The Ministry of Railways' proposal for setting up two factories in Bihar, for manufacturing electric and diesel locomotives, has been approved by the Cabinet. To be set up in Madhepura and Marhowra (in the districts of Madhepura and Saran respectively) in Bihar, these factories will be a joint venture between the Ministry of Railways and an international manufacturer, who will also provide state-of-the-art railway locomotive technology.
The companies that are in the running for this joint venture project in Bihar are Alsiom (France), Bombardier (Germany) and Siemens (Germany) for the electric locomotives factory, and GE (India) and EMD (USA) for the diesel locomotives factory. The two factories will be set up with an estimated investment of about Rs 2,000 crore.
Over the next 10 years, the Ministry of Railways intends to source 800 electric and 1,000 diesel locomotives from these factories. The locomotives will be maintained by the joint venture company over the next 25 years.
Friday, February 6, 2009
VECV sales decline 58.27% in January 2009
A joint venture between Volvo and Eicher Motors, VE Commercial Vehicles (VECV) has reported a decline of 58.27% in the sales of its Eicher brand commercial vehicles in January 2009. The company sold 940 units in January 2009, compared to 2,253 units in January 2008. At 121 units in January 2009, exports were down 41.8%, while domestic sales, at 819 units, were down 60% compared to January 2008.
Thursday, February 5, 2009
Ashok Leyland, Nissan review plans, will scale back proposed investments
Ashok Leyland Ltd. and Nissan are reviewing their plans for the three joint ventures which they had agreed upon earlier, which would have entailed investments of about Rs 2,300 crore. These ALL-Nissan joint ventures were to be set up for the manufacture of LCVs, powertrains and technology R&D.
In keeping with the global economic downturn, ALL and Nissan wish to scale back their investments into the three JV companies. The two companies’ new plans will be finalised over the next few months, and the companies will do a complete rethink on what products they want to launch in the first phase.
In keeping with the global economic downturn, ALL and Nissan wish to scale back their investments into the three JV companies. The two companies’ new plans will be finalised over the next few months, and the companies will do a complete rethink on what products they want to launch in the first phase.
Tata Nano bookings open to soon, at Rs 70,000
By the end of this month, prospective buyers will be able to pay Rs 70,000 and book the much-anticipated Nano. Bookings will be accepted at Tata Motors dealerships as well as certain branches of the State Bank of India (SBI), with the latter also providing car loans for the Nano.
Tata Motors is looking at accepting bookings for up to 100,000 units of the Nano, by which it expects to rake in about Rs 700 crore over the next few weeks. Cars will be allotted via a draw, and most people who book a Nano can expect to wait for many months before their car is delivered. That is because while the Nano will be launched in March this year, the car will initially come from Tata Motors Pantnagar facility, which can only produce 3,000 cars per month.
However, things are expected to improve by early 2010, when the Nano’s main plant in Sanand will become operational. With a capacity of 250,000 cars per annum, the Sanand plant should certainly be able to satisfy the country wide demand for the Nano.
Tata Motors is looking at accepting bookings for up to 100,000 units of the Nano, by which it expects to rake in about Rs 700 crore over the next few weeks. Cars will be allotted via a draw, and most people who book a Nano can expect to wait for many months before their car is delivered. That is because while the Nano will be launched in March this year, the car will initially come from Tata Motors Pantnagar facility, which can only produce 3,000 cars per month.
However, things are expected to improve by early 2010, when the Nano’s main plant in Sanand will become operational. With a capacity of 250,000 cars per annum, the Sanand plant should certainly be able to satisfy the country wide demand for the Nano.
Ashok leyland sales down 73% in January 2009
Ashok Leyland Ltd. (ALL) has reported a 73% decline in its sales in January 2009, at 2,444 units, as compared to 9,112 units sold in January 2008. However, the company’s January sales were up 6% on the 2,307 units it sold in December 2008.
ALL produced 1,170 vehicles in January this year, compared to 960 units in December 2008. However, exports dropped to 418 vehicles in January this year, compared to 901 units in December 2008 and 635 units in January 2008.
During April 2008-January 2009 period, ALL’s total sales dropped to 46,087 units, compared to 65,110 units in the year-ago period.
ALL produced 1,170 vehicles in January this year, compared to 960 units in December 2008. However, exports dropped to 418 vehicles in January this year, compared to 901 units in December 2008 and 635 units in January 2008.
During April 2008-January 2009 period, ALL’s total sales dropped to 46,087 units, compared to 65,110 units in the year-ago period.
