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  • 8/3/2019 Automobile Industry Updates - July 2009

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    India

    Automobile Industry Updates

    In this issue:

    Regulatory Update

    Auto industry cheerscontinuation of CENVAT cut

    Automobile sectordisappointed

    Effects of Recession

    Mahindra Renault venture postsRs 490-cr loss

    M&M sees dip in automotive biz

    Worst is behind us, saysLeyland MD

    Michelin Posts Loss on SalesSlump, Restructuring Costs

    US auto bankruptcies hit Indianauto suppliers: Fitch

    Ratan Tata calls for cost cuts atJaguar Land Rover

    Press Release

    Tata Motors net up 58% on lowinput cost

    Mahindra Tractors sales rise51.92 pc in June

    M&M plans to roll out dieseltrucks in US

    Commercial vehicle market inIndia to rise

    Bank of Rajasthan ties up withMahindra & Mahindra

    Ashok Leyland, John Deerefloat equal stake venture

    Auto cos ride the green wave in

    Europe

    P K Ruia may step down fromboards of all group cos

    MRF blames militant group forunrest at Arakkonam plant

    ATMA expects Rs. 6,000 croreworth investments in Indiantyre making industry

    Automobile Industry Updates

    Issue No 5

    July 2009

    Regulatory Update

    Auto industry cheers continuation of CENVAT cut

    The Indian auto industry, which has been struggling hard to emerge from the sluggish

    market conditions, on Monday said that continuation of CENVAT cuts in the General

    Budget 2009-10 is a good step, but added that there could have been some

    incentives for exports.

    More

    Automobile sector disappointed

    The Union Budget 2009-10 on Monday failed to enthuse the slowdown-hit auto

    industry. Though some reduction in excise duty on large cars and utility vehicles has

    been announced, the industry leaders said a complete package was the need of the

    hour for the revival of the industry, particularly for passenger car and commercial

    vehicle segments. The industry has, however, welcomed continuation of CENVAT

    cuts that were announced in December last

    More

    Effects of Recession

    Mahindra Renault venture posts Rs 490-cr loss

    Following a 48 per cent fall in sales, Mahindra Renault Pvt Ltd has posted a loss of

    Rs 490.21 crore on a gross turnover of Rs 741.17 crore during 2008-09.

    The company, a 51:49 joint venture between Mahindra & Mahindra (M&M) and

    Renault, of France, makes the Logan entry-level sedan at M&Ms Nashik plant.

    More

    M&M sees dip in automotive biz

    Mahindra & Mahindra (M&M) sees a sharp decline in automotive and tractor business

    and expects pressure on margins to continue in the current fiscal year. The Mumbai-

    based tractor maker, which made large-scale acquisitions in the automotive space in

    the recent past, saw revenues from the automotive business plunge to Rs 100.85

    crore in FY09, from Rs 741.25 crore last year.

    More

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    Tyres made from trees cheaper,more fuel efficient: Research

    Bridgestone to expandproduction capacity

    Volvo cuts prices of sportsvehicle XC90 by Rs 4 lakh

    Car sales rise 5th month, newmodels help

    Fiat India to raise $510 mn loan

    Porsche plans to sell 50 unitsof Panamera this year

    Tata Motors to deliver firstNano on Friday

    Rural markets drive up carsales in June quarter

    New Product

    M&M rolls out micro-hybridBolero Maxitruck in Pune

    Mahindra looking for newlaunches for growth: KeshubMahindra

    Ashok Leyland launches newmultiaxle vehicle

    BMW likely to launch MiniHatchback in India by Dec 09

    Used Vehicles

    Shriram Transport Co to enterdebt market

    Industry Competition

    LCV segment bucks trend, sells48,374 units during April-June'09

    Proton looks to drive on toIndian auto track

    Auto makers continue uphilldrive in July

    Fiat, Tata eye market forFerraris in India: Report

    Ashok Leyland Nissan JV to

    rework manufacturing plans

    Pawan Ruia interested to buyout Tyre Corporation

    Vredestein: Marriage to ApolloWill Stand the Test of Time

    Apollo Tyres connects withtarget group

    Worst is behind us, says Leyland MD

    Ashok Leyland (ALL) reported a net profit of Rs 190 crore for the year ended March

    2009 compared with Rs 469 crore last year. Its headcount is 11,938 (13,304). The

    company declared 100% dividend and its sale revenue from vehicles, engines and

    spare parts during 2008-09 stood at Rs 6,666 crore (Rs 8,947 crore).

    More

    Michelin Posts Loss on Sales Slump, Restructuring Costs

    Michelin & Cie., the worlds second- largest tiremaker, reported a loss in the first half

    on a slump in sales to vehicle manufacturers and trucking companies hit by the global

    recession.

    More

    US auto bankruptcies hit Indian auto suppliers: Fitch

    The bankruptcies of leading American car makers Chrysler and General Motors

    coupled with depreciation of the rupee could adversely impact the prospects of the

    Indian auto suppliers, says a report.

    More

    Ratan Tata calls for cost cuts at Jaguar Land Rover

    Jaguar Land Rover (JLR), the marque brands acquired by Tata Motors from the Ford

    Motor Company in June 2008 needs cost reduction and reduction of development

    and productionising time as the global recessionary trends have seen a sharp fall in

    luxury vehicle sales.

    More

    Press Release

    Tata Motors net up 58% on low input cost

    Tata Motors posted better-than-expected quarterly earnings driven mainly by fall in

    raw material prices and the new accounting rules on forex differences. The company,

    India's largest vehicle manufacturer, said it saw signs of recovery for the business

    both within and outside India. In addition, the government's renewed thrust on

    infrastructure and tax cuts would aid growth in coming quarters. The Tata group

    flagship reported a 58% growth in net profit to Rs 514 crore in the first quarter ended

    June 30 as against Rs 326 crore in the previous corresponding quarter.

    More

    Mahindra Tractors sales rise 51.92 pc in June

    Farm equipment maker Mahindra Tractors today reported a 51.92 per cent rise in its

    total tractor sales in June at 18,242 units compared with 12,008 units in the same

    month last year.

    The domestic sales in last month grew by 61.13 per cent at 17,811 units against

    11,054 units in the year-ago period, the company said in a statement.

