| INDIAN AUTOMOBILE INDUSTRY | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INDUSTRY CARS, SUVs, MUVs New Maruti MUV to hit roads by Oct Toyota Kirloskar posts reasonable profits in 2008-09 COMMERCIAL VEHICLES COMPONENTS | ALLIED INDUSTRIES Apollos Vredestein buy enhances global presence MRF United Workers Union demands recognition FINANCE & INSURANCE LUBRICANTS & ALTERNATIVE FUELS Oil stays above USD 61 per barrel INTERNATIONAL NEWS Lawmakers want Obama to slow down on GM, Chrysler GM bankruptcy likely next week: Report Steel faces longer term threat from use of aluminium in autos ECONOMY & FINANCE | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INTERVIEWS/FEATURES Go To Top Being a market leader during a slowdown can be tricky but not when you are Hero Honda. The motorcycle market leader has grown 13% in the last quarter three times the industry average. The company ended FY09 with 12% growth which boosted its topline by over 19%. Hero Honda managing director Pawan Kant Munjal discusses his strategy to defy the slowdown and focus on rural markets with ET. Excerpts : Which are the markets where Hero Honda needs to improve its footprint? We need to do much better in markets like Delhi and Punjab. http://economictimes.indiatimes.com/Opinion/Interviews/We-have-to-grow-beyond-2-wheelers/articleshow/4567618.cms?curpg=2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CARS, SUVs, MUVs Go To Top The Hindu (Web Edition) Kochi: Maruti Suzuki India Limited has unveiled Ritz in the Kerala market. The car is available both in petrol and diesel engine options and is positioned at the premium-end of the compact car market, said Amitava Roy, general manager of the company during the launch. The ex-showroom prices in Kochi are: LXi (petrol) Rs.3,89,863; Vxi (petrol) Rs.4,20,179; Zxi (petrol) Rs.4,81,913; LDi (diesel) Rs.4,65,500 and VDi (diesel) Rs.4,99,516, says a release. http://www.hindu.com/2009/05/23/stories/2009052357421700.htm NEW MARUTI MUV TO HIT ROADS BY OCT Suprotip Ghosh Hindustan Times (Web & Print Edition)
The new car, to be built on the Versa platform, is expected to strengthen the companys portfolio in the van segment. The price is yet to be decided. The new car, codenamed O2, is currently at an advanced stage of design and would be produced at Marutis plant near Delhi, according to sources. We do not share our product plans in advance. We announce the same at an appropriate time, a company response said. The new car is expected to bolster Marutis position in the combined people and luggage carrier segment. The segment grew to 10,708 in April 2009 from 8,816 in April 2008, according to the Society of Indian Automobile Manufacturers. The company launched the A-Star and the Ritz in the last few months, targeted at the urban driver. TOYOTA KIRLOSKAR POSTS REASONABLE PROFITS IN 2008-09 K. Giriprakash The Hindu Business Line (Web & Print Edition) Bangalore: The worlds largest car maker, Toyota may have suffered first time loss in over 70 years but its Indian arm has managed to post healthy profits in 2008-09, far better than its counterparts in Asia. An official with Toyota Kirloskar Motor Company told Business Line that for 2008-09, the car maker posted revenues of around Rs 3,760 crore which was about 11 per cent lower than the previous years revenues of Rs 4,103 crore. The revenue figures do not include excise duty. Though the company did not disclose the profit figures for 2008-09, the official said it has managed to post healthy profits though much lower than the previous years Rs 207 crore, which itself was about 95 per cent higher than 2006-07 net profit. We have posted reasonable profits during 2008-09, an official with the company said. The official said the Indian arm was hit by two major factors: exchange rate fluctuation and recession in the auto industry. Both these factors were not under our control but we managed to tide over the crisis because of the austerity drive in our company, he said. To arrest the slide, Toyota Kirloskar launched a series of austerity measures in 2008-09 which resulted in savings of between Rs 65 crore and Rs 70 crore. He pointed out that within a year, the rupee depreciated by about 20 per cent to Rs 50 a dollar while the recession in the auto industry hit all the car makers in the domestic market. The official said if sales improve during the next six months, Toyota Kirloskar will be able to perform much better. The company has in fact started increasing production during the last couple of months and now makes about 5,000 units a month. In December last year, Toyota Kirloskar had said that it would reduce production by 30 per cent because of the slump in auto sales. For 2008, Toyota Kirloskar sold 52,802 cars, which was about 2.5 per cent lower than the previous year. Compact car Meanwhile, the compact car project is going ahead as per schedule, the official said. He said the compact car will be launched towards the end of 2010 and there has been no delay in either building the factory, which is being set up near its existing plant, or in development of the compact car. India is also the only country where parent Toyota has not scrapped its new project. Toyota Kirloskar will invest about Rs 3,200 crore in its new car project. http://www.thehindubusinessline.com/2009/05/23/stories/2009052351030200.htm Rohin Nagrani Business Standard, Motoring Mumbai: The steering twitched. The dial hit the redline and as I shifted from 2nd to 3rd at about 105 kph, I was hit by a fair amount of torque steer. For once, I wished I had a paddle shift DSG rather than a six-speed manual, for I had to move my left hand to the gear lever for the upshift and that momentary release caused the Laura to move towards the left. The Laura? Torque steer? Doesnt it have one of the most balanced steering setups on a car in this country? But something was different here. I was behind the wheel of the facelifted Laura, and that too a petrol (yup!) the 1.8 TSI. And my friend Yuvraj was giving chase in his black Skoda Octavia RS. We were driving down a relatively empty