Tata Motors struggling to pay suppliers, Tata Sons increase shareholding in the company
Tata Motors, which seems to be going through a rough phase right now, owes more than Rs 1,200 crore in unpaid dues to its suppliers. This debt is said to have been accumulated over the last few months. With declining sales in the domestic market, interminable delays in the Nano project and financial troubles with Jaguar and Land Rover, things certainly don’t seem to be going too well for Tata Motors.
According to the company, Tata Motors is working with its vendors to try and find a way out the unpaid dues situation. On their part, some vendors and suppliers are said to be negotiating for part payment of their dues, which would at least allow them to meet their working capital requirements and to pay off the loans that some of them have taken from various banks.
Tata Motors, which posted a loss of Rs 263 crore for Q3 FY 2008-09, is negotiating with its suppliers for more time in which to make the pending payments. The company is also said to be speaking to banks, from which wants to raise the funds for making payments to its vendors.
In the meanwhile, Tata Motors’ promoters, Tata Sons have increased their stake holding in the company to 28.94%, up from the 21.91% it owned up till months back. With this, the total promoter shareholding in Tata Motors is now 41.78%.
According to the company, Tata Motors is working with its vendors to try and find a way out the unpaid dues situation. On their part, some vendors and suppliers are said to be negotiating for part payment of their dues, which would at least allow them to meet their working capital requirements and to pay off the loans that some of them have taken from various banks.
Tata Motors, which posted a loss of Rs 263 crore for Q3 FY 2008-09, is negotiating with its suppliers for more time in which to make the pending payments. The company is also said to be speaking to banks, from which wants to raise the funds for making payments to its vendors.
In the meanwhile, Tata Motors’ promoters, Tata Sons have increased their stake holding in the company to 28.94%, up from the 21.91% it owned up till months back. With this, the total promoter shareholding in Tata Motors is now 41.78%.
Tuesday, February 3, 2009
Yamaha to increase dealerships in India, looks at establishing exports hub in the country
After a decade of poor sales in India, Yamaha is currently witnessing a comeback of sorts in the country. With sales bolstered by the YZF R15 and FZ16, Yamaha India is now looking at expanding its dealer network and may even use its India facility as an exports hub for shipping bike and engines for its global operations.
Yamaha plans to invest up to Rs 240 crore in its India operations by 2011 and will develop at least two or more brand-new bikes which would engineered specifically for this market. The company is also looking at increasing the number of its dealerships in India to around 600, by end-2010.
Yamaha could also use India as its exports hub for bikes – as well bike engines – that it sends to Latin America, Nepal, Sri Lanka and South Africa. In fact, Yamaha could even be exporting bikes – probably the smaller capacity machines – from India to Japan as well as the US.
Yamaha plans to invest up to Rs 240 crore in its India operations by 2011 and will develop at least two or more brand-new bikes which would engineered specifically for this market. The company is also looking at increasing the number of its dealerships in India to around 600, by end-2010.
Yamaha could also use India as its exports hub for bikes – as well bike engines – that it sends to Latin America, Nepal, Sri Lanka and South Africa. In fact, Yamaha could even be exporting bikes – probably the smaller capacity machines – from India to Japan as well as the US.
Fitch Ratings: 2009 Auto components outlook
The outlook for the Indian auto component sector derives from Fitch Ratings’ outlook on domestic original equipment manufacturers (OEMs), as well as the agency’s outlook on the global automotive sector.
With substantial demand and margin pressures being faced by both Indian and international OEMs, the domestic auto component sector is also likely to face substantial operating pressures in calendar year 2009 (CY09). Component players will likely face demand pressures in line with their customers, although the impact on cash flows could likely be more severe in view of OEMs lengthening their payment periods.
Export-focused players are likely to face additional pressure from receivable risks on the back of the deteriorating credit profiles of the large international auto majors. The risks are accentuated by the relatively higher leverage amongst many players – a consequence of the additional debt taken on to finance their capex to meet the increasing capacities of OEMs.
Demand Pressures in Domestic and Export Markets
The demand outlook for the component sector remains negative, reflecting the ongoing pressures being faced on both the domestic and international scene. With the depressed scenario likely to continue over the short to medium term, and a softer recovery curve, the auto component sector is also likely to face significant demand pressures over the same timeframe. Many component manufacturers had anticipated some cushion from export demand, which they believed would be counter cyclical to the domestic cycles and result in better earnings stability.