    More

    http://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Worst-is-behind-us-says-Leyland-MD/articleshow/4832192.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/US-auto-bankruptcies-hit-Indian-auto-suppliers-Fitch/articleshow/4759385.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Ratan-Tata-calls-for-cost-cuts-at-Jaguar-Land-Rover/articleshow/4835946.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Ratan-Tata-calls-for-cost-cuts-at-Jaguar-Land-Rover/articleshow/4835946.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/US-auto-bankruptcies-hit-Indian-auto-suppliers-Fitch/articleshow/4759385.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Worst-is-behind-us-says-Leyland-MD/articleshow/4832192.cms
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    Apollo Tyres gets a refreshedwebsite

    DuPont and Goodyear createhigh-tech tyres that Rock 'nRoll

    JK Tyre June quarter netdoubles at Rs 41 crore

    Apollo Tyres mulls Rs 1,000 crinvestment for IT park in Kerala

    Apollo Tyres sees 11 pc FY10

    sales growth

    Apollo Tyres targets 2-b outputby 2011

    Rolls Royce sees Indiaemerging as most importantMkt

    Escorts arm to market Chinesefirm's truck cranes

    Ford Honda cut car prices byup to Rs 6000

    International Updates

    Mahindra to enter US marketwith fuel-efficient pickup trucknews

    Electric cars poised to giveauto industry a jolt

    Bridgestone recalls another127,000 tyres

    Bridgestone to Build aRetreaded Tire Plant inThailand

    GM sales rise 38% in China

    China Car Sales Jump 48% onEconomic Stimulus, Most Since2006

    M&M plans to roll out diesel trucks in US

    Utility and tractor major Mahindra & Mahindra is stepping up plans to launch diesel-

    powered pick-up trucks in the US, even as global carmakers such as Honda, Toyota,

    Nissan and Ford have put similar pick-up launches in the US, on hold.

    More

    Commercial vehicle market in India to rise

    The commercial vehicles market in India is set to experience significant changes with

    the hub-and-spoke model of transportation, according to a recent report from Frost &

    Sullivan. The rising demand for specialized vehicles, due to the creation of the hub-

    and-spoke model is driving the commercial vehicles market in India, said Frost &

    Sullivan Industry analyst Sanjay Vasudevan.

    More

    Bank of Rajasthan ties up with Mahindra & Mahindra

    Bank of Rajasthan, one of the fastest growing, technology driven and customer

    friendly private sector bank, has announced tie-up by signing memorandum of

    understanding (MOU) with Mahindra & Mahindra one of the leading automobile &

    tractor manufacturer in India. This pact will help farmers in Rajasthan to obtain loan

    for tractors & farm equipments at a lower interest rate.

    More

    Ashok Leyland, John Deere float equal stake venture

    The countrys second largest truck maker Ashok Leyland and the US-headquartered

    John Deere Construction and Forestry Company Monday announced floating of a

    50:50 equal stake joint venture company to manufacture and market earthmoving

    equipments.

    More

    Auto cos ride the green wave in Europe

    Indian carmakers are reaping the benefits of the incentives offered by the

    governments of Germany, France and the UK to people exchanging their old cars for

    new fuel-efficient ones.

    More

    P K Ruia may step down from boards of all group cos

    Ruia group Chairman P K Ruia may step down from the board and allow the group

    companies to be managed by professionals, while he would remain group chairman.

    More

    MRF blames militant group for unrest at Arakkonam plant

    Indian tyre major, MRFs Arakkonam plant, re-opened on May 27, 2009 after a lock

    out, is still caught in the grip of labour unrest mainly due to the agitation by a section

    of workmen led by a splinter group.

    More

    http://blog.taragana.com/n/ashok-leyland-john-deere-float-equal-stake-venture-107978/http://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Auto-cos-ride-the-green-wave-in-Europe/articleshow/4750802.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Auto-cos-ride-the-green-wave-in-Europe/articleshow/4750802.cmshttp://blog.taragana.com/n/ashok-leyland-john-deere-float-equal-stake-venture-107978/
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    ATMA expects Rs. 6,000 crore worth investments in Indian tyre making industry

    Discerning the surging demand for truck and bus radial tyres, the Indian tyre making

    industry (which is into manufacturing radial tyres) could see investments worth Rs.

    6,000 crore in the next few years, thereby generating an extra capacity of 3.77 million

    units truck and bus radials, as predicted by Automotive Tyre Manufacturers

    Association.

    More

    Tyres made from trees cheaper, more fuel efficient: Research

    Automobile owners around the world in the near future might drive on tyres that are

    partly made out of trees - which could cost less perform better and save on fuel and

    energy.

    More

    Bridgestone to expand production capacity

    Bridgestone, the world's no. one tyre and rubber manufacturer, announced a

    production capacity expansion at its unit in Pithampur at Indore (Madhya Pradesh).

    The additional capacity facility will ramp up the production of tyres by 4,500 (units)

    per day.

    More

    Volvo cuts prices of sports vehicle XC90 by Rs 4 lakh

    Luxury car maker Volvo Car India on Thursday said it has cut the prices of its flagship

    sports utility vehicle XC90 by Rs 4 lakh to boost sales amidst the current economic

    downturn. The XC90 D5 will now come at Rs 42.5 lakh, while the XC90 32 and XC90

    V8 would be available for Rs 43.5 lakh and Rs 49.5 lakh, respectively.

    More

    Car sales rise 5th month, new models help

    Car Sales rose an annual 7.8 per cent in June, climbing for a fifth straight month and

    reinforcing the country was one of the few markets where demand has been picking

    up.

    A spate of new models and falling borrowing costs are luring new buyers back after a

    downturn in the middle of last year when high interest rates, lack of vehicle finance

    and a slowing economy squeezed demand.

    More

    Fiat India to raise $510 mn loan

    Fiat India Automobiles, a joint venture between Tata Motors and Fiat, is close to

    finalising a loan of $510 million about Rs 2,458 crore at current exchange rates

    for its capex and working capital programmes. The loans include a rupee term loan, a

    working capital loan and an export credit agency (ECA)-backed overseas loan,

    according to people close to the development.

    More

    http://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Volvo-cuts-prices-of-sports-vehicle-XC90-by-Rs-4-lakh/articleshow/4759090.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Volvo-cuts-prices-of-sports-vehicle-XC90-by-Rs-4-lakh/articleshow/4759090.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Car-sales-rise-5th-month-new-models-help/articleshow/4753374.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Fiat-India-to-raise-510-mn-loan/articleshow/4800742.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Fiat-India-to-raise-510-mn-loan/articleshow/4800742.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Car-sales-rise-5th-month-new-models-help/articleshow/4753374.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Volvo-cuts-prices-of-sports-vehicle-XC90-by-Rs-4-lakh/articleshow/4759090.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Volvo-cuts-prices-of-sports-vehicle-XC90-by-Rs-4-lakh/articleshow/4759090.cms
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    Porsche plans to sell 50 units of Panamera this year

    Despite the global economic meltdown, German car maker Porsche plans to sell 50

    units of its premium luxury sedan Panamera, which is to be launched by October, in

    India this year.