piece of road, and I was trying hard to shake off the black RS from my rear view mirror. But the size of the speck stayed the same. So, the Laura was turning out to be quick, quick enough to keep an RS wedged to its tail, but not enough to leave the RS a couple of car lengths behind. This, despite the RS being 45 kg heavier and down by 12 bhp on the horsepower count. And to top it all, the RS is a full generation off on the Laura. So how come the old warhorse was giving the young cowboy a run for its money? Well, the Laura isnt your RS. In fact, if you look closer, it doesnt even look like the Laura you and I have been used to. Thats because this is the facelifted Laura, the one that carries forward the design language from the Superb on its nose. Somehow, though, it doesnt work here. The tight muscular lines of the Laura dont gel as well with the new organic front end as they do on the Superb. The resemblance between a goldfish in a fish bowl looking at you and the Lauras new front end is too strong. The eyelash headlamps with the new chrome grille somehow soften the sharp lines of the Laura and even the deeper front bumper and new fog lamps dont really make it stand out as a looker, especially in this new shade of green. The high-profile 15-inch tyres on the 5-spoke alloy wheels elevate the blandness with the tail providing some relief, thanks to the integration of the RS-style reflectors. The only way of distinguishing the standard facelifted Laura diesel and this is through the TSI badging on the boot. Once inside, you are greeted by new bits. The steering wheel is borrowed from the Superb, with an updated instrument cluster as well. New colours and digits apart, even the multi-function display looks new, adding some much needed colour to the otherwise drab Laura interiors. The biggest change is reserved for the centre console, where the all new stereo and controls as well as HVAC knobs and buttons have given the dashboard a feeling of newness. The upcoming 2.0 TDI, with the engine borrowed once again from the bigger Superb, will sport even more plush interiors and features, including a touch screen stereo, similar to the one on the bigger brother. There is a lot of beige on the inside of this TSI, to liven up the insides, though the material on the seats looks like it will need a lot of scrub and rub to keep it in top notch. Side bolstering on the front seats keep you nicely sunk in and raring to go. Sporty in accent, but not enough to wean you away from the RS. Where the imaginary RS co-passengers would have cribbed about sore ankles due to the lack of legroom in the rear seat, the ones in the Laura would have just continued with their conversations, as if nothing had happened. But right now, I was a little concerned with that black RS that refused to let go of my tail, like a radar guided missile. Then the road curvature started to increase and the air started to get thinner. And soon enough, the Laura started to distance itself from the RS, but not enough to completely disappear into the blue yonder. Yet it was getting apparent that the generation-up 1.8 TSI has some serious poke up its sleeve. With power and torque figures identical to the Superb, the lighter by nearly 200 kg Laura starts to show who is boss. While the additional horsepower over the RS is available from just 4500 rpm, vis-a-vis the RS 4700 rpm, the Laura slams the door on the face of its predecessor on the torque front with the full 25.4 kgm starting to sing at just 1500 rpm. This doesnt mean that the 21.3 kgm of torque on the RS is poor, but it just feels inadequate to keep the RS firmly hooked to the Lauras tail. This also shows when the peak 160 horses start to sing in a straight line, clutch be given a damn. With just 200 km on the clock of our mint fresh Laura test car, the acceleration numbers proved to be rather impressive. The tonne was dismissed in just 8.46 seconds, while the top speed went past the naughty side of 220 kph. Sounds like a repeat of the RS? Well, when we tested the RS a couple of year ago, it hit the tonne in 8.34 seconds and went on to hit 220 kph too. Passing speeds too sound similar, with the Laura just a tad quicker. Consider a Laura with more kilometres on the clock and an 8 second dash to 100 doesnt seem out of the reckoning. Unlike the RS sudden surge when the turbo starts to spool, the Laura shows little lag, though its still pretty perceptible. Combined with the six-speeders sharp shifting and lighter clutch and not to forget tuning that also makes the Laura more driveable, the RS finds itself with its credibility intact, but with less useable power on a regular basis than the Laura. Despite the power deficit, the RS still kept closing the gap as the road started to get even tighter. The use of 15-inch wheels and slightly less wide tyres made the Laura more susceptible to some understeer. Unlike the neutral and well-balanced mannerisms of the Laura 1.9 TDI, the 1.8 TSI with smaller rubber cant translate that around curves. Grip doesnt build as well and part- throttle tackling of bends just requires an extra bit of caution, despite the presence of ESP. The RS, shod with those 16-inchers and 205 section tyres, uses its power deficit to the maximum and gets the better of the Laura around a set of twisties. But the RS just cant provide the kind of ride comfort that the 15-inchers gift the Laura. More adept at thumping the road under its feet, the Laura just provides a much better ride, even though the setup is slightly stiff. This slightly stiff setting works fine on a well paved road with small bumps. Larger bumps tend to upset the wheels lateral motion and thumps start to sound like thuds. Somehow, Skoda havent managed to get the ride/handling bit sorted with the 15-inch setup, so we believe 16-inchers are the way to go, even if it means surrendering some of that thumpy ride. Eventually though, this Laura isnt an RS. Its not just the body kit or the handling setup that we are talking about. It boils down to the pants-on-fire experience. In a straight line, the Laura behaves