However, the international markets have also faced severe pressure over end CY08, which will most likely extend over CY09 as well; and, as a result, Fitch does not expect any major positives on the demand front over the near term. Fitch notes that those players more focused on the commercial vehicle (CV) market are likely to be more severely impacted than those with more diversified product and customer profiles. Component manufacturers with a strong after-market component of sales could also be in a better position and be relatively less affected by the ongoing slowdown.
Whilst the recent decline in the Indian rupee/US dollar exchange rate will make Indian components cheaper for the international auto majors, Fitch does not believe that the impact will be sufficient to boost export demand. The positives could likely be offset by the ongoing decline in volume.
Margin Pressures on Low Capacity Utilisation
With most auto OEMs in India and abroad facing difficult markets, attempts are being made to mitigate the impact on their margins by demanding more price cuts from vendors. In addition, with lower capacity utilisation for the sector following production cut-backs at the OEMs, overheads are likely to remain high in relation to existing volumes. Many companies are also sitting on idle capacity built over CY08, in anticipation of export orders which have not materialised.
The higher fixed costs without commensurate volumes will likely have a further adverse impact on component makers’ operating margins. However, some relief from softer commodity prices could be expected over the short to medium term, once the higher cost inventories are liquidated. Fitch believes, however, that further price cuts beyond current levels (barring a pass through of commodity price benefits) would probably be limited, as many component makers have already given major price concessions in CY08.
Cash Flow and Liquidity Pressures from Working Capital
The OEMs are attempting to alleviate their own liquidity pressures by increasing their payable periods to auto component players. This has resulted in a significant increase in working capital requirements for most operators. In the case of exports, the risks are accentuated by the deteriorating financial profile of international majors such as General Motors Corp. (‘C’) and Ford Motor Company (‘CCC’), which has, in certain cases, limited the availability of export credit from banks.
Working capital has also increased due to high inventories – a consequence of the cut-backs in production at the major OEMs. This has put significant pressure on component makers’ short-term liquidity. These companies have increased utilisation of their working capital limits, and in some cases taken ad hoc limits from their bankers.
Capex and High Leverage Accentuate Financial Risks in the Near Term
The cash flows of most component makers are likely to come under pressure over CY09 in light of slower demand and higher working capital requirements. Much of the increased working capital requirements is also likely to be financed through debt, which will further increase leverage and lower interest cover ratios for many players. Many component players also have large term debt on their books, which was used to finance capex. Anticipating a substantial spurt in export orders, coupled with the expansions announced by domestic OEMs, component makers entered into large debt-led capex programmes.
A part of this capex was also required to meet the requirements of the new product launches scheduled by the OEMs. While some of the component manufacturers have deferred some of the expansion (in line with that of the OEMs), those which have already commissioned capacity have not achieved the targeted utilisation levels. In these cases, the repayments have started to fall due over CY09 and CY10, which exposes the companies to refinancing risks as current cash flows are not adequate to finance the repayments.
Credit Profiles to Remain Under Pressure over the Short to Medium Term
The profitability and financial profile of the auto component manufacturers are expected to worsen over the near term, in light of Fitch’s expectation of a subdued demand environment, and in line with its outlook for OEMs. Margins and credit metrics are also likely to remain under pressure. A soft recovery, lagging that of the OEMs, is anticipated only towards CY10. Exports are likely to remain subdued for longer, reflecting the agency’s expectation of a delayed recovery (only towards CY11) in most developing markets.
While Fitch has factored these short term pressures in its ratings and expects ratings to remain largely stable in CY09, downside risks do exist in the event demand slowdown remains more prolonged or deeper than presently anticipated.
With substantial demand and margin pressures being faced by both Indian and international OEMs, the domestic auto component sector is also likely to face substantial operating pressures in calendar year 2009 (CY09). Component players will likely face demand pressures in line with their customers, although the impact on cash flows could likely be more severe in view of OEMs lengthening their payment periods.
Export-focused players are likely to face additional pressure from receivable risks on the back of the deteriorating credit profiles of the large international auto majors. The risks are accentuated by the relatively higher leverage amongst many players – a consequence of the additional debt taken on to finance their capex to meet the increasing capacities of OEMs.
Demand Pressures in Domestic and Export Markets
The demand outlook for the component sector remains negative, reflecting the ongoing pressures being faced on both the domestic and international scene. With the depressed scenario likely to continue over the short to medium term, and a softer recovery curve, the auto component sector is also likely to face significant demand pressures over the same timeframe. Many component manufacturers had anticipated some cushion from export demand, which they believed would be counter cyclical to the domestic cycles and result in better earnings stability.