    More

    Tata Motors to deliver first Nano on Friday

    Tata Motors Ltd, India's largest vehicles maker, said on Thursday it would deliver the

    Nano, the world's cheapest car, to its first customer on Friday. Chairman Ratan Tata

    had showcased the Nano at an auto show in New Delhi in January last year, but

    consumer bookings began only in April this year after the project was delayed due to

    land disputes at its planned site in West Bengal.

    More

    Rural markets drive up car sales in June quarter

    Car sales grew 8.3% in June, aided by rising demand in semi-urban and rural

    markets, lower interest rates on auto loans and huge monsoon discounts offered by

    manufacturers. However, sale of commercial vehicles continued to decline, affected

    by a demand slump triggered by the economic downturn.

    More

    New Product

    M&M rolls out micro-hybrid Bolero Maxitruck in Pune

    Mahindra & Mahindra Ltd. (M&M), on 14th July09, has launched the Bolero Maxitruck

    with the micro hybrid technology, priced at Rs. 3.52 lakh (ex-showroom Pune).

    Mahindra has pioneered this eco-friendly and innovative technology in India and

    successfully implemented the same for use in vehicles such as the Bolero and the

    Scorpio.

    More

    Mahindra looking for new launches for growth: Keshub Mahindra

    Automobile major Mahindra & Mahindra is looking for new launches for growth,

    chairman of the company Keshub Mahindra said here on Thursday.

    More

    Ashok Leyland launches new multiaxle vehicle

    Hinduja Group flagship and leading commercial vehicle manufacturer Ashok Leyland

    today launched the 3116 multiaxle vehicle (MAV) developed for high fuel efficiency.

    Speaking to media persons after the launch here, Vinod K Dasari, Director and Chief

    Operating Officer, Ashok Leyland, explained that the 3116 is being launched to

    complement the company's successful 3121 8x2 MAV.

    More

    http://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Porsche-plans-to-sell-50-units-of-Panamera-this-year/articleshow/4824494.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Tata-Motors-to-deliver-first-Nano-on-Friday/articleshow/4785332.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Tata-Motors-to-deliver-first-Nano-on-Friday/articleshow/4785332.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Rural-markets-drive-up-car-sales-in-June-quarter/articleshow/4755114.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Rural-markets-drive-up-car-sales-in-June-quarter/articleshow/4755114.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Tata-Motors-to-deliver-first-Nano-on-Friday/articleshow/4785332.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Tata-Motors-to-deliver-first-Nano-on-Friday/articleshow/4785332.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Porsche-plans-to-sell-50-units-of-Panamera-this-year/articleshow/4824494.cms
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    BMW likely to launch Mini Hatchback in India by Dec 09

    German auto major BMW may once again look at the possibility of launching its Mini

    Hatchback in India by December 2009. The company recently raised the annual

    capacity of its Indian plant to 3,000 units from 1,700 on a single-shift basis at a cost of

    $750,000.

    More

    Used Vehicles

    Shriram Transport Co to enter debt market

    Shriram Transport Company (STFC), a non banking finance company (NBFC) plans

    to hit the debt capital market with issue of non convertible debenture(NCD)

    aggregating to Rs 1000 crore.

    More

    Industry Competition

    LCV segment bucks trend, sells 48,374 units during April-June'09

    There is good news for the light commercial vehicles of late. The industry has bucked

    the slowdown trend in the Indian commercial vehicle industry by posting a 17 per cent

    growth at 48,374 units during April-June09 period. Buoyed by this trend many tractor

    and CV makers like ICML, Bajaj Auto, Mahindra, Ashok Leyland, etc are chalking out

    robust strategies to either enter this segment or enhance its existing LCV portfolio.

    More

    Proton looks to drive on to Indian auto track

    Malaysian car maker Proton is keenly looking to enter the growing Indian automobile

    market to expand its overseas operations amid global demand slump.

    Proton has been trying to enter the lucrative Indian auto market for some years and

    the company was reportedly in talks with home-grown auto major Mahindra &

    Mahindra as well as contract manufacturer Argentum Motors.

    More

    Auto makers continue uphill drive in July

    Defying fears of a deficient monsoon affecting sales, major auto makers in the country

    registered a healthy growth rate in domestic sales in July, thereby continuing with the

    positive trend that began this year.

    More

    Fiat, Tata eye market for Ferraris in India: Report

    Italian auto giant Fiat and Indian car maker Tata are in talks about a joint marketing

    project to sell Ferraris and Mazeratis in India, news reports said on Thursday.

    More

    http://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/BMW-likely-to-launch-Mini-Hatchback-in-India-by-Dec-09/articleshow/4760116.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Fiat-Tata-eye-market-for-Ferraris-in-India-Report/articleshow/4812064.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Fiat-Tata-eye-market-for-Ferraris-in-India-Report/articleshow/4812064.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/BMW-likely-to-launch-Mini-Hatchback-in-India-by-Dec-09/articleshow/4760116.cms
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    Ashok Leyland Nissan JV to rework manufacturing plans

    In view of the current economic downturn and the reduction in demand for M&HCVs,

    the Hinduja Group-controlled Ashok Leyland has redrawn its capacity enhancement

    programmes to be in line with market outlook.

    More

    Pawan Ruia interested to buy out Tyre Corporation

    According to reports in the media, the Calcutta-based Ruia Group, owners of Dunlop

    India and Falcon Tyres, is negotiating for acquisition of the ailing Union Government

    undertaking, Tyre Corporation of India Limited (TCIL), which has a tyre manufacturing

    facility at Kankinada in West Bengal.

    More

    Vredestein: Marriage to Apollo Will Stand the Test of Time

    On May 15, Apollo Tyres purchase of Vredestein Banden was completed with the

    signing of contracts ratifying a deal estimated to be worth between 175 million and

    229 million euros.

    More

    Apollo Tyres connects with target group

    Apollo Tyres has launched a novel display in malls to connect with its target group.

    Apollo's new corporate identity was unveiled early this year. The idea was to remain

    in tune with the times and to reflect the company's young, vibrant and dynamic nature.

    More

    Apollo Tyres gets a refreshed website

    After rolling out its new corporate identity across operations in the first quarter of

    2009, Apollo tyres has now launched a refreshed website.

    More

    DuPont and Goodyear create high-tech tyres that Rock 'n Roll

    Goodyear and DuPont, among the world leaders in tyres and chemicals respectively,

    have come together to produce high-tech, ultra-tough tyres with Kevlar that might just

    be the next big leap forward in tyre technology.

    More

    JK Tyre June quarter net doubles at Rs 41 crore

    JK Tyre, on Thursday, reported double net profit at Rs 40.75 crore for the first quarter

    of the financial year as opposed to Rs 20.24 crore in the corresponding period a year

    ago, for the quarter ended June 30. Net sales for the April-June period increased by

    5.73 per cent Rs 897.67 crore against Rs 849.06 crore in the corresponding period a

    year ago.