just like the RS with its sharp throttle response and turbo surge, but take it down a nice challenging road and the Laura feels wanting. Wanting not so much for its lack of dynamic ability, but the lack of that edgy feeling that has made the RS develop such a cult following. Maybe the feeling comes from the fact that my first drive in the RS was at a very impressionable age, and at a time when anything sub 10-seconds to 100 was considered eye-poppingly quick, and there werent more than a handful of those around. Having driven cars that are way faster than the Laura, it still, somehow doesnt excite enough, despite very similar performance numbers to the RS. It just doesnt feel as raw as the RS, or even as feelsome. Neither does it come in the colours that excite your retinas a loud yellow or blood red as on the RS. And there is no body kit with gorgeous spider web wheels either. Nevertheless, the Laura is exciting, and its got an exciting price tag too, to fill in the gap left by the RS. At Rs 12.8 lakh, ex-showroom, Thane, its pretty good value. That means, if you dearly miss the RS, this is a good replacement, especially if you shift to larger tyres and wheels. But for the equivalent of Rs 13 lakh, you can also buy two used RS a tempting enough proposition. If getting chased by one wasnt enough, imagine the impact of two! http://www.business-standard.com/india/news/club-skoda/358900/ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| COMMERCIAL VEHICLES Go To Top | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CONSTRUCTION & AGRI MACHINERY Go To Top | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2/3 WHEELERS Go To Top Swaraj Baggonkar Business Standard Mumbai: Production of the 125 cc motorcycle has started in an assembly plant in China, putting the countrys second-largest maker a step ahead of competitor Hero Honda, which is also working on a motorcycle reportedly between the Rs 17,000 and Rs 20,000 price point. "We have started the production of a 125cc motorcycle which is branded 'Boxer' and not Bajaj in China. This motorcycle will also make its way to India later, said Rajiv Bajaj, managing director, Bajaj Auto. He declined to reveal the date of the launch. Bajaj Auto is not lending its own brand name for the low-cost offering because it does not want to dilute its brand image. The company is progressing to higher capacity motorcycles. Boxer is the the name of a motorcycle brand that Bajaj discontinued in 2004. Bajajs Chinese assembly plant will be ramped up to manufacture around 20,000 Boxers a year. About 14,000 of these will be exported to Nigeria, a 1.6 million a year low-cost motorcycle market. Bajaj is targeting a share of at least 40 per cent or 5.5 million units of the global market for low-cost motorcycles. The lowest priced motorcycle available in India is the Rock100, a 100cc offering made by a Kolkata-based IT company called Xenitis along with Guangzhou Motors of China, which is sold for Rs 25,000. Bajaj and Hero Honda sell motorcycles that start from over Rs 33,000. Bajaj's entry-level 100 cc motorcycle Platina is priced at Rs 35,000 and Hero Honda's cheapest model, the CD-Dawn, is priced at Rs 33,490 (both prices are ex-showroom, Mumbai) The move towards low-cost motorcycles by India's largest two-wheeler producers is perceived as a step towards addressing the first-time-buyer and defending the market against competition from Tata Motors cheap small car, the Nano. The primary target for such a motorcycle for both Hero Honda and Bajaj Auto will be the rural market, where the bicycle remains the main personal mode of transport. About 15 million bicycles are sold in India every year. http://www.business-standard.com/india/news/bajaj-low-cost-bike-pegged-at-rs-20-24k/358944/ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| COMPONENTS Go To Top T. Murrali The Hindu Business Line Chennai: Automotive and industrial filters manufacturer Mann and Hummel Filter Pvt Ltd, the wholly owned subsidiary of Mann + Hummel GmbH, is planning to set up its second facility in India, at an investment of Rs 100 crore. The Bangalore-headquartered company currently has a plant in Tumkur to make automotive filters, industrial filters and plastic components like intake manifold. Besides, it also makes coolant filtration systems for large industries and machinery for plastic process industry. Its customers include Ashok Leyland, Daimler, Ford India, Mahindra, Maruti, Tata Motors, Atlas Copco, Elgi Equipments, JCB and Ingersoll Rand. Mr Hans-Georg Hummel, Managing Director, Mann and Hummel Filter, told Business Line that the company has acquired 10 acres in Bawal in the Delhi-Jaipur highway, and construction will commence soon. Since inception, in India, in 2006, the company has invested Rs 82 crore. Now, it has earmarked about Rs 100 crore for setting up its second facility, commissioning a testing and validation centre, besides augmenting its R&D in Bangalore. Currently, the Tumkur facility has an annual capacity of one million plastic components, 20 million automotive filters and about a lakh industrial filters. The second plant planned in Bawal will make products only for the automotive industry, he said. The company recently commenced supply of thee-cylinder plastic intake manifold (having about 50 per cent of the weight of conventional aluminium intake manifold) for Marutis A Star. Currently, it is developing similar component for four cylinder engines, crank case ventilation system, air intake systems for heavy commercial vehicles, oil filter for cars and plastic housing for fuel filters. The company also sees huge potential for filters in the after-market, and hence, it is setting up its second plant, he said. The company reported a turnover of Rs 35 crore in 2007-08 against Rs 13 crore in 2006-07. http://www.thehindubusinessline.com/2009/05/23/stories/2009052351060200.htm | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ALLIED INDUSTRY Go To Top Chanchal Pal Chauhan The Economic Times See this story in: The Hindu Business Line New Delhi: Goodyear Tyres will