However, the international markets have also faced severe pressure over end CY08, which will most likely extend over CY09 as well; and, as a result, Fitch does not expect any major positives on the demand front over the near term. Fitch notes that those players more focused on the commercial vehicle (CV) market are likely to be more severely impacted than those with more diversified product and customer profiles. Component manufacturers with a strong after-market component of sales could also be in a better position and be relatively less affected by the ongoing slowdown.
Whilst the recent decline in the Indian rupee/US dollar exchange rate will make Indian components cheaper for the international auto majors, Fitch does not believe that the impact will be sufficient to boost export demand. The positives could likely be offset by the ongoing decline in volume.
Margin Pressures on Low Capacity Utilisation
With most auto OEMs in India and abroad facing difficult markets, attempts are being made to mitigate the impact on their margins by demanding more price cuts from vendors. In addition, with lower capacity utilisation for the sector following production cut-backs at the OEMs, overheads are likely to remain high in relation to existing volumes. Many companies are also sitting on idle capacity built over CY08, in anticipation of export orders which have not materialised.
The higher fixed costs without commensurate volumes will likely have a further adverse impact on component makers’ operating margins. However, some relief from softer commodity prices could be expected over the short to medium term, once the higher cost inventories are liquidated. Fitch believes, however, that further price cuts beyond current levels (barring a pass through of commodity price benefits) would probably be limited, as many component makers have already given major price concessions in CY08.
Cash Flow and Liquidity Pressures from Working Capital
The OEMs are attempting to alleviate their own liquidity pressures by increasing their payable periods to auto component players. This has resulted in a significant increase in working capital requirements for most operators. In the case of exports, the risks are accentuated by the deteriorating financial profile of international majors such as General Motors Corp. (‘C’) and Ford Motor Company (‘CCC’), which has, in certain cases, limited the availability of export credit from banks.
Working capital has also increased due to high inventories – a consequence of the cut-backs in production at the major OEMs. This has put significant pressure on component makers’ short-term liquidity. These companies have increased utilisation of their working capital limits, and in some cases taken ad hoc limits from their bankers.
Capex and High Leverage Accentuate Financial Risks in the Near Term
The cash flows of most component makers are likely to come under pressure over CY09 in light of slower demand and higher working capital requirements. Much of the increased working capital requirements is also likely to be financed through debt, which will further increase leverage and lower interest cover ratios for many players. Many component players also have large term debt on their books, which was used to finance capex. Anticipating a substantial spurt in export orders, coupled with the expansions announced by domestic OEMs, component makers entered into large debt-led capex programmes.
A part of this capex was also required to meet the requirements of the new product launches scheduled by the OEMs. While some of the component manufacturers have deferred some of the expansion (in line with that of the OEMs), those which have already commissioned capacity have not achieved the targeted utilisation levels. In these cases, the repayments have started to fall due over CY09 and CY10, which exposes the companies to refinancing risks as current cash flows are not adequate to finance the repayments.
Credit Profiles to Remain Under Pressure over the Short to Medium Term
The profitability and financial profile of the auto component manufacturers are expected to worsen over the near term, in light of Fitch’s expectation of a subdued demand environment, and in line with its outlook for OEMs. Margins and credit metrics are also likely to remain under pressure. A soft recovery, lagging that of the OEMs, is anticipated only towards CY10. Exports are likely to remain subdued for longer, reflecting the agency’s expectation of a delayed recovery (only towards CY11) in most developing markets.
While Fitch has factored these short term pressures in its ratings and expects ratings to remain largely stable in CY09, downside risks do exist in the event demand slowdown remains more prolonged or deeper than presently anticipated.
RECC building new plant near Bangalore, will increase capacity to 30,000 cars per annum
Reva Electric Car Company (RECC), Bangalore-based manufacturer of the Reva electric car, is now setting up a new assembly plant near Bangalore which will have a capacity of 30,000 units per annum. With the rise in the popularity of electric cars, RECC is committed to launching new models regularly and also hopes to increase its sales in the domestic market.
RECC’s new 18,212sq.m new production facility is being built in accordance with ‘green’ principles – the design is contemporary, energy requirements are low and the plant is being built to the ‘Leadership in Energy and Environmental Design’ (LEED) building rating system standard, an internationally accepted rating system and benchmark for evaluating and certifying sustainable sites.
Apart from looking at the Indian market, RECC is in the process of expanding its dealer network in Europe, South America and various parts of Asia. The Reva is already available in the UK, Ireland, Belgium, Spain, Cyprus, Greece, France and Norway, while distributors in Hungary and Slovenia have also been signed up recently.