    More

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    Apollo Tyres mulls Rs 1,000 cr investment for IT park in Kerala

    Apollo Tyres was planning to invest about Rs 1,000 crore for setting up an IT park

    and a hotel complex in Kerala, Apollo Group Chairman Onkar S Kanwar today said.

    More

    Apollo Tyres sees 11 pc FY10 sales growth

    Apollo Tyres expects an 11 per cent growth in domestic sales in 2009/10, helped by

    reviving demand from increased economic activity, and sees margins maintained at

    current levels, its finance chief said.

    More

    Apollo Tyres targets 2-b output by 2011

    With the commissioning of the tyre manufacturing unit of Apollo Tyres Ltd (ATL) at

    Chennai by December this year, the production of truck and passenger tyres of the

    company will be increased to 2 billion-mark by 2011.

    More

    Rolls Royce sees India emerging as most important Mkt

    Rolls Royce Motor Cars, the UK-based manufacturer of luxury automobiles, sees

    India emerging as its most important market in the next five to 10 years, and is

    looking at using parent BMWs supplier network in India to source components.

    More

    Escorts arm to market Chinese firm's truck cranes

    Escorts Construction Equipment Limited (ECEL), part of the Escorts Group, has

    signed an agreement with the Chinese Hunan Zoomlion International Trade Co Ltd for

    marketing the latter's truck cranes in India.

    More

    Ford Honda cut car prices by up to Rs 6000

    Car makers Ford India and Honda Siel Cars India on Tuesday cut the prices of some

    of their models by up to Rs 6,000 a piece to pass on the benefit of excise duty cut on

    large cars announced in the Budget.

    GM India, Toyota Kirloskar Motor and BMW had also said they would pass on the

    benefit of excise cuts to consumers.

    More

    International updates

    Mahindra to enter US market with fuel-efficient pickup truck news

    Mahindra & Mahindra is doing exactly what major Western automakers have failed to

    do - making fuel-efficient trucks. The Indian utility vehicles major seems to have taken

    over from Chrysler, Ford, GM and Toyota as the auto giants put off their small diesels

    in the wake of the second oil spike.

    More

    http://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Escorts-arm-to-market-Chinese-firms-truck-cranes-/articleshow/4773499.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Ford-Honda-cut-car-prices-by-up-to-Rs-6000/articleshow/4749984.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Ford-Honda-cut-car-prices-by-up-to-Rs-6000/articleshow/4749984.cmshttp://economictimes.indiatimes.com/News/News-By-Industry/Auto/Automobiles/Escorts-arm-to-market-Chinese-firms-truck-cranes-/articleshow/4773499.cms
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    Electric cars poised to give auto industry a jolt

    Within five years, the market for electric cars could reach between 270,000 and

    335,000 units per year in the U.S., predicts Art Spinella, president of CNW Research,

    a market research firm in Bandon, Ore. That would certainly confirm the arrival of the

    electric car as a real product in a way that has never happened before, though it

    would still represent only about 2 percent of total sales, Spinella points out.

    More

    Bridgestone recalls another 127,000 tyres

    Bridgestone Corp., the world's largest tire maker by sales, disclosed Tuesday it is

    recalling 127,183 Firestone-brand tires sold in the U.S. because a faulty tread could

    separate and cause an accident.

    More

    Bridgestone to Build a Retreaded Tire Plant in Thailand

    Bridgestone Corporation has announced plans to build a new plant for the production

    of procure tread for retread tires. This production base will help Bridgestone increase

    sales of its retread products as well as develop its solutions business in Japan, Asia,

    and China.

    More

    GM sales rise 38% in China

    GENERAL Motors (GM) China said vehicle sales in the world's most populous nation

    were up 38 per cent year-on-year as the market continued to outpace expectations for

    growth.

    The struggling US automaker and its joint ventures sold more than 800,000 vehicles

    in China in the first half of 2009.

    More

    China Car Sales Jump 48% on Economic Stimulus, Most Since 2006

    Chinas passenger-vehicle sales rose 48 percent in June, the biggest jump since

    February 2006, as government stimulus spending spurred a revival in the worlds

    third-largest economy. Chinese motorists bought 872,900 cars, sport-utility vehicles

    and other passenger vehicles last month, the China Association of Automobile

    Manufacturers said

    More

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    Regulatory Updates

    Auto industry cheers continuation of CENVAT cut

    6 July 2009

    Press Trust of India

    The Indian auto industry, which has been struggling hard to emerge from the sluggish market conditions, on Monday said

    that continuation of CENVAT cuts in the General Budget 2009-10 is a good step, but added that there could have been

    some incentives for exports.

    "I am happy on behalf of the whole industry as the Fringe Benefit Tax (FBT) has been abolished, but also little bit

    unhappy as MAT has been increased. It is a good step that the benefits of the stimulus packages have been continued,"

    Bajaj Auto Ltd Chairman Rahul Bajaj told PTI.

    Expressing similar sentiments, Society of Indian Automobile Manufacturers (SIAM) Director General Dilip Chenoy said

    the Budget has maintained stability in the prices of vehicles "infact it has reduced the prices in case of some vehicles by

    Rs 5,000". The government announced a four per cent cut in CENVAT in December as part of its stimulus package,

    which helped in riving the auto sales up to a certain extent.

    Chenoy said that abolition of surcharge on income tax, increase in the tax exemption limit, and abolition of Fringe Benefit

    Tax (FBT) would help increase consumer savings, boosting the purchasing power.

    The Budget on Monday proposed to reduce the additional excise duty on big cars with engine capacities of 2,000 cc and

    above by Rs 5,000 per unit. It also cut the duty of petrol-driven trucks to eight per cent from 20 per cent at present.

    The country's largest carmaker, Maruti Suzuki India, Chairman R C Bhargava said: "There are lot of positives in the

    Budget. The biggest positive of any Budget is continuing with a stable environment. Stability is very important for the

    industry, which is what he (the Finance Minister) has done."

    However, country's largest exporter Hyundai Motor India Managing Director H S Lheem expressed unhappiness with the

    Budget for not providing any incentives in promoting exports.

    "I am very disappointed as no attention was given to the exports of the auto industry. We expected some incentives for

    exports. It is the time to promote exports not only for the vehicle industry, but also for the auto component sector," he

    added.

    "We were expecting some rationalisation of taxes. But these have not happened. The automotive industry is one of the

    growth drivers of the economy and as such some tax relief would have helped the industry to generate some volumes,"

    he added. On the commercial vehicle front, which has been the hardest hit due to slowdown, Chenoy said nothing

    specific was done.