enhance the production capacity of its Aurangabad plant by 15% to 40 lakh tyres per annum, a top company executive said without disclosing the investments for the project. http://www.thehindubusinessline.com/2009/05/23/stories/2009052351821700.htm APOLLOS VREDESTEIN BUY ENHANCES GLOBAL PRESENCE Pratim Ranjan Bose The Hindu Business Line Kolkata: When the Rs 5,000-crore Apollo Tyres shelved its proposed greenfield car tyre facility in Hungary last year, sensing a near repeat of Tata Nano episode in Bengal, little did it know that it was a blessing in disguise. Within months Amtel-Vredestein NV (AVNV) of Russia hit a financial crisis paving the way for Apollos acquisition of Vredestein Banden BV (VBBV), the Netherlands-based subsidiary of AVNV. The acquisition, which was completed early this week, came much cheaper than the 230-million (Rs 1,500 crore) investment estimated for the phase one of the Hungary project. The 307-million (approximately Rs 2,000 crore) VBBV manufactures high performance, high-speed designer passenger car tyres under the brand names of Vredestein and Maloya from its 5.5 million tyre capacity facility at Enschede and has established sales networks in Germany and other parts of the European Union. The acquisition fulfils Apollos dream to be a global player in passenger car tyre segment. While it has a robust presence in Indian market, acquisition of Dunlop South Africa a few years ago followed by the VBBV acquisition has left the company with four brands Apollo, Regal (Dunlop), Vredestein and Maloya in this segment with offerings varying from 12 to 24 wide tyres. Apart from sales in Africa, we are currently exporting Regal to European markets. Our product range increased with the latest acquisition. Soon after working out the integration plan of VBBV in the first week of June, we would start marketing Vredestein and Maloya in India, Mr Sunam Sarkar, Director and CFO of Apollo Tyres, told Business Line. While the landed price of VBBV products in India are yet to be worked out, Apollo said that with the population of high value cars increasing, there is a sizable market for such tyres in the country. Similarly, Apollo will manufacture some of its own brands at VBBVs facility for selling them in Europe. We are targeting to sell one million branded Apollo passenger car tyres in Europe in next two year by using the distribution network of VBBV, Mr Sarkar said. The acquisition of VBBV would also help Apollo consolidate its presence in the farm tyre segment. The long chase Apollo tried acquiring VBBV in 2005 but was outbid by Russian major Amtel. The company re-established contact with VBBV in 2008 when AVNV hit the financial air pocket. Though Mr Sarkar declined to disclose the acquisition cost, he said the total capex of the company during 2009-10 including investment towards the greenfield project at Chennai, investment in existing plants and the acquisition of VBBV was pegged at Rs 800 crore. The first phase of the Chennai facility, estimated to cost Rs 700 crore, is slated to be operational this year. http://www.thehindubusinessline.com/2009/05/23/stories/2009052350730300.htm MRF UNITED WORKERS UNION DEMANDS RECOGNITION The Hindu Business Line Chennai: The MRF United Workers Union, representing the workers at MRFs Arakkonam unit, is demanding management recognition and initiation of wage settlement discussions. Hundreds of workers from the unit and their family members gathered at the Labour Department office complex in Chennai to represent to the officials the demand to be recognised. Over the last two weeks workers at the Arakkonam unit have been agitating on this issue. The agitation which started as a sit-in strike ended with the management declaring a lock out and using police force to evict the workers on Wednesday. In an official statement on Thursday, the MRF management had said that the MRF United Workers Union was a rival union obstructing the actions of the management recognised MRF Arakkonam Workers Welfare Union. However, Mr V. Prakash, Honorary President of the MRF United Workers Union, said that it enjoyed the majority support of the workers. Following a representation to the International Labour Organisation, two enquiries held by the State Government had recognised that it represented the majority of the workers at the facility. Workers at the Puducherry unit were also on a sit in strike demanding management recognition, he said. Union office bearers who had gathered at the Labour Department premises said they were open to the idea of an election and secret ballot to demonstrate their majority representation. Their demand was simple, they said, the management should only recognise the union that represented the majority of the workers and the wage settlement should be signed with the majority union. As of now workers at Arakkonam were being paid on a piece rate basis which resulted in a huge loss to the employees. For instance, the average salary was around Rs 7,000 while MRFs own employees at Tiruvottriyur unit were paid basic and DA and the wages were more than double. The employees have been demanding recognition for the elected union since 1992, they said. http://www.thehindubusinessline.com/2009/05/23/stories/2009052350790300.htm http://in.biz.yahoo.com/090522/50/batmcc.html | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| FINANCE & INSURANCE Go To Top The Hindu Business Line Mumbai: Bajaj FinServ is looking to enter the construction equipment finance space by the year-end through its subsidiary, Bajaj Auto Finance. The company has been looking to broad base its business. Earlier, we were just financing Bajaj two-wheelers and consumer durables. We have diversified into business loans, loans against shares to high net worth individuals and loans against property. We also cross sell insurance products now. We are exploring the scope of construction finance business and will look to enter by the end of the year, said Mr Sanjiv Bajaj, Managing Director, Bajaj FinServ. The new business lines were introduced almost 15 months ago and revenues