A joint venture between the Maini Group of India and AEV LLC of California, and backed by lead US investors Global Environment Fund and Draper Fisher Jurveston, RECC has been making electric cars for the last five years – well before other, mainstream car manufacturers were taking EVs seriously. The company’s recently announced new car – the Reva L-ion – is slated to go into production by May this year, and will have a range of 120km and a six-hour charging time.
RECC’s new 18,212sq.m new production facility is being built in accordance with ‘green’ principles – the design is contemporary, energy requirements are low and the plant is being built to the ‘Leadership in Energy and Environmental Design’ (LEED) building rating system standard, an internationally accepted rating system and benchmark for evaluating and certifying sustainable sites.
Apart from looking at the Indian market, RECC is in the process of expanding its dealer network in Europe, South America and various parts of Asia. The Reva is already available in the UK, Ireland, Belgium, Spain, Cyprus, Greece, France and Norway, while distributors in Hungary and Slovenia have also been signed up recently.
A joint venture between the Maini Group of India and AEV LLC of California, and backed by lead US investors Global Environment Fund and Draper Fisher Jurveston, RECC has been making electric cars for the last five years – well before other, mainstream car manufacturers were taking EVs seriously. The company’s recently announced new car – the Reva L-ion – is slated to go into production by May this year, and will have a range of 120km and a six-hour charging time.
Monday, February 2, 2009
Green Baby: Hyundai planning all-new small car to take on Toyota iQ
Hyundai, the one non-Japanese Asian car manufacturer that’s fast catching up with the Japanese, is said to be planning an all-new small car which will take on the Toyota iQ. Codenamed ‘green baby,’ the new baby Hyundai will be, it’s rumoured, more basic and functional than the iQ.
The Hyundai Green Baby could either be powered by the i10’s 66bhp 1.2-litre inline-four Kappa engine, or perhaps an even smaller three-cylinder engine. The car, which is expected to go on sale in Korea, China, India and Europe, could be launched by mid-2010 and Hyundai is also expected to do a petrol-electric hybrid version of this car by 2011.
The Hyundai Green Baby could either be powered by the i10’s 66bhp 1.2-litre inline-four Kappa engine, or perhaps an even smaller three-cylinder engine. The car, which is expected to go on sale in Korea, China, India and Europe, could be launched by mid-2010 and Hyundai is also expected to do a petrol-electric hybrid version of this car by 2011.
M&M’s FES registers 7% decline in domestic sales in January 2009
Mahindra & Mahindra’s Farm Equipment Sector (FES) sold a total of 82,323 units during the April-January period this fiscal. This figure includes domestic sales as well as exports and represents a 1.75% decline over the 83,789 units sold in the April-January period in the last fiscal.
M&M’s cumulative tractor sales in the domestic market in April-January FY 2008-09 were 76,282 units, compared to 77,016 units sold in the April-January period in the last fiscal.
For the month of January 2009, M&M’s sales of tractors in the domestic market stood at 6,666 units as compared to 7,174 units for January last year – a decline of 7%.
Exports during January this year were 265 units, as against 879 units for the same period last year. Total sales (domestic + exports) for the month were 6,931 units, as compared to 8,053 units for the same period last year.
M&M’s cumulative tractor sales in the domestic market in April-January FY 2008-09 were 76,282 units, compared to 77,016 units sold in the April-January period in the last fiscal.
For the month of January 2009, M&M’s sales of tractors in the domestic market stood at 6,666 units as compared to 7,174 units for January last year – a decline of 7%.
Exports during January this year were 265 units, as against 879 units for the same period last year. Total sales (domestic + exports) for the month were 6,931 units, as compared to 8,053 units for the same period last year.
Production starts at the Tata Marcopolo plant at Dharwad
Tata Marcopolo Motors Ltd.’s bus manufacturing facility at Dharwad, in Karnataka, has started production. A 51:49 joint venture between Tata Motors and the Brazil-based Marcopolo, Tata Marcopolo Motors Ltd. has been set up at an investment of around Rs 200 crore. The Dharwad plant has started with an initial capacity of 15,000 units per annum, and this will be increased to 30,000 units per year in phases.
A wide range of buses will be produced at Tata Marcopolo’s plant, including the ‘Starbus’ and ‘Globus’ ranges. The plant will produce 16-54 seater standard buses, 18- and 45-seater luxury buses and low-floor city buses.
A wide range of buses will be produced at Tata Marcopolo’s plant, including the ‘Starbus’ and ‘Globus’ ranges. The plant will produce 16-54 seater standard buses, 18- and 45-seater luxury buses and low-floor city buses.
