins improved 475 basis points to 18.33%, mainly because raw material costs as a percentage of revenues declined 432 basis points. Shobhana Subramanian Business Standard (The Compass) Mumbai: The company has done well to gain market share and should cash in on the recovering economy. The revival in the domestic commercial vehicles (CV) market has helped truck and bus maker Ashok Leyland (AL) take a couple of price increases in the last few months. Indeed, with volumes increasing by 87 per cent sequentially during the September 2009 quarter compared with the June 2009 quarter, the worst is clearly over for the Chennai-based firm. The management believes volumes could probably grow by about 15 per cent whereas earlier it was talking of only single-digit growth. AL was also able to pick up 5-10 per cent of the market share and the company surprised the street with a slightly higher-than-expected top line performance net sales were down just 15.5 per cent year-on-year during the quarter at Rs 1,578 crore. However, the operating profit margin (OPM) came in a tad below estimates at 10.5 per cent, up 220 basis points year-on-year. An increase of about 8 per cent in the operating profit to Rs 166 crore. Also somewhat disappointing was the net profit of Rs 89.5 crore, up 36.6 per cent, though that had more to do with a higher-than-expected tax rate and lower-than-expected other income. With the economy recovering the outlook, CVs is now much better than it was three months ago, and AL should be able to cash in on the improving environment. The company already has orders for around 5000 buses under the JNNURM scheme and an additional 3,500 units from state transport undertakings. In 2010-11, AL is expected to turn in revenues of around Rs 8,300 crore and should the company be able to control costs and manage inventories, profits could increase to as much as Rs 400 crore. Of course, much would depend on how the company ends the current year and net profit estimates range anywhere between Rs 275 crore and Rs 350 crore. The AL stock currently trades at Rs 49, which implies a price-earnings multiple of 14 times for 2010-11 estimated earnings, if profits come in at the higher end of the range.That, analysts believe, is expensive. The Economic Times, Editorial In a turnaround economy like India, small can mean handsome returns. Ask auto makers Suzuki and Hyundai, focused on the sub-compact segment. It is thanks to buoyant small-car sales by their subsidiaries here that both Hyundai and Suzuki have posted record earnings growth, in the midst of a severe global downturn. It suggests a growth-driver role for the domestic automobile industry, and not merely in terms of volumes and sales. A whole gamut of innovations from green, energy technologies, to new materials and novel onboard computers seem likely to be increasingly commonplace in the automobile industry. So proactive policy for the latter would have beneficial effects and spillovers across a panoply of sectors as varied as energy systems, value-added plastics and information technology. It is true that a significant component of the recent spurt in small-car demand is due to pay revision in the government sector, reduction in excise duty and fuel-consumption subsidies. Besides, stepped-up small-car exports from India is also due to fiscal and monetary largesse in the mature markets. And these demand-side developments are a one-off boost, unlikely to be replicated. However, the fact remains that domestic demand for transport equipment would remain strong, given our huge growth potential. We need forward-looking policy to rev up production of value-added offerings that have high fuel efficiency, safety and smart systems. This does not mean, however, distortionary tax breaks and holidays. In an integrated value-added tax regime, exemptions would wreak havoc. Whats necessary instead is policy to upgrade industrial skills, encourage a web of supplier networks and provide for critical policy infrastructure, apart from motorable roads. Land acquisition for factories, SME finance, labour laws need urgent attention. Organised bus fleets that run according to GPS-monitored timetables should be the mainstay of urban public transport. The increasingly technology-intensive nature of auto manufacturing would raise productivity across the board. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Reuters See this story in: The Economic Times (Web Edition) New Delhi: VE Commercial Vehicles, the joint venture of Eicher Motors and Sweden's Volvo, on Thursday said Indian sales of Eicher-branded commercial vehicles rose 71 per cent in October. The firm sold 2,024 trucks and buses in the month, compared with 1,183 units in the year-ago period, it said in a statement. Exports went up an annual 26.6 per cent to 233 units, it said. Sales of such vehicles have been on an upswing in India with improving industrial activity and availability of easier credit. PTI See this story in: The Hindu Business Line (Web Edition) New Delhi: Auto maker VE Commercial Vehicles on Thursday reported 65.11 per cent growth in its total sales of Eicher trucks and buses in October at 2,257 units. The company had sold 1,367 units in the same month last year. Domestic sales increased by 71.09 per cent to 2,024 units, compared with 1,183 units in the same period a year ago, the company said in a statement. Exports for the month grew 26.63 per cent to 233 units compared to 184 units last year. Sales of light commercial vehicles in the Indian market during the month also went up by 77.97 per cent to 1,680 units, against 944 units in October, 2008. Heavy commercial vehicle sales also recorded a jump of 21.15 per cent at 126 units against 104 units in October last year, it added. VE Commercial Vehicles sales up Business Standard (Delhi Print Edition) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Murali Gopalan The Hindu Business Line Mumbai: Honda Motorcycle & Scooter Indias next offering in the market will be a 110cc motorcycle that will debut during this fiscal. Mr Shinji Aoyama, the President and Chief Executive Officer of HMSI, told Business Line that it would be a full-fledged bike at an attractive price. It is not going to be a commuter motorcycle just because it will be part of the 100cc plus segment. It will be sporty for sure but the direction in style is somewhat different, he said. This is precisely what HMSI did with its 125cc Stunner, which, in a rather short while, has carved a niche for itself in this category. The wholly-owned arm of Honda Motor Company has decided to focus on design and style aggressively which will also set it apart from its Indian sibling and market leader, Hero Honda. The new 110cc bike will operate in a segment that is part of the big numbers game in India with sales of over 3.5 lakh units each month. Hero Hondas Splendor and Passion models, on their own, take up over two lakh units with Bajaj Autos recently launched 100cc Discover doing around 80,000 units. HMSI has constantly reiterated that it would rather pay more attention to fun biking rather than basic commuting. The target audience will be the working youth and sources say the price could be in the region of Rs 45,000 (ex-showroom). This will be a bike with the typical Honda DNA and will have no problems clocking initial monthly numbers of 40,000 units, they add. The following fiscal (2010-11) will see more action on the bike front from HMSI. We may have a new motorcycle next year and less than two years from now there could be another big, exciting bike, Mr Aoyama said. And while he did not elaborate on the subject, indications are that the other bikes could be in the 150cc-200cc range or even higher. Clearly, there has been a complete shift in mindset as far as HMSIs bike strategy is concerned since the time it launched the 150cc Unicorn five years ago. There were no complaints on its performance then but what was missing was a style statement. While a section of the market was convinced the Unicorn would give the Bajaj Pulsar a run for its money, nothing of the kind happened and the latter only got stronger. The lesson was learnt and HMSI realised the way forward was to focus on sporty, stylish bikes while letting Hero Honda consolidate its leadership position in the commuter segment. The results are there to see with the Stunner and the company will now hope for an encore with the new 110cc motorcycle and the other bikes that follow. Labour Problem The recent labour problem at the HMSI plant threw production schedules out of gear especially in October where sales would have got a further shot-in-the-arm with the Diwali momentum. Mr Aoyama said output was down by nearly 60 per cent during the strike period but was confident that 100 per cent levels would resume from this month. We are confident of meeting the target of 1.25 million two-wheelers in 2009-10. We have already done our capacity expansion and can make-up for time lost between November and March, he added. The labour impasse was a trying period but, as he put it, we accept the reality and try to solve the problem peacefully and quickly. According to Mr Aoyama, HMSI would have to think of further expansion in capacity very soon though