have started coming into the business, Mr Bajaj said. Pointing out the scale of funds handled by insurance companies from the Bajaj stable, Mr. Bajaj said that Bajaj Allianz Life Insurance and Bajaj Allianz General Insurance had investments aggregating Rs.17,000 crore and Rs 4,000 crore, respectively. Proprietary investments amounted to Rs 4,000 crore. Both the insurance companies are 74:26 joint ventures between Bajaj and Germany-based Allianz SE. Allianz would increase its stake to 49 per cent in the insurance ventures if the insurance Bill gets passed. We have given Allianz the option of increasing their stake as and when the law allows them to, Mr Bajaj said. Mr Bajaj said that there was no plan to list the insurance ventures. http://www.thehindubusinessline.com/2009/05/23/stories/2009052350700600.htm The Hindu Business Line New Delhi: Punjab National Bank (PNB) has signed a memorandum of understanding with Ashok Leyland to extend finance to the latters commercial vehicle customers. The MoU seeks to leverage PNBs extensive retail reach, especially in the Northern region, to cater to the financial requirements of Ashok Leylands customers. Mr Jagat Ram, General Manager (SME), PNB, signed the MoU on behalf of the bank. He said that financing of the vehicles (under the MoU) through the credit guarantee fund trust for micro and small enterprises would obviate the need for collateral security and third-party guarantee. http://www.thehindubusinessline.com/2009/05/23/stories/2009052350640600.htm | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| LUBRICANTS & ALTERNATIVE FUELS Go To Top PTI See this story in: Business Standard New Delhi: The government will consider deregulating petrol and diesel prices, as also increasing rates of natural gas sold by state firms, said Murli Deora, who is likely to start a second term as petroleum minister. Separate draft Cabinet notes are ready for giving public sector Indian Oil, Bharat Petroleum and Hindustan Petroleum freedom to fix petrol and diesel prices when crude oil prices are below $75 a barrel and raising rates of natural gas produced by Oil and Natural Gas Corp (ONGC) and Oil India Ltd from nominated fields. Deora, the outgoing petroleum minister, has been renominated to the Union Cabinet and is mostly likely to retain his ministry, breaking the jinx that no one oil minister has served a second term in the country. No one has ever completed a full five year term as petroleum minister and none have ever been repeated. BJPs Ram Naik is the longest serving oil minister, surviving at Shastri Bhavan for a good four-and-half years from end-1999. First, my portfolio has not been decided. Prime minister has not told me anything, Deora said before leaving for taking the oath. He, however, said issues of deregulation of petrol and diesel prices would very much be on agenda for the new government. We insulated the consumers when international crude oil prices touched $147 per barrel last year. Our attempt has been to make available fuel to common man at affordable price, Deora said. The fall in crude oil prices has, however, presented an opportunity to free the auto fuel prices that were brought under government control in 2004 after being free for almost two years. My personal opinion is that it is the right time to free petrol and diesel prices. But poor should continue to get cooking fuel like kerosene at subsidised rates, he said. Nowhere in the world is kerosene sold at Rs 9 per litre... It is cheaper than even mineral water. Deora, 72, has been instrumental in bringing about some structural reforms driving state firms to their core competence rather than diversifying businesses. He earned the wrath of reformists when he stonewalled attempts to allow skyrocketing oil prices to be passed on to consumers. The Draft Cabinet note on Decontrol of Price of Sensitive Products suggests a move to market-determined pricing when crude oil prices are below $75 a barrel. At these levels, state-run oil retailing firms would compete to fix consumer price. In the event crude oil crosses the $75 a barrel mark, the government would intervene in the market to lessen the burden on the common man through a sharing of the revenue losses of retailers between the national treasury and upstream oil and gas companies. Currently, the government controls on the prices of automobile and cooking fuels force state-run refiners to sell oil products below cost and the losses are partly borne by exploration companies. Also on agenda will be increasing price of gas that ONGC produces from fields given to it on nomination basis. ONGC currently gets about $2 per million British thermal unit while gas from fields operated by BG is sold at $5.70 per mmBtu. Also, explorers may get a seven-year tax break on income from gas produced at new fields to help boost investment. India had last month postponed its largest auction of exploration blocks on concerns that the lack of such a tax break would discourage domestic and overseas companies from bidding. http://www.business-standard.com/india/news/govt-to-consider-deregulating-fuel-prices-deora/358952/ OIL STAYS ABOVE USD 61 PER BARREL See this story in: The Indian Express US data on Thursday signaled that the road to recovery for the economy would be long and bumpy, after a key manufacturing index showed only marginally less weakness and unemployment looked set to hit double-digit levels. Sentiment was further pummeled by fears that the United States could lose its coveted triple-A credit rating. US crude for July delivery was up 40 cents at $61.45 a barrel by 0630 GMT, after falling 1.6 per cent to settle at $61.05 on Thursday. In post-settlement trade on Thursday, it hit a six-month high of $62.26, and is up about 9 per cent so far this week. London Brent was up 44 cents at $60.37. "I think the market has got ahead of itself -- we've talked about 'green shoots' of recovery in the economy, but the reality is that it's going to take time to get traction," said Peter McGuire, Managing Director of Commodity Warrants Australia. "Crude has