M&M sells 1,788 units of the Xylo within two weeks of its launch
Mahindra & Mahindra Ltd. (M&M) reports that it has sold 1,788 units of its new MPV, the Xylo, within just two weeks of its launch. The number of bookings received for the vehicle has crossed the 4,000 units mark, according to M&M.
The Xylo is the first all-Indian competitor to the very successful Toyota Innova, a facelifted version of which was launched almost immediately after the Xylo's launch. While the Chevrolet Tavera also exists in the same space, it’s a much older product and is nowhere near as high-tech or refined as either the Xylo or the Innova.
The Xylo is the first all-Indian competitor to the very successful Toyota Innova, a facelifted version of which was launched almost immediately after the Xylo's launch. While the Chevrolet Tavera also exists in the same space, it’s a much older product and is nowhere near as high-tech or refined as either the Xylo or the Innova.
Yamaha India registers 192% sales hike in January 2009
On the back of its two new bikes – the FZ16 and YZF R15 – India Yamaha Motor Ltd. registered sales growth of 192% during January 2009, at 18,320 units, as compared to 6,284 units in January 2008.
After years of producing dull, lacklustre products in India, Yamaha finally seems to be back on track in the country, and is committed to launching more new bikes that have been engineered specifically for the Indian market.
After years of producing dull, lacklustre products in India, Yamaha finally seems to be back on track in the country, and is committed to launching more new bikes that have been engineered specifically for the Indian market.
HMSI: Two-wheeler sales up 22% in January 2009
Honda Motorcycle & Scooter India Ltd. (HMSI) has reported a 22% increase in two-wheeler sales during January this year, at 94,982 units against 77,755 units in January last year.
HMSI’s motorcycle sales grew by 58% at 40,153 units, against 25,469 units in January 2008. Scooter sales during January 2009 also increased by 5%, at 54,829 units, against 52,286 units in January 2008.
HMSI’s motorcycle sales grew by 58% at 40,153 units, against 25,469 units in January 2008. Scooter sales during January 2009 also increased by 5%, at 54,829 units, against 52,286 units in January 2008.
Tata Motors sales get back on track in January 2009, company to bring JLR vehicles to India
The Jaguar XF sedan could be available in select Tata showrooms in India by the end of this year
Tata Motors’ domestic sales for the month of January 2009 were 35,704 units, the highest in the last three months. Domestic commercial vehicle sales at 17,373 units were the highest since October 2008, while domestic passenger vehicle sales at 18,331 units were the highest since May 2008. The company’s total sales (including exports) were 36,931 vehicles, also highest in the last three months.
However, while sales have climbed back compared with the previous few months, Tata Motors’ January 2009 domestic sales units were still 30% lower than that of January 2008. Cumulative sales (including exports) for the company were 400,260 units, about 13% lower than the corresponding period in the last fiscal.
Commercial Vehicles
Tata Motors’ sales of commercial vehicles in January 2009 in the domestic market were 17,373 units, higher than that in November 2008 and December 2008. However, this was still 43% lower than 30,530 vehicles sold in January last year.
M&HCV sales at 5,811 units were highest in the last three months, but 63% lower than January 2008. LCV sales at 11,562 units, was also highest in the last three months, but 22% lower than January 2008.
Cumulative sales of commercial vehicles in the domestic market for the fiscal were 212,552 units, a decline of 14% over 246,050 units last year. Cumulative M&HCV sales stood at 92,531 units, a decline of 28% over last year, while LCV sales for the fiscal were 120,021 units, a growth of 2% over last year.
Passenger Vehicles
The company’s sales of passenger vehicles in January 2009 in the domestic market at 18,331 units were the highest this fiscal since May 2008, 68% up over December 2008 but 9% lower than 20,119 vehicles sold in January last year.
The January 2009 sales maintain the upward trajectory in sales since August 2008 when the Indica Vista was launched, except for the seasonal dip in November and December. The Indica range sales at 11,433 units were the highest this fiscal, but 7.5% lower than January 2008.
The Indigo range sales of 3,973 units were 37% higher than January 2008. The Sumo and Safari accounted for sales of 2,925 units, 40% lower than January 2008 owing to disruption of supplies from a key vendor.
Cumulative sales of passenger vehicles in the domestic market for the fiscal were 157,415 units, a decline of 8% over 171,255 units in the same period last year. Cumulative sales of the Indica range at 86,260 units, reported a reducing decline of 23%. Cumulative sales of the Indigo family were 40,405 units, a growth of 76%. Cumulative sales of Sumo and Safari at 30,750 units declined by 14%.