    Back to Top

    Automobile sector disappointed

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    8 July 2009

    The Hindu

    The Union Budget 2009-10 on Monday failed to enthuse the slowdown-hit auto industry. Though some reduction in excise

    duty on large cars and utility vehicles has been announced, the industry leaders said a complete package was the need

    of the hour for the revival of the industry, particularly for passenger car and commercial vehicle segments. The industry

    has, however, welcomed continuation of CENVAT cuts that were announced in December last.

    In his budget speech, Mr. Mukherjee announced the reduction of excise duty applicable to large cars and utility vehicles

    of engine capacity of 2000 cc and above to Rs. 15,000 from Rs. 20,000 per vehicle. Similarly, the excise duty on petrol

    driven trucks and lorries has been reduced from 20 per cent to 8 per cent; while on chassis of such trucks and lorries, the

    reduction is from 20 per cent to 8 per cent.

    Commenting on the budget, Society of Automobile Manufacturers President, Ravi Kant, who is also Managing Director of

    Tata Motors welcomed the reduction of the additional levy on large cars and utility vehicles and hoped that further

    rationalisation of tax rate would take place and the excise duty on utility vehicles and cars, other than small cars, would

    go down. While these proposals will have a positive impact on the automobile industry, these will be visible in the medium

    term and long term rather than having any immediate impact, more so for the commercial vehicle segment, which is going

    through severe downturn.

    Hyundai Motor India Managing Director H. S. Lheem said their demand for incentives for promoting exports has been

    ignored. I am very disappointed as no attention was given to the exports of the auto industry. We expected some

    incentives for exports. It is the time to promote exports not only for the vehicle industry, but also for the auto component

    sector, he added.

    Similarly, General Motors India President and Managing Director Karl Slym said the budget failed to meet the

    expectations of the auto industry. We were expecting some rationalisation of taxes. But these have not happened, he

    said. The automotive industry is one of the growth drivers of the economy and as such some tax relief would have helped

    the industry to generate some volumes, he said.

    Expressing his disappointment, Ford India Managing Director Michael Boneham said: The majority of demands of the

    automobile industry have not been addressed. The opportunity to rationalise excise duties on the passenger car segment

    has not been considered.

    Automotive Component Manufacturers Association of India President J. S. Chopra said overall, the Budget was neutral

    for the auto-component industry as it did not contain anything new for the industry. The small reduction in the excise duty

    on large cars and petrol driven trucks would have a very marginal positive impact on vehicle sales.

    Back to Top

    Effects of Recession

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    Mahindra Renault venture posts Rs 490-cr loss

    The Hindu Business Line

    12 July 2009

    Following a 48 per cent fall in sales, Mahindra Renault Pvt Ltd has posted a loss of Rs 490.21 crore on a gross turnover

    of Rs 741.17 crore during 2008-09.

    The company, a 51:49 joint venture between Mahindra & Mahindra (M&M) and Renault, of France, makes the Logan

    entry-level sedan at M&Ms Nashik plant.

    Drop in sales

    According to M&Ms 2008-09 annual report, the joint venture sold 13,423 cars during the year under review. In the

    previous year, the company sold 25,891 cars.

    In the first three months of this financial year, sales of the Logan have fallen nearly 68 per cent to 1,478 units from 4,595

    units in the corresponding period last year.

    The annual report attributed the decline in Logans sales to increased competitive activity in its market segment.

    Industry sales in the C-segment, where Logan competes, increased 12 per cent in financial year 2009, the annual report

    said.

    The C-segment itself grew 12 per cent last financial year, totalling 2.46 lakh units. M&Ms share in this segment dropped

    from 11.8 per cent in 2007-08 to 5.5 per cent last year.

    Light Commercial Vehicles

    M&M manufactures light commercial vehicles for another joint venture Mahindra Navistar Automotives Ltd and the

    Logan for the joint venture with Renault, on a contract basis. It also distributes these LCVs and cars for the two jointventure companies respectively under a distribution contract for a fee.

    Automobile industry experts say that Mahindra Renault Pvt Ltd will have to take a decision quickly on how long it is going

    to continue making the Logan.

    M&M has a capacity to make 50,000 units of the Logan a year, but with falling sales that capacity will be largely

    unutilised, they say.

    Automotive vehicles

    According to the annual report, the company maintained its automotive vehicles sales. It sold a total of 220,213 vehicles

    44,533 three-wheelers, 8,603 LCVs and 13,423 cars recording a growth of 0.6 per cent over the previous year.

    The company posted a consolidated profit after tax of Rs 1,405.41 crore down 10.5 per cent over the previous year. Its

    net revenue was up 10 per cent at Rs 26,919.8 crore.

    M&M has been aggressive in overseas acquisitions in the last two-three years, particularly with regard to the auto

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    component business. Information provided in its latest annual report shows that a number of these overseas subsidiaries,

    particularly in Europe in the forgings business, have reported losses.

    The acquisitions completed last financial year include Engines Engineering, Italy a two-wheeler design company;

    Metalcastello S.p.A., a gear manufacturing company in Italy; and, a second tractor joint venture in China. M&M formed a

    Systech sector, under which its overseas auto component acquisitions fall into.

    Farm-equipment

    In 2008-09, Mahindra & Mahindras Farm Equipment Sector formed a joint venture Mahindra Yueda (Yancheng) Tractor

    Company Ltd in China with Jiangsu Yueda Yancheng Tractor Manufacturing Company Ltd. M&M holds a 51 per cent

    stake in this joint venture. This company and an earlier tractor joint venture in China, Mahindra (China) Tractor Company

    Ltd, posted losses.

    According to the annual report, Mahindra (China) Tractor Company was able to grow by 21 per cent over the previous

    year despite the stagnant industry situation. This was made possible through the launch of Mahindra branded red tractors

    and expansion of the product range up to 40 HP segment on the current platform. In the last financial year, the company

    made the change over to selling tractors under the Mahindra Feng Shou brand.

    Back to Top

    M&M sees dip in automotive biz

    28 July 2009

    The Economic Times

    Mahindra & Mahindra (M&M) sees a sharp decline in automotive and tractor business and expects pressure on margins

    to continue in the current fiscal year. The Mumbai-based tractor maker, which made large-scale acquisitions in the

    automotive space in the recent past, saw revenues from the automotive business plunge to Rs 100.85 crore in FY09,

    from Rs 741.25 crore last year.

    A major threat to both the sectors lies in the escalation of raw material prices such as iron, steel and rubber, which are

    likely to put pressure on prices and affect margins or demand, the company has said in its latest annual report that has

    not yet been formally released. Although commodity prices have recently declined after peaking in the first half of 2009,

    the near-to-medium term remains unclear given the uncertainties in the global macro-economic environment.

    While high input costs can put pressure on automotive pricing, M&M says that its automotive sector continues to be

    amongst the most aggressive in passing on these costs to consumers, but may not be able to always do so in the

    future.