risen about 85 per cent in the last three months, and it's not likely to go much further in this economic climate -- we're probably going to see a $55 to $65 range over the next couple of weeks," he added. The Philadelphia Fed's closely watched indicator of factory activity in the Mid-Atlantic region rose by a fraction in May, with contraction more than markets had expected. The US Labor Department also reported that initial jobless claims last week fell for the third time in four weeks, but continuing claims hit a 16th consecutive record high. The reports come a day after the Federal Reserve, in minutes released from its April policy meeting, said a full US recovery could take five or six years. Ratings agency Standard & Poor's warning that it could cut its top AAA credit rating on the UK also stoked worries the United States could face a similar fate. OPEC output seen steady US stocks saw a broad sell-off on Thursday, and the dollar hit a two-month low against the yen on Friday, as investors concerned about the US budget deficit, exited dollar-denominated assets. Oil has been on an upward trend since mid-April in an equity-led rally. Prices have recovered from below $33 in December after a plunge from record highs above $147 in July. It hit a six-month peak on Wednesday after weekly US government inventory data showed a steep drop in crude and gasoline stockpiles ahead of the US Memorial Day weekend, traditionally the start of the summer driving season. Some price support came from data showing China's apparent oil demand rose by 3.9 per cent in April from a year earlier, its first significant rise since October last year. Oil demand in China -- the world's second-largest energy consumer -- has fallen in four of the last five months, and by as much as 8.9 per cent in January. On the supply front, the Organization of Petroleum Exporting Countries, which has agreed to cut 4.2 million barrels per day of output since September to prop up prices, will meet again on May 28 to decide on supply. But the producer cartel is likely to keep output targets steady as stronger oil demand in coming months may cut brimming inventories, a senior Gulf OPEC delegate said. Eleven of 12 oil analysts and economists surveyed by Reuters also saw OPEC maintaining its output target. Unrest in OPEC member Nigeria, Africa's top oil and gas exporter, could underpin prices, although Minister of State for Petroleum Odein Ajumogobia said the country's oil output was still broadly unchanged at around 1.6 million barrels per day. http://www.indianexpress.com/news/oil-stays-above-usd-61-per-barrel/464357/3
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| GM MAY GET FOURTH BID FOR OPEL FROM CHINESE BIDDER Bloomberg See this story in: Business Standard New York: General Motors Corp may get a fourth offer for its Opel and Vauxhall operations in Europe after a Chinese carmaker submitted an expression of interest on Thursday, according to two people familiar with the matter. The Chinese company sent a letter a day after the May 20 deadline for bids, said the people, who declined to be identified because the negotiations are private. A specific offer may not materialise, said the people, declining to name the company. GM has said that Opel needs 3.3 billion ($4.6 billion) in state aid to survive. The carmaker is selling a majority stake in its European operations while preparing for a probable June 1 bankruptcy. The unit attracted bids from Italian carmaker Fiat SpA, Canadian auto supplier Magna International Inc. and RHJ International SA, a buyout firm with automotive assets, including former holdings of private-equity firm Ripplewood Holdings LLC. The risks are huge for a potential Chinese bidder, said Yu Bing, an analyst at Ping An Securities in Shanghai. Chinese carmakers arent big or experienced enough and lack the technology and management skills to buy something like Opel. Thomas Steg, a spokesman for Chancellor Angela Merkels government, told journalists in Berlin that he had no information on a potential offer from a Chinese bidder. The bids from Magna and RHJ include cash, while Fiats offer requires 7 billion of financing to reorganise Opel, the people said. Fiats bid has two parts: an offer for the Opel and Vauxhall units, and an alternative plan to also buy GMs operations in Brazil and Argentina, one of the people said. SAIC Motor Corp, Chinas biggest carmaker, declined to comment. Chongqing Changan Automobile Co Ltd spokesman Zhang Baojun said it had not submitted an expression of interest for Opel. Dongfeng Motor Group Co spokesman Hu Xindong and Geely Holding Group Co spokesman Zhang Xiaodong said they were unaware of any bid. Chery Automobile Co spokesman Jin Yibo was not available for comment. Roland Koch, the premier of the state of Hesse, where Opels headquarters are located, said in an interview on public-radio network Deutschlandfunk that Magnas offer is closest to the hopes and desires of many in German politics and among workers. Fiat Chief Executive Officer Sergio Marchionne has said he wants to create a new company that combines Fiats auto unit with Chrysler LLC, GM Europe and possibly GM Latin America. Intesa SanPaolo SpA, UniCredit SpA and Goldman, Sachs & Co. will be the global coordinators for the initial public offering of that automaker, Fiat said in a statement. The statement didnt specify whether the banks will provide financing needed to close the transaction. Gualberto Ranieri, a spokesman for Fiat in Turin, Italy, declined to comment. Marchionne has said his bid for Opel wouldnt require cash. He would offer 100 per cent of Fiats auto unit clean of debt and assume Opel debt, he said in a May 6 interview. GM Europe CEO Carl Peter Forster said last week that Magnas interest in Opel was to increase sales in Russia. Magnas focus on Russia would play on Opels growth in the country and help it accelerate, Forster said. Opel could leverage manufacturing in St Petersburg and in Uzbekistan with a Russian partner and Magna. RHJ gets more than two-thirds of revenue from sales of automotive