no detailed study had started yet. Within the next three years (when output will have crossed 1.5 million units), the company would definitely need a new home. It remains to be seen if it will opt to continue at Manesar or move to another auto belt like Haridwar or Pantnagar in Uttarakhand. Sumant Banerji Hindustan Times New Delhi: The countrys second largest manufacturer of two-wheelers, Bajaj Auto, is looking to ride to the global top spot by 2015. Honda Motor Corp of Japan is currently the worlds largest motorcycle manufacturer, with its joint venture company, Hero Honda, the market leader in India. Our aim over the next five years would surely be to try to become the largest motorcycle manufacturer in the world, said Rajiv Bajaj, managing director, Bajaj Auto. Currently Honda makes around 6-8 million motorcycles annually, while we produce around 3 million. Our mission is to specialise Bajaj as a motorcycle manufacturer. Every day we ask ourselves whether we can be the worlds largest motorcycle manufacturer. Bajaj also makes autorickshaws, in which it is already the global market leader. In the domestic market of approximately 6 million motorcycles annually, Hero Honda has a 60 per cent market-share and Bajaj a distant second with 20 per cent. Adding on Honda subsidiary Honda Motorcycles and Scooters Indias 6 per cent market-share, Bajajs target appears a distant dream. But he differs: Our target is very achievable but depends on whether we have good ideas and whether we can execute them well. Business Standard Chennai: Mahindra and Mahindra (M&M) plans to launch a motorcycle next year. The company is also looking at acquisitions in the electronic scooter space. To increase its penetration, the company is planning to tie-up with cooperatives and grameen banks. The auto major had entered the two-wheeler market market by acquiring the assets of Pune-based scooter manufacturer Kinetic Motor in 2008. Speaking to reporters after launching their new scooter brands, Rodeo and Duro, the vice-president, sales and customer care, Sanjiv Mittal, said the company was working on motorcycle models and the first one would be launched in 2010. The vehicle is in the developmental stage and the objective was to become a full-fledged two-wheeler player. Mittal said the companys Madhya Pradesh facility would be sufficient to meet the companys requirements. We just need some small investment to install some machines and the facility can produce up to 400,000 vehicles, he said. He added the company had sold around 7,000 scooters last month, of which Rodeo and Duro accounted for 5,600 units and Flyte accounted for the rest. He declined to comment on the sales target for 2009-10. The company is in the process of ramping up its two-wheeler distribution network by adding 50 more dealers. The company has 325 dealerships and plans to increase the network to 375 dealers by the end of this financial year, Mittal said. To increase penetration and to address any financial issues, the company planned to tie up with co-operatives and grameen banks for both finance and marketing. The company had already tied-up with five finance institutions, he said. Pankaj Doval The Economic Times New Delhi: Cult bike maker Royal Enfield is on the move. Banking on a blend of retro looks and new-generation engine technology, the company hopes to push volumes in India as it doubles investments. The company has set its sights on the nascent leisure biking segment in India, while going aggressive in the US and countries across Europe. Part of the Eicher group, the company is revamping its product portfolio with new age engine technology like electronic fuel-injection system. The company on Wednesday launched a new model in India the 500cc Classic that is designed around Royal Enfields J2, a model that shot to prominence in early 1950s. Blending yesteryears charm and todays technology , the Classic is a tribute to the glorious machines of the past and is ready to roar into the future, said Siddharth Lal, MD and CEO of Eicher Motors. Enfield India was formed in 1955 to make civilian and military models under licence from the original British manufacturer that unveiled the first Bullet in 1932. Bullet production in England ended in 1962, but Enfield India kept producing them and began exporting to Europe in the 1980s. The company hopes that with a new technology and a classic look, its appeal to the younger audience of the west will be stronger while also remaining an attractive option in the domestic market where demand has been growing for expensive bikes as Japanese and Indian players like Hero