    Prices of steel a major input for M&M and one which is bought through long-term contracts had risen by about 80%till 2007 end. Although steel prices are seeing some correction, availability of finances may also affect company sales.

    Growing integration of the Indian economy with the global economy, events around the world have a direct or indirect

    impact on the Indian automobile industry, the company cautioned in the report. Indian financial markets are highly

    integrated to global financial markets. As a result, liquidity and availability of credit... will be impacted by conditions in the

    global markets, it added.

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    Auto companies have been absorbing input costs pressures in the recent past owing to falling sales. Any increase in

    price can affect demand, so most companies are holding to price increases, said a senior car company official. M&M is

    countering the threat of new players in the auto segment through a stronger focus on cost reduction and increased

    operational efficiency.

    M&M is also banking upon new products like the Xylo and the refreshed Scorpio to maintain its sales momentum. The

    company will continue its focus on achieving cost leadership through focused cost optimisation, value engineering, and

    improved efficiency measures like supply chain management, countrywide connectivity of all its suppliers and dealers,

    and exploiting synergies between its sectors, it said in the annual report.

    With the opening up of the defence sector for private sector participation, M&M has formed a separate division, MDS, that

    is likely to explore opportunities in high-end defence technologies space.

    Recently, engineering major Larsen & Toubro (L&T) and Europes EADS Defence and Security formed a joint venture

    (JV) company to make defence electronics products in the country. The JV will develop, design, and manufacture

    electronic warfare, radars, military avionics and mobile systems for Indian customers as well as for the global market.

    People close to the development said that M&M may look at similar opportunities.

    While evaluating possibilities for forming separate JVs/alliances with strategic partners for Land Systems and Naval

    Systems businesses, M&M is understood to be transferring the two businesses to two separate subsidiaries of the

    company.

    Back to Top

    Worst is behind us, says Leyland MD

    29 July 2009

    The Economic Times

    For commercial vehicle major Ashok Leyland, 2008-09 was one of the worst years in its 60- years history. But, the worst

    is behind us and first green shoots of growth is visible, noted the Hinduja Group flagship company MD R Seshasayee.

    Ashok Leyland (ALL) reported a net profit of Rs 190 crore for the year ended March 2009 compared with Rs 469 crore

    last year. Its headcount is 11,938 (13,304). The company declared 100% dividend and its sale revenue from vehicles,

    engines and spare parts during 2008-09 stood at Rs 6,666 crore (Rs 8,947 crore).

    In his presentation made at the AGM here on Tuesday, Mr Seshasayee said market demand is picking up and the

    economy is on an uptick but the growth momentum needs to be sustained.

    He said the global meltdown had impacted the Indian economy, which is in a deceleration state. The commercial vehicle

    industry, particularly medium and heavy duty segments, had fallen by 33%. The bus segment dipped by 10% while thetrucks fell by 37%.

    ALL sales dropped by 34.7% to touch 54,431 units in 2008-09 from a peak of 83,307 vehicles in the previous year. Being

    a cyclical industry, the fall was anticipated but lack of cash, capital and confidence has hit the company hard. The second

    half of the year had seen a precipitous fall as Ashok Leyland lost 1.8% market share. Regional imbalances too adversely

    affected its performance which reflected in its traditional stronghold south witnessing a steep drop.

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    Lack of significant presence in the east where the market held its own also impacted ALL. However, demand for semi-

    forward cab vehicles had surged, Mr Seshasayee said. Despite all this, the company had not lost in the bus market

    segment, where it maintained its leadership position with 46% market share.

    Export markets posed severe challenges with the market collapsing following civil war in Sri Lanka. In the Middle East,

    especially Dubai, ALL faced extreme challenges as the number of vehicles sold declined from 300 to 30 in the second

    half of the fiscal.

    Seeing significant growth in the engine business, Mr Seshasayee said ALL had managed to maintain its unbroken track

    record of profitability. Prudent in borrowings reflected in its stability.

    To combat downturn, ALL has initiated a slew of steps including focusing on non-cyclical business, cash conservation,

    internal cost-cutting measures and improvement in competitiveness.

    Noting that it is the fourth cycle of business that he has been associated with, Mr Seshasayee said the non-cyclical

    business contribution had shot up from 34% to 50%. This was also due to some large government contracts bagged by

    ALL. There has been a spurt of purchases from the defence sector and in the coming years, results would start showing.

    To overcome vulnerability in some markets, ALL is consciously targeting new export markets. A capex reduction from Rs

    3,000 crore to Rs 2,000 crore over the next 3 years too is one way of conserving cash resource, he said, adding to move

    from an accelerated to a braking mode is painful. Since January, applying the brakes has been a hurtful process.

    Seeing airport as a growing segment, he said ALL has the distinction of producing Indias first H -CNG engine. The

    company has also expanded its dealership network to 170, authorised service centre to 146 and workshops to 2,300.

    Back to Top

    Michelin Posts Loss on Sales Slump, Restructuring Costs

    31 July 2009

    www.bloomberg.com

    Michelin & Cie., the worlds second- largest tiremaker, reported a loss in the first half on a slump in sales to vehicle

    manufacturers and trucking companies hit by the global recession.

    The net loss was 119 million euros ($168.1 million) compared with net income of 430 million euros a year earlier, the

    Clermont-Ferrand, France-based company said in a statement today. Sales fell 13 percent to 7.13 billion euros. Analysts

    had expected a 320 million-euro loss on sales of 7.09 billion euros, according to the median of estimates compiled by

    Bloomberg.

    Inventories have now returned to more normal levels, but not to the extent that we can talk about a real upturn, ChiefExecutive Officer Michel Rollier said in the statement. Declining raw-material prices should support second-half margins.

    Tiremakers are being squeezed by a slowdown in vehicle production and weakening sales of replacement truck tires, as

    the recession hits freight carriers and construction companies. While government-backed sales incentives halted

    Europes auto- market slump last month, demand was 11 percent lower for the first half overall. Michelin rose 2.01 euros,

    or 4.4 percent, in Paris yesterday, extending the stocks gain this year to 26 percent and valuing the company at 7 billion

    euros.

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    The company gave no earnings forecast for the full year. Rollier said in February the 10 percent operating margin

    originally targeted for 2010 may be achieved a little later as the sales slide forces the postponement of some

    investments.

    Earnings Details

    Michelin recorded a first-half operating profit of 282 million euros, excluding one-time gains and losses, for an operating

    margin of 4 percent. That compared with a 708 million- euro profit a year earlier, or 8.6 percent of sales.

    Raw-material costs wiped 117 million euros off first-half profit, Michelin said. Rollier had cautioned in February that the

    decline in rubber and oil prices since last year would not trickle through to Michelins earnings until the second half.