parts. The company is led by CEO Leonhard Fischer, who joined in 2007 from Credit Suisse, where he was head of European operations. OAO GAZ, the carmaker controlled by billionaire Oleg Deripaska, said May 12 that it wants to start producing Opel cars in Russia with Magna if the Canadian parts maker acquires the GM brand. GM is trying to cut $1.2 billion in costs to secure Opels survival, and CEO Fritz Henderson said May 14 that he intends for any bidder to retain a technology-sharing relationship with the Detroit automaker. These are the kinds of cost-saving opportunities that GM really needs and they didnt have in the past, said Rebecca Lindland, a forecaster at IHS Global Insight Inc in Lexington, Massachusetts. Opel, maker of mid-sized Insignia sedan, will get 1.5 billion in bridge loans from German federal and state governments, according to Juergen Reinholz, economy minister of the state of Thuringia. The German government will contribute 750 million euros and the four states with Opel factories will provide the remainder, he said on Thursday. Opel also operates in the UK, Spain, Poland and Belgium. Arnaud Denis, a spokesman for RHJ, declined to comment. Renee Rashid Merem, a spokeswoman for GM in Detroit, Opel spokesman Frank Klaas, and Daniel Witzani, a spokesman for Magna in Europe, couldnt immediately be reached. Opel, identified by its lightning-bolt trademark, began as a manufacturer of sewing machines in 1862 and became a carmaker before GM bought it in 1929. http://www.business-standard.com/india/news/gm-may-get-fourth-bid-for-opelchinese- LAWMAKERS WANT OBAMA TO SLOW DOWN ON GM, CHRYSLER Agencies See this story in: The Economic Times, Hindustan Times Washington: Some members of Congress want the Obama administration to slow down the restructuring of General Motors Corp and Chrysler LLC, worried that the process could cost tens of thousands of jobs. http://economictimes.indiatimes.com/News/International-Business/Lawmakers-want- http://www.hindustantimes.com/StoryPage/StoryPage.aspx?sectionName=NLetter&id= GM BANKRUPTCY LIKELY NEXT WEEK: REPORT PTI See this story in: The Tribune, Daily News & Analysis, The Indian Express, The Times of India Washington: The US government is preparing to steer General Motors into bankruptcy as early as the end of next week, a plan which would provide billions of dollars more in federal funds to the ailing auto maker, says a media report. The Obama administration is preparing to send General Motors into bankruptcy as early as the end of next week under a plan that would give the automaker tens of billions of dollars more in public financing as the company seeks to shrink and reemerge as a global competitor, The Washington Post reported quoting sources familiar with the discussions. According to the daily, the move comes as the government is getting ready to lift another auto maker Chrysler from bankruptcy protection as soon as next week. Attributing to a source, The Washington Post said under the GM draft bankruptcy plan, the company would receive just short of $30 billion in additional federal loans. The publication noted that the figure is a starting point in negotiations between the government and the company and could change. A cash injection that large would boost the US investment in GM to nearly $45 billion. The timing of the filing is also fluid, and could happen the first week of June, it added. http://www.tribuneindia.com/2009/20090523/biz.htm#4 http://www.dnaindia.com/report.asp?newsid=1258064 http://www.indianexpress.com/news/gm-bankruptcy-likely-next-week-report/464389/ http://business.rediff.com/report/2009/may/22/bcrisis-gm-bankruptcy-likely-next-week.htm http://timesofindia.indiatimes.com/Business/GM-bankruptcy-likely-next-week/ STEEL FACES LONGER TERM THREAT FROM USE OF ALUMINIUM IN AUTOS Miyoung Kim / Reuters mint Seoul: A collapse in steel demand from the ailing auto sector may be foremost on steel makers minds at the moment, but rising government fuel standards are the greater cause for alarm as aluminium and magnesium steal market share. While the auto industry consumes only about 6% of the worlds crude steel production, mills have long counted on steady growth in car sales to generate new businessgrowth that may now be in doubt as aluminium and other light materials replace steel to help meet tougher environmental regulations. The threat became more apparent this week as US President Barack Obama introduced the most aggressive proposal yet to boost US auto fuel economy standards, which would encourage auto makers to invest in fuel-saving technology. Under the new standards, US passenger vehicles and light trucks must raise fuel efficiency by 5% yearly to an average 6.62 litres per 100km by 2016. The current law requires a similar gain by 2020. To achieve weight-saving and improve fuel efficiency, its inevitable to replace steel to lighter materials, as steel accounts for around 50-60% of total vehicle weight, said Han Do-suck, principal researcher of South Koreas Hyundai Motor Co.s materials research team. We are open to all possibilities and new technologies but any dramatic and immediate change is unlikely, mainly because of cost issues. The incentives are clear: fuel efficiency usually rises by 5-10% for every 10% reduction in vehicle weight, and per-vehicle steel consumption is well over 1 tonne. That can be a big blow to already reeling steel makers, such as Nippon Steel Corp., POSCO and AK Steel, which count auto firms as a big client and face reduced demand as auto output falls by as much as 20% this year. Already auto makers are increasingly stripping off sheets of steel in favour of lighter and more stylish materials, such as aluminium, magnesium, titanium, plastics and carbon fibre. The Mazda2 subcompact, for example, reduced weight by around 100kg from its predecessor by using lightweight and thinner tensile steel, altering the electrics, suspension and exhaust, and even by changing door speakers to save weight. The substitution has been led by aluminium, which can halve weight of vehicle body frames, thus