Exports
The company's sales from exports at 1,227 vehicles in January 2009 declined by 70% compared to 4,147 vehicles in January 2008. The cumulative sales from exports for the fiscal at 30,293 units declined by 32% over 44,410 units in the same period last year.
Finally, Tata Motors is also in the process of finalising plans to bring Land Rover and Jaguar vehicles to the Indian market. Two vehicles which seem to be prime candidates for India are the Land Rover Freelander SUV and the Jaguar XF luxury sedan, both of which could come in either as CBUs or as CKD kits. In either case, JLR vehicles will belong in the premium luxury cars segment and will compete against brands like Mercedes-Benz, Audi, BMW, Volvo, Nissan and others.
SIAM pleads for government help
According to the Society of Indian Automobile Manufacturers (SIAM), investments of more than Rs 120,000 crore in the Indian automotive sector could be at risk and millions of jobs could be lost, if the Indian government doesn’t step in to help the auto sector.
According to SIAM Director General Dilip Chenoy, most of the auto industry’s problems remain unresolved despite the ‘stimulus packages’ provided by the Indian government. ‘If the downturn continues further and extends beyond the next three to four months, automobile companies have to cut production further and we are going to see pain,’ said Chenoy.
‘In case the economy does not revive, if we are unable to resolve the financing issue and if the government does not come to the help of the auto industry, you would have excess investment and capacity in the auto industry,’ he added.
The SIAM DG expressed serious concern about the Indian commercial vehicles sector, which has been hit especially hard by the economic downturn and is currently operating at around 10% capacity utilisation. However, he said there may be tremendous opportunity for India to emerge as a global player in the small cars space, since investments in that segment have already been made by various car companies.
Now whether the government really steps in to bail out the Indian automotive industry, and what steps it takes to do so, remains to be seen.
According to SIAM Director General Dilip Chenoy, most of the auto industry’s problems remain unresolved despite the ‘stimulus packages’ provided by the Indian government. ‘If the downturn continues further and extends beyond the next three to four months, automobile companies have to cut production further and we are going to see pain,’ said Chenoy.
‘In case the economy does not revive, if we are unable to resolve the financing issue and if the government does not come to the help of the auto industry, you would have excess investment and capacity in the auto industry,’ he added.
The SIAM DG expressed serious concern about the Indian commercial vehicles sector, which has been hit especially hard by the economic downturn and is currently operating at around 10% capacity utilisation. However, he said there may be tremendous opportunity for India to emerge as a global player in the small cars space, since investments in that segment have already been made by various car companies.
Now whether the government really steps in to bail out the Indian automotive industry, and what steps it takes to do so, remains to be seen.
M&M FY 2008-09 Q3 net profit down 99%
Mahindra and Mahindra (M&M) has announced that its stand-alone net profit for the third-quarter in FY 2008-09 declined by over 99%, to Rs 11.96 million, from Rs 4.05 billion in Q3, FY 2007-08.
M&M’s total income for Q3 decreased to Rs 25.62 billion, from Rs 29.8 billion in the year-ago period. According to the company, the poor performance is due to exchange losses to the tune of Rs 1.82 billion, high inflation of earlier months and the ongoing economic recession.
During the nine-month period ended 31st December 2008, M&M's net profits touched Rs 5.8 billion as against Rs 6.52 billion in the year-ago period.
M&M’s total income for Q3 decreased to Rs 25.62 billion, from Rs 29.8 billion in the year-ago period. According to the company, the poor performance is due to exchange losses to the tune of Rs 1.82 billion, high inflation of earlier months and the ongoing economic recession.
During the nine-month period ended 31st December 2008, M&M's net profits touched Rs 5.8 billion as against Rs 6.52 billion in the year-ago period.
Maruti: Sales up 5.4% in January 2009
Maruti Suzuki India Ltd. (MSI) has reported a 5.4% increase in sales in January 2009, at 71,779 units, as against 68,107 units in January 2008. The company’s domestic in January this year went up by 5.6%, to 67,005 units, compared to 63,459 units in January last year.
MSI’s exports in January 2009 went up to 4,774 units, from 4,648 units during Januray 2008 – an increase of 2.7%.
MSI’s exports in January 2009 went up to 4,774 units, from 4,648 units during Januray 2008 – an increase of 2.7%.
HMIL sales down 13.5% in January 2009, company signs MoU with Syndicate Bank
Hyundai Motor India Ltd. (HMIL) has reported a 13.5% decline in domestic sales in January 2009, at 21,016 units, as against 24,301 units in January 2008.