Honda, Bajaj and Yamaha introduce new machines. Lal, however, said Royal Enfield has no plans to pitch its bikes in competition with Japanese and Indian rivals, but rather rely on the appeal for the companys classic looks that give its bikes a cult status. The company has priced the 500cc Classic at Rs 1.24 lakh, while pricing a 350cc version at Rs 98,000 (ex-showroom Delhi). The company has been selling the 500cc Classic in European markets since October last year and has managed to export around 2,000 units, though it had to go for a preemptive checks on the deliveries after a mechanical glitch on a few of the units. Lal said the company plans to sell 50,000 units. While demand has been growing overseas, they are still at 5% of our overall sales. We expect this to go up to 15% of our sales in the coming years, he added. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved" The Pioneer New Delhi: Harley-Davidson, the iconic motorcycle brand from the US, is all set to rock India with its head turning product line up. Come 2010 and you can walk into any of Harley bike showrooms in some of the big cities and make your dream come true by owning it. Discussions are on to select dealers for our company in the five cities of India Delhi, Mumbai, Bangalore Hyderabad and in Punjab (either in Chandigarh or Ludhiana), said Harley Davidson India Managing Director Anoop Prakash in an exclusive talk with The Pioneer on Thursday. The process of selecting dealers will be complete in early 2010 and once that is complete, we will offer four range of products to customer, he added. The delivery of the Harley Davidson bikes will start in the new year and 2010 featured motorbikes are Sportster, Dyna, Softail, VRSC, Touring and CVO ranging from 888cc to 1584cc. India is growing at a fast pace and people have money and they aspire for leisure bikes. Harley Davidson will be offering them product line up in the range of Rs 7 lakh to 25 lakh, informed Prakash. Harley-Davidson Motor Company India is also in talks with banks for financing of its products. We are in talks with both private and PSU banks for financing of our products, said Praksh. But he didnt disclose further details saying he would so in an opportune time. Harley-Davidson appointed its national leadership team on Wednesday, which would be responsible for driving its sales, marketing and growth strategies in the country. The motorcycle manufacturer appointed Sanjay Tripathi as Director of Marketing, Rajiv Vohra as Director-Sales & Dealer Development, Yogesh Phogat as Director-Operations and Manish Agarwal as Director-Finance. They will report to Anoop Prakash. http://www.dailypioneer.com/213745/India-comes-closer-to-Harley-experience.html | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ALLIED INDUSTRIES TN EMERGING TYRE CAPITAL, BIG TYRE COMPANIES LINE UP PROJECTS IN THE STATE Hemamalini Venkatraman & V Balasubramanian The Economic Times Chennai: Going by the investments pouring into making automotive tyres, the wheel of fortune is set to swing the Tamil Nadu way. According to official estimates, a copious investment of nearly $ 1 Billion has already been pumped into the State by leading tyre companies. Apollo Tyres, ATC Tires, MRF, Dunlop and TVS Srichakra are some of those who have made big ticket investments, earning TN the tyre capital tag. The sector is also attracting more players. "We are gearing up for a fresh investment wave of Rs 5,600 crore in the tyre sector in the next 3-4 years," a top government official told ET, on condition of anonymity. Already, investments of Rs 4,400 crore are either in the partial completion or under implementation stage this year, the official said. Last week, the state cabinet at one stroke gave the formal nod to MNC, Michelins proposal to set up a Rs 4,000 crore greenfield project, near Chennai. It also cleared the proposal of Apollo Tyres to scale up investment at its upcoming radial tyre project at Oragadam from Rs 500 crore to Rs 2,100 crore. This apart, waiting in the wings to enter the State are the other MNC, Bridgestone and Indian major, J K Tyres. Industry sources said the tyre companies making a beeline is to be viewed in the context of Chennai having attracted almost all the global auto majors. If their car projects come through, Chennai would have an installed capacity of 1.28 million cars by the end of 2010. With the vehicle manufacturers keen on having more than one supplier, the tyre projects would mainly cater to the OEM demand. Later, the well developed port facilities in the State would encourage them to tap the export markets. The key