dramatically reducing emissions of carbon dioxide blamed for global warming. A survey by research firm Ducker Worldwide showed that per-vehicle aluminium content in North America would rise to around 170kg by 2020, or 10.4% of total vehicle weight, from an estimated 8.6% this year. Aluminium, which is as stiff as steel but weighs one-third as much, has been developed for around two decades for use in autos but its high price and relatively complicated processing structure have prevented its use for the whole auto-body frame. Aluminium is some three-four times more expensive than steel per volume, and as a relatively less standardized and commoditized processing tool it costs a lot more to process the metal for auto use, said Kim Hyung-wook, a chief researcher at Korea Institute of Materials Science. Thats why the use of aluminium has been limited to premium auto models, where manufacturing and material costs are relatively minimal compared with total vehicle price. Audi AG, a unit of Volkswagen AG, has led the replacement and introduced all-aluminium body vehicles such as A8, but most carmakers have limited the use of the metal mainly to hood and trunk lid due to high prices. http://www.livemint.com/2009/05/21211222/Steel-faces-longer-term-threat.html BRITISH CAR OUTPUT SLUMPS 55%
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ECONOMY & FINANCE Go To Top The Hindu Business Line Mumbai: After a huge rise in the previous week, foreignexchange reserves for the week ended May 15, fell by $1.734 billion to touch $254.207 billion, according to the Reserve Bank of Indias Weekly Statistical Supplement. In the earlier week, forex reserves had increased by $4.239 billion to $255.941 billion. Revaluation In the week under consideration, the decline in forex reserves is on account of currency revaluation, said a forex dealer with a public sector bank. During this week, the euro hit a seven-week high of $1.3722 against the dollar. Foreign currency assets fell by $1.292 billion to touch $243.754 billion. Foreign currency assets expressed in US dollar terms include the effect of appreciation or depreciation of non-US currencies, such as yen, sterling and euro. Gold and SDRs were unchanged at $9.231 billion and $1 million, respectively. IMF reserves The countrys reserves position in the IMF increased by $13 million to $1.221 billion. Next week, the rupee will strengthen depending on the inflows, but the month-end dollar demand from importers and oil companies could arrest the rupees high gains, the dealer said. In case the rupee moves up too sharply, the RBI may intervene in order to protect exporters interests, the dealer added. http://www.thehindubusinessline.com/2009/05/23/stories/2009052350720600.htm
PTI See this story in: The Hindu Business Line Mumbai: Bouncing from its lows in early trade, the benchmark Sensex spurted by over 150 points to close the day on institutional buying in blue-chip stocks ahead of swearing-in of Prime Minister Mr Manmohan Singh for a second inning. On speculation that economic reforms will get a boost from the new UPA government led by Mr Singh, the bellwether index gained 150.61 points at 13,887.15. During intra-day it just missed the key 14,000-level at 1,3,936.93. The broader 50-share Nifty of the National Stock Exchange recovered by 27.60 points or 0.66 per cent to close at 4,238.50. Market men said institutional investors found an opportunity to buy into fundamentally strong stocks after their losses in the past two days. The stocks moved up were the ones which had seen a fall in the prices in the recent past. Reliance Industries, which had been falling since Tuesday, corrected. ICICI and L&T also corrected the recent fall in prices, said Mr Avinash Gupta, A ssistant Vice-President, Bonanza Portfolio. Buying picked up momentum after European bourses firmed up in early trade. Investors began to cover Nifty positions before expiry of derivatives series on May 28. Today's gains come after losing a hefty 565 points in the last two sessions after the historic jump by 17 per cent on Monday. http://www.thehindubusinessline.com/blnus/05221901.htm FISCAL CONSOLIDATION SHOULD BE BUDGET PRIORITY: RBI PTI See this story in: The Hindu Business Line Mumbai: The Reserve Bank of India (RBI) on Friday said the new UPA government, which is slated to present the Budget some time in July, should resist pressure for another stimulus as sustained economic recovery would require fiscal consolidation in mediu m term. Given the still soft economy, the pressure to provide more stimulus will persist. While this may help in the near term, the sustainability of recovery requires returning to responsible fiscal consolidation, Mr D Subbarao, Reserve Bank Governor, said. The fiscal stimulus packages and other measures initiated by the government to mitigate the impact of global financial crisis on the country have led to a sharp rise in expenditure and fiscal deficit, he said. The challenge for fiscal policy is to balance immediate support for the economy with a need to get back on track on the medium-term fiscal consolidation process, Mr Subbarao told a seminar here. With every percentage point increase in the fiscal deficit, maintaining adequate liquidity in the system becomes that much more difficult, Mr Subbarao said. Managing this trade off between our short term compulsions and long term sustainability will be one of the big challenges, he said. http://www.thehindubusinessline.com/blnus/01221906.htm Last Financial closing
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
This message sent from Sundaram Clayton Ltd. may contain information (Including attachment) that is non-public, proprietary,privileged,confidential and intended only for the use of individual or entity to which it is addressed. If you are not the intended recipient and received this email by mistake,you are hereby otified that any use of this information, distribution,retransmission,dissemination
or copying is unlawful and strictly prohibited.You are advised to delete this email from your system immediately.
Posts