    The price of natural rubber fell by more than half in the 12 months following its June 30, 2008, peak of 356.9 yen ($3.94)

    per kilogram, mirrored by the drop in crude oil in the period. Michelin said its truck-tire operations recorded a 163 million-

    euro operating loss, after a profit of 139 million euros a year earlier, as sales plunged 23 percent to 2.07 billion euros.

    The operating margin on car tires fell to 6.3 percent from 7.6 percent a year earlier on a 9.4 percent decline in sales, the

    company said. The profitability of specialty tires for airplanes and construction equipment fell 2 points to 18 percent, as

    sales fell 6.1 percent to 1.11 billion euros.

    Michelin pledged in April to cut investment by 45 percent this year, predicting that sales would begin to recover after

    declining throughout the first half. The company announced the closure of a B.F. Goodrich plant in Alabama the same

    month, with the loss of about 1,000 jobs. Globally, it plans to continue reducing the workforce at a rate of 3-4 percent per

    year.

    Back to Top

    US auto bankruptcies hit Indian auto suppliers: Fitch

    9 July 2009

    PTI

    The bankruptcies of leading American car makers Chrysler and General Motors coupled with depreciation of the rupee

    could adversely impact the prospects of the Indian auto suppliers, says a report.

    "The high degree of consolidation in the US auto market, which has become the second-largest export destination for the

    Indian auto component sector, may clearly hinder the prospects of early revival," global credit ratings agency Fitch

    Ratings today said.

    According to the report, the export-oriented suppliers have suffered an even sharper decline in sales and profitability, due

    to the slump in the global markets and the bankruptcy filing by major US auto makers (Chrysler and GM)." While Chryslerhas exited bankruptcy, GM is expected to come out of bankruptcy in the coming weeks.

    Fitch Ratings asserted that reduction in export revenues and depreciation of the rupee against the dollar has forced some

    auto suppliers to restructure their borrowings into longer maturities, in order to reduce the imminent pressure on cash

    flows.

    In its report on the Indian auto suppliers, Fitch Ratings pointed out that such a situation could prolong the payment period

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    for outstanding dues from these automakers

    Back to Top

    Ratan Tata calls for cost cuts at Jaguar Land Rover

    30 July 2009

    The Economic Times

    Jaguar Land Rover (JLR), the marque brands acquired by Tata Motors from the Ford Motor Company in June 2008

    needs cost reduction and reduction of development and productionising time as the global recessionary trends haveseen a sharp fall in luxury vehicle sales.

    The challenge for Jaguar Land Rover will be to sustain operations through this difficult period, the chairman, Ratan Tata

    said in the companys latest annual report. This will, however, call for a change from some of the traditional practices and

    a commitment to encourage change.

    As part of a new strategic initiative, JLR is planning to have all its future cars constructed with light-weight aluminium

    bodies to reduce weight and cut CO2 emissions. JLR is also identifying sources of components from India, recognising

    engineering and computer-aided design capabilities within Tata Motors.

    It is also developing a hybrid powertrain which will be introduced in future models of Jaguar and Land Rover. Several

    new models are under development and will be released in the market in the coming years. These will widen the project

    range and re-energise the range, Mr Tata said. Officials believe that t he new products and more aggressive marketing

    will see it through this period.

    Tata Motors has also hired KPMG International and Roland Berger Strategy Consultants to reduce costs and increase

    cash flow. I feel strongly that in later years we can look back on the JLR acquisition and say to ourselves that this was a

    very worthwhile strategic acquisition and one which has brought us considerable technology and global presence, Mr

    Tata said in the report.

    While the US, Europe and Japan have seen new car sales decline by 16% in the second half of 2008, China and India

    have been exceptions. China has witnessed a significant reduction in its automotive-related exports and supplies to

    automobile companies and the Chinese domestic car market has grown by 7%.

    In India, the passenger car market has remained more or less flat compared to the previous year. However, the

    economic downturn in India which has affected spending in infrastructure, construction and general road transport, has, in

    turn, seriously affected the commercial vehicle sector where sales declined by 33%, said Mr Tata in the annual report.

    The deferment of infrastructure projects and the slowdown in the mining sector have resulted in a tremendous drop in

    demand for medium and heavy vehicles. However the CV sector is showing signs of revival since the first quarter of2009-10, but it will still be a long and arduous road to recovery.

    Back to Top

    Press Release

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    Tata Motors net up 58% on low input cost

    28 July 2009

    The Times of India

    Tata Motors posted better-than-expected quarterly earnings driven mainly by fall in raw material prices and the new

    accounting rules on forex differences.

    The company, India's largest vehicle manufacturer, said it saw signs of recovery for the business both within and outside

    India. In addition, the government's renewed thrust on infrastructure and tax cuts would aid growth in coming quarters.

    The Tata group flagship reported a 58% growth in net profit to Rs 514 crore in the first quarter ended June 30 as against

    Rs 326 crore in the previous corresponding quarter.

    The earnings far exceeded market forecast of low profits, lifting the stock up by up to 3.9% during the last minutes of

    trade. The scrip finally ended 0.4% up at Rs 375 in a flat stock market.

    During the quarter, net revenue fell 7.6% to Rs 6,405 crore. The earnings represent Tata Motors's standalone

    performance and don't include that of the JLR and Daewoo operations. The company management said it has repaid

    $150 million of the $1-billion JLR bridge loan. The company had raised the money last month by selling 1.5% stake in

    Tata Steel. It has roped in two international consultancy firms KPMG and Roland Berger to advise the company on cutting

    costs and reducing complexities at its loss making Jaguar and Land Rover units. The consultants have been working on

    this for over two months, said Tata Motors vice-chairman Ravi Kant.

    The company posted a notional forex loss of Rs 6 crore as against Rs 162 crore in the previous corresponding period. In

    a statement it said profit before tax in the year-ago quarter would have been higher by Rs 176 crore under the revised

    accounting policy effective March, 2009. Sales declined as falling earnings forced customers to defer purchases of cars

    and trucks.

    Within the passenger cars portfolio, it gained market share in the sedan segment but lost in SUVs. The star performer,

    however, was the Indica Vista. In commercial vehicles, while light commercial vehicles saw an improvement, demand is

    yet to pick up in heavy commercial vehicles.

    Exports fell 43%, particularly in its key market South Africa. Softening commodity and crude prices had a positive impact

    on earnings. Raw material consumption declined 24% during the period under review. Operating margins improved by

    400 basis points.

    Credit Analysis & Research head Reveti Kasture said, After turbulence during Q2 FY09, the automobile industry has

    shown signs of revival, boosted by three stimulus packages. The recuperating consumer sentiment, picking up of the job

    market, relatively cheaper auto finance and improving liquidity scenario would augment the growth of passenger vehicle

    sales by 6-7% in FY10. The pick up in industrial production and economic activities is expected to expand the commercial

    vehicle market.''