raw material, rubber can be sourced from Kerala and Kanyakumari or imported. Bridgestone, which has sought 100 acres, is in advanced stages of negotiation to formalise its pact with TN. It is gleaned from a reliable industry source that it is looking at Thervaikandikai, near Gummidipoondi, in Kanchipuram district to set up its project. It is the same location where Michelin is putting up its project on 290 acres. That the state has alienated 1,122 acres in Thervaikandikai has been earlier confirmed to ET by Sipcot MD N Govindan. He had then said Michelin zeroed in on this particular site as it felt this to be the ideal location, given its proximity to the sea port and 40-km distance from the city. It is also learnt from multiple sources that J K Tyres has been scouting for 100 acres at Sriperumbadur in order to be close to the OEs in the bustling auto corridor. The project entails an investment of over Rs 1,000 crore. Madurai too is a possible location where the group company, Fenner (India) has its conveyor belt making plant. Recently, J K Tyre honcho H S Singhania confirmed that TN figured among the prospective locations for its expansion. Apollo Tyres is building a radial tyre unit on 120 acres at Oragadam. Expected to go on stream by year-end, it is now planning to scale up the capacity. Likewise, the off highway tyre project of ATC Tires at Sipcot Gangaikondan complex in Tirunelveli district too is nearing completion. The Warburg Pincus-funded ATC Tires has committed to invest Rs 300 crore in three years and another Rs 100 crore thereafter. MRF has planned to invest Rs 1,400 crore at Tiruvottiyur, Arakkonam besides the new project at Perambalur. Dunlop has also re-started its Ambattur plant in the city with plans to invest Rs 250 to Rs 300 crore. Madurai-based TVS Srichakra has also has lined up Rs 150 to Rs 200 crore investments for expansion. Another senior official ET spoke to, on condition of anonymity, said it makes sense for tyre manufacturers to be present in the auto hub. TN has the logistics advantage. "Servicing nearby countries due to port proximity makes it prudent for tyre companies to operate out of this geography," he added. Promotional agencies like the Tidco, Sipcot and Guidance Bureau, have been driving investments into TN. Since the sixties, TN has been the home of manufacturing. It is a "very good product and very easily marketable" to investors. Perhaps, this is the reason why global biggies find it easy to zero in on the multiple-advantaged location. According to a CMIE report, barring a few hiccups, capital investments in the auto ancillary industry are largely on track. Of the total 141 projects outstanding in the country, 34 are expected to be commissioned in the next one year ending June 2010. These would entail an investment of Rs 2,420 crore. Of these, 30 projects, valued at Rs 1,950 crore, will go on stream in 2009-10. Copyright 2009, Bennett, Coleman & Co. Ltd. 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| The Hindu Business Line New Delhi: Honda Siel Cars India (HSCI) announced on Thursday the launch of Honda Assure, an insurance tie-up with various general insurance companies. Under the initiative, Honda customers will get the benefit of a more transparent, hassle-free and quick turnaround time on their insurance claims. Other benefits include cashless insurance, clear demarcation of plastic and metal parts for greater transparency, instant policy issuance and an improved turnaround time. SMC Brokerage has been appointed as the exclusive broker. The insurance partners are National General Insurance, Bajaj Allianz, Royal Sundaram, Iffco Tokio and Universal Sompo. This programme is in line with our commitment to the customers towards enhancing ownership experience of their Honda cars, said Mr M. Takedagawa, President, HSCI. Insurance for Honda Siel cars | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Agencies See this story in: The Hindu Business Line Mumbai: Oil fell below $80 a barrel on Thursday, after a steep decline in US crude inventories sent prices up 1 per cent the previous day. US crude for December fell 61 cents to $79.79 a barrel by 0339 GMT, after settling up 80 cents on Wednesday. London Brent crude lost 59 cents to $78.30 a barrel. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Reuters See this story in: The Financial Express Detroit: Theres a simple way to get Americans to drive fuel-efficient cars, according to auto executives, but they are not going to like itsharply hike the gas tax. While politically unpalatable, gasoline that costs at least $4 a gallon would have a far greater effect on American fuel usage than Washingtons $25 billion loan programme meant to spark investment in new technologies, executives t said at Auto Summit in Detroit. Consumer demand for fuel-efficient cars like Toyota Motor Corps Prius and Ford Motor Cos Escape hybrid surged last summer as gasoline prices soared above $4 a gallon. But with the pressure offthe average US retail gas price was $2.66 a gallon at the end of October, according to the benchmark Lundberg survey Americans are once again buying fuel-hungry sport utility vehicles and other large cars. The US allows the price of gasoline to go back and forth across this line where the consumers dont care about fuel efficiency and where consumers do care about fuel efficiency,Mike Jackson, chief executive of AutoNation Inc, the number one US auto retailer, told the summit in Detroit on Wednesday. Gradually raising gas taxes to the point where fuel costs $4 to $5 at the pump will do more to stimulate demand in next-generation vehicles like General Motors Cos forthcoming Chevy Volt plug-in hybrid than any other policy initiatives, including raising the national fuel efficiency standards know as CAFE, Jackson said. Jerry York, a former GM board member and an adviser to billionaire investor Kirk Kerkorian, agreed. Unless gas is $3.50 or $4 a gallon, consumers are not going to want to buy those cars,York said on Monday. The obvious impediment to such a move is political. Higher fuel prices in the midst of a fragile economic recovery would likely be extremely unpopular even with consumers who favor greenissues and less dependence on foreign oil. See this story in: The Hindu Business Line London: New car sales in Britain rose an annual 31.6 per cent in October, their fourth consecutive rise, helped by a government incentive scheme, the Society of Motor Manufactures and Traders said on Thursday. The industry body said there were 168,942 cars sold last month. The government introduced a scrappage scheme earlier this year which gives drivers 2,000 to trade in cars more than 10 years old against a more fuel-efficient newer model. Detroit: Chrysler's new boss offered an ambitious outlook for the automaker on Wednesday, saying it would more than double sales, roll out a dozen new models built on Fiat platforms and pay back debt to U.S. taxpayers over the next five years. Fiat Chief Executive Sergio Marchionne said Chrysler would break even on an operating basis in 2010 and on a net basis by 2011. He said the automaker had built up its cash since it emerged from a fast-track bankruptcy funded by the Obama administration in June. The financial projections were the first Chrysler has offered since Marchionne took management control of the U.S. automaker and addressed concern about the financial toll of Chrysler's continued slide in U.S. sales. But Fiat's turnaround plan hinges on a range of upbeat assumptions: Chrysler will have to recover market share lost as it slid toward bankruptcy, the U.S. market needs to stage a gradual recovery and Fiat will need to find new overseas markets for Chrysler models led by its Jeep brand. Marchionne said the plan would push the limits of what Chrysler's engineers and dealers could deliver but said his experience spearheading Fiat's own turnaround five years ago showed it could be done. "Some of you are going to walk out of here skeptical, and some of you are going to be downright incredulous," said Marchionne, who was joined on stage by Chrysler's 24 top managers. "We have been here before." Marchionne unveiled a long-awaited turnaround plan at Chrysler's headquarters that ran for over eight hours and included references to topics ranging from Machiavelli to singer Bobby McFerrin to Fiat's engine technology. He said many analysts had misjudged how much Chrysler had been able to reduce its costs. "Most of you underestimated the substantial reduction in fixed costs that was carried out by the old Chrysler. The new Chrysler is being incredibly parsimonious." But the presentation did little to allay skeptics who say Chrysler could be short on time to steer its faltering operations toward recovery and rebuild interest among American consumers. See this story in: The Indian Express Tokyo: Toyota Motor Corp reported on Thursday a surprise quarterly profit and halved its annual loss forecast as both sales and cost cutting exceeded forecasts, putting it on track to follow its Japanese rivals into the black next year. The world's biggest automaker slashed its operating loss forecast to 350 billion yen ($3.9 billion) from 750 billion yen for the year to March, bringing the