Overall (exports included), the company sold 35,096 units in the A2 segment (Santro, i10, Getz and i20), 2,057 units in the A3 segment (Accent, Verna), 62 units in the A5 segment (Sonata Transform) and one unit in the SUV segment (Tucson).
HMIL’s exports totalled 16,200 units in January this year, as against 13,399 units in the year-ago period, an increase of 20.9%. ‘2009, as we had predicted, is going to be a very challenging year for the entire automotive industry. However, for HMIL, the launch of the i20 has been very positive and in the first month itself we have bookings of over 2,500 units for the domestic market,’ says Arvind Saxena, HMIL Senior Vice-President (Marketing and Sales).
HMIL has also signed an MoU with the Syndicate Bank, with which the company hopes to make for easier availability of car loans for Hyundai customers. ‘There is a need for increased financing options and rationalized interest rates for the benefit of our customers. Syndicate Bank, known for its initiatives with its competitive products and wide reach, is sure to broaden the choice for customers seeking finance options,’ says HMIL’s Saxena.
‘The two partners will utilize and leverage each other's extensive customer base to cross-sell Hyundai vehicles and the bank's car loans and schemes. The bank will provide very competitive interest rate and increased convenience to both our customers. The bank will also finance second-hand cars, which in itself has an increasingly growing demand,’ says George Joseph, CMD, Syndicate Bank.
Overall (exports included), the company sold 35,096 units in the A2 segment (Santro, i10, Getz and i20), 2,057 units in the A3 segment (Accent, Verna), 62 units in the A5 segment (Sonata Transform) and one unit in the SUV segment (Tucson).
HMIL’s exports totalled 16,200 units in January this year, as against 13,399 units in the year-ago period, an increase of 20.9%. ‘2009, as we had predicted, is going to be a very challenging year for the entire automotive industry. However, for HMIL, the launch of the i20 has been very positive and in the first month itself we have bookings of over 2,500 units for the domestic market,’ says Arvind Saxena, HMIL Senior Vice-President (Marketing and Sales).
HMIL has also signed an MoU with the Syndicate Bank, with which the company hopes to make for easier availability of car loans for Hyundai customers. ‘There is a need for increased financing options and rationalized interest rates for the benefit of our customers. Syndicate Bank, known for its initiatives with its competitive products and wide reach, is sure to broaden the choice for customers seeking finance options,’ says HMIL’s Saxena.
‘The two partners will utilize and leverage each other's extensive customer base to cross-sell Hyundai vehicles and the bank's car loans and schemes. The bank will provide very competitive interest rate and increased convenience to both our customers. The bank will also finance second-hand cars, which in itself has an increasingly growing demand,’ says George Joseph, CMD, Syndicate Bank.
Hero Honda hopes to grow in FY 2009-10 by focusing on rural markets
Despite the worldwide slowdown in motorcycle sales, Hero Honda expects its sales to continue growing in FY 2009-10. Hero Honda, which is 26% owned by Honda Motor Co., now plans to increase its focus on the rural market in India, which it aims to target aggressively with tailor-made advertising campaigns.
According to the company, the lack of consumer finance and the fact that banks have become very averse to taking any risks with giving out bike loans is one of the biggest problems the company is faced with. However, Hero Honda, which has consistently outperformed all other two-wheeler manufacturers in India in recent times, is hopeful it can still protect its margins and grow by focusing on rural and semi-urban markets.
According to the company, the lack of consumer finance and the fact that banks have become very averse to taking any risks with giving out bike loans is one of the biggest problems the company is faced with. However, Hero Honda, which has consistently outperformed all other two-wheeler manufacturers in India in recent times, is hopeful it can still protect its margins and grow by focusing on rural and semi-urban markets.
Bajaj: Two-wheeler sales down 34% January 2009
Bajaj Auto has reported a 34% decline in two-wheeler sales in January this year, at 110,363 units, against 167,592 units in January 2008. Bajaj’s motorcycle sales during the month also declined by 34%, to 109,666 units, compared with 166,492 units sold in January 2008.
The company’s three-wheeler sales in January this year stood at 21,985 units, as against 24,601 units in January last year – a decline of 11.9%. Exports during the month, however, grew by 24%, at 54,027 units in January 2009 as against 43,533 units in January 2008.
The company’s three-wheeler sales in January this year stood at 21,985 units, as against 24,601 units in January last year – a decline of 11.9%. Exports during the month, however, grew by 24%, at 54,027 units in January 2009 as against 43,533 units in January 2008.
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