figure closer to an average projection of a 293 billion yen loss in a poll. Toyota revised its net loss forecast to 200 billion yen from a loss of 450 billion yen. For the July-September quarter, the maker of the Prius hybrid car reported an operating profit of 58.0 billion yen, a far cry from a profit of 169.5 billion yen a year earlier, but beating an average loss estimate of 63 billion yen from five analysts. Its net profit was 21.84 billion yen, against a 139.8 billion yen profit a year ago. Shares of Toyota lost 2.7 per cent in the three months to the end of September, underperforming the main Nikkei average, which rose 1.8 per cent. Toyota posts surprise profit, raises outlook Mint Toyota surprises with Q2 profit; halves loss outlook The Hindu Business Line Reuters See this story in: The Financial Express Tokyo: Toyota Motor Corps surprise quarterly profit and halving of its annual loss forecast failed to convince investors the worlds top carmaker is back on track, as government subsidies peter out and a strong yen takes its toll. Toyotas second-quarter net profit fell 84% to 21.84 billion yen ($242 million), while revenue dropped 24% to 4.54 trillion yen. Major Japanese automakers have raised their forecasts for the year to March 2010 as they squeeze out savings and government incentives from Germany to China, the US and Japan prop demand through the worst economic crisis in generations. But with such stimulus programmes beginning to run out, Toyota is looking to eliminate more spending, announcing its exit from Formula One racing on Wednesday to put that annual budget of around $300 million to better use. The biggest challenge for Toyota now is cutting overheads, said Koji Endo, a senior analyst at Advanced Research Japan in Tokyo. The company has not been able to respond to a sudden plunge in revenue with speedy cost reductions. Toyota, until two years ago the worlds most profitable automaker, is expecting the biggest loss among its domestic peers this year, weighed down by severe overcapacity after adding new factories during its boom years before the financial crisis hit. While Toyota said it expects an additional 350 billion yen ($3.9 billion) in emergency cost savings than what it had planned three months ago, investors were unimpressed by its revised outlook, especially after the consensus-beating forecasts from rivals Honda Motor Co and Nissan Motor Co. It seems too large, Koichi Ogawa, chief portfolio manager at Daiwa SB Investments. Toyota looks a little less attractive than other companies such as Honda and Nissan, he said, adding the market may find the news disappointing. Toyota shares ended down 0.8% before the results, having risen 23% this year. Nissan has more than doubled, while Honda is up by almost half over the same period. Toyota narrowed its annual net loss forecast to 200 billion yen from 450 billion yen, as it lifted its group-based global vehicle sales forecast by 6.5% to 7.03 million units. For the July-September quarter, the maker of the Prius hybrid car reported an operating profit of 58.0 billion yen, down 66% from a year earlier but beating an average estimate of a loss of 63 billion yen from five analysts. Toyota said the overshoot mainly came from improved used cars prices in the United States. Without such finance-related gains, it would have stayed in the red, an executive said. Struggling US rival Ford Motor Co also reported a quarterly profit this week, defying Wall Street estimates as it seized market share from General Motors Co and Chrysler. But the yens strength remains Toyotas Achilles heel as it exports more than half of its vehicles built in Japan. Theres not much we can do to battle the stronger yen apart from continuing with our cost reductions, executive vice-president Yukitoshi Funo told reporters. The second-quarter earnings mark a huge improvement from the previous quarters 194.9 billion yen loss, as Toyota gradually ramped up production in Japan, where demand for its Prius and other hybrid cars has shot up thanks to generous tax incentives. But with sales in the key US market still far below their peak, Toyota is aiming to boost manufacturing efficiencies to be able to break even using just 70% of its parent-only output capacity. Analysts expect capacity utilisation to improve as Toyota exits a 400,000 units-a-year factory in California that it had held jointly with GM. Tokyo: Toyota Motor Corp will spend hundreds of millions of dollars to build a research centre in China to develop vehicles for the fast growing market there, a newspaper said on Thursday. The world largest automaker will build a new centre with a full-scale test course near Shanghai, the Nikkei business daily said, adding contraction was likely to begin as early as next year. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ECONOMY The Hindu Business Line Mumbai: The rupee ended higher on Thursday. Dealers said the reason for this rise is the higher closing of the share markets. The rupee ended at 47.02/03 a dollar against the previous close of 47.05/06 a dollar. PTI See this story in: The Hindu Business Line Mumbai: A sudden spurt of buying towards the fag end of trading, sparked by the Government's decision to divest 10 per cent in all listed companies, pushed the benchmark Sensex up by more than 150 points to regain the 16,000-level after three days. Markets turned bearish in early trade after yesterday's rebound rally on weak cues from Asia and plunged to 15,564 points. Sentiment, however, turned bullish within minutes of Home Minister, Mr P Chidambaram announcing the Cabinet decision to divest 10 per cent stake in all listed companies. The Government also decided to list all profit-making public sector firms with a pos itive net-worth. After a roller-coaster ride, which saw the Sensex swinging over 500 points, the 30-share index finally closed the day at 16,063.90, netting a rise of 151.77 points or 0.95 per cent over its previous close. Small-cap and mid-cap stocks attracted brisk buy ing with their indices rising by 1.82 per cent and 2.02 per cent. Shares of the telecom companies were flavour of the day. Brokers said reports of government planning to reduce licence fee for telcos attracted heavy buying in these stocks. Sensex stocks Reliance Communications and Bharti Airtel posted impressive gains of 5.34 and 4.50 per cent respectively. The market is in a pull-back mode as it has witnessed vertical sell off in the earlier sessions. It is more of a bounce back kind of a trend. The long term uptrend is still intact and investors should put in money in the index stocks at every lows, sai d Kotak Securities Vice President Technical Research, Mr Shrikant Chouhan. The Hindu Business Line New Delhi: The annual Wholesale Price Index-based inflation in primary articles rose 8.94 per cent for the week ended October 24, up from the previous weeks yearly rise of 8.67 per cent, with the index for food items up 13.39 per cent during the latest reported week. The surge in food articles was led by potatoes, which recorded over 100 per cent year-on-year inflation, onions (50 per cent), pulses (24 per cent) and rice (12 per cent). Inflation in the fuel index dipped 6.2 per cent, the same as the week before, according to data released on Thursday by the Government under the new WPI series. In line with the decision of the Cabinet Committee on Economic Affairs (CCEA), the weekly releases of WPI will henceforth cover only the primary articles and commodities in the fuels group. The Commerce and Industry Ministry said it will release the October monthly data for all commodities on November 12. According to the latest data, the Primary Articles group index declined sequentially by 0.1 per cent to 273 points from 273.3 points for the previous week. The annual rate of inflation, calculated on point-to-point basis, stood at 8.94 per cent points for the latest week as compared to 8.67 per cent points for the previous week and 11.73 per cent during the corresponding week the previous year. Food group The index for the Food Articles group declined by 0.3 per cent due to lower sequential inflation in the case of items such as fish-marine (3 per cent), fruits and vegetables (2 per cent) and barley and jowar (1 per cent each). However, the prices of moong (3 per cent), wheat and bajra (2 per cent each) and condiments and spices and gram (1 per cent each) moved up. The index for the Non-Food Articles group rose by 0.2 per cent due to higher prices of raw silk (6 per cent), raw rubber (3 per cent) and castor seed, rape and mustard seed, raw cotton and copra (1 per cent each). However, the prices declined for raw wool (6 per cent) and linseed and groundnut seed (1 per cent each). Fuel group The Fuel, Power, Light and Lubricants index for this major group remained unchanged at its previous weeks level of 344.9 points. The annual rate of inflation, calculated on point-to-point basis, remained unchanged at its previous weeks level of (-) 6.2 per cent points for the latest reported week. Last Financial closing
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Sunday, December 13, 2009
Indian Auto Industry Update November 06, 2009
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