    Back to Top

    Mahindra Tractors sales rise 51.92 pc in June

    1 July 2009

    Indopia

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    Farm equipment maker Mahindra Tractors today reported a 51.92 per cent rise in its total tractor sales in June at 18,242

    units compared with 12,008 units in the same month last year.

    The domestic sales in last month grew by 61.13 per cent at 17,811 units against 11,054 units in the year-ago period, the

    company said in a statement.

    "The sentiment in the market is very positive because the MSP (minimum support price) paid for last year & aposs crop

    was very high and we had a very good monsoon.

    Availability of finance and lowering of interest rates by the banks have helped in boosting the sales, Mahindra& Mahindra

    President (Farm Equipment Sector) Anjanikumar Choudhari told PTI.

    Exports, however, fell by 54.82 per cent to 431 units from 954 units in the corresponding period last year.

    Asked about the fall in exports, Choudhari said:" Exports to Africa and the SAARC countries was normal, but the export

    market in the US was severely affected due to the economic meltdown there."

    The company said that as a consequence its merger with Punjab Tractors Ltd (PTL), effective from August 1, 2008, the

    total sales also includes 4,676 units of the merged entity.

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    M&M plans to roll out diesel trucks in US

    9 July 2009

    The Economic Times

    Utility and tractor major Mahindra & Mahindra is stepping up plans to launch diesel-powered pick-up trucks in the US,

    even as global carmakers such as Honda, Toyota, Nissan and Ford have put similar pick-up launches in the US, on hold.

    People connected with the development said the Mumbai-based company wants to cash in on the opportunity created by

    the disinterest of global majors, by competitively pricing its products in the American market, which is slowly limping back

    after getting mauled in the slowdown.

    Global carmakers had put off showcasing their diesel products, after the credit squeeze seen post the Lehman Brothers

    collapse, and also because of the shift in focus with the launch of alternate-powered vehicles such as hybrid cars.

    By December 2009, M&M plans to launch the diesel-powered two-door and four-door pick-up trucks. While there are no

    concrete plans to launch the hybrids, the Scorpio will be launched a year later.

    M&M is yet to decide on the pricing, production targets and advertising spends for the US market. Stringent emission

    norms is forcing M&M to reconfigure the vehicles it proposes to launch in the highly-competitive US market, said those

    connected with the project.

    The auto major will initially start pick-up operations and those of SUVs through the completely-built-unit route followed by

    the completely-knocked-down route. The SUV will be based on the Scorpio platform, but will be completely redesigned for

    the US market and badged differently, said sources. The company intends to start local assembly operations when

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    volumes start picking up.

    However, it isnt yet clear how M&M intends to market its products. As the companys diesel -powered pick-ups had slow

    sales in South Africa, where they were launched in 2006. Compared to that, US are a mature market and consumer

    behaviour will tend to be markedly different, said one analyst who tracks M&M.

    The company has tied up with US biggest vehicle distributor Global Vehicles to sell the brand, which in turn, has

    appointed around 263 dealers.

    As the US is a brand-conscious market and M&M is little-known there, the company will initially target the vehicles at the

    green consumers, tractor customers and the Indian expatriates in the US.

    M&M has CKD plants in Brazil and Egypt. It has a presence through the CBU route in Australia, South and Central

    America.

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    Commercial vehicle market in India to rise

    7 July 2009

    Indus News Wire

    The commercial vehicles market in India is set to experience significant changes with the hub-and-spoke model of

    transportation, according to a recent report from Frost & Sullivan.

    With the burgeoning road infrastructure development, commercial vehicle sales will be driven by a focus on application-

    specific commercial vehicles such as medium and heavy commercial vehicles for long distance transportation and light

    commercial vehicles, typically the sub-3.5-ton vehicles, for local transportation. The sub-3.5-ton light commercial vehicle

    segment is poised to capture a significant share of the overall commercial vehicles market and is expected to witness

    intensifying competition with the entry of more participants, according to Frost & Sullivan.

    Data from Frost & Sullivan finds that the production of commercial vehicles in India stood at 417,126 units in 2008 with

    sales of 384,122 units in the same year. Production, domestic sales and exports dropped in 2008 due to economic

    slowdown.

    The rising demand for specialized vehicles, due to the creation of the hub-and-spoke model is driving the commercial

    vehicles market in India, said Frost & Sullivan Industry analyst Sanjay Vasudevan. Growth in segments such as retail and

    intra-city goods transportation needs has contributed to the increase in demand for sub 3.5 ton light commercial

    vehicles.

    The National Highways Development Program for improving road infrastructure and national highways will also impel thedemand for commercial vehicles with a significant rise in goods and passenger transport by road, due to enhanced

    connectivity.

    Consolidation and increasing maturity of the transportation sector in India, because of improved infrastructure, has

    resulted in a shift in the segment sales of commercial vehicles. Truck sales are on an upswing because of fleet

    replacement and the establishment of a new segment of sub-1 ton vehicles. The contribution of light commercial vehicle

    to the total demand for commercial vehicles has been increasing due to the rapidly expanding usage of smaller vehicles,

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    intra-city transportation, and the creation of a new segment of small commercial vehicles, following the introduction of the

    highly successful Tata Ace, according to Frost & Sullivan.

    New product introduction, coupled with significant technology changes and features, will be observed in the light

    commercial vehicle market. Light commercial vehicle products for executive mass transport will occupy a niche and set to

    experience a significant growth in demand. Accordingly, the commercial vehicles market is reorganizing its product

    portfolio, in synch with the changing demand pattern. However, growth in the next three years is likely to be moderate

    compared to the blistering growth witnessed in the last two to three years, Frost & Sullivan said.

    Domestic companies, with a significant three wheeled goods carrier portfolio, are anticipated to rush into the sub 3.5 ton

    four wheeled commercial vehicles, to keep abreast with the market trend, said Vasudevan. Growth will be largely driven

    by the sub 1 ton category for last mile transport requirements. Exports of medium and heavy commercial vehicles are

    also in full swing as local medium and heavy commercial vehicles manufacturers eye the overseas market to enhance

    their business.

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    Bank of Rajasthan ties up with Mahindra & Mahindra

    India PRwire

    14 July 2009

    Bank of Rajasthan, one of the fastest growing, technology driven and customer friendly private sector bank, has

    announced tie-up by signing memorandum of understanding (MOU) with Mahindra & Mahindra one of the leading

    automobile & tractor manufacturer in India. This pact will help farmers in Rajasthan to obtain loan for tractors & farm

    equipments at a lower interest rate.

    This MOU will help farmers in Rajasthan to get benefit of tractor loan up to Rs. 10 lakhs at interest rate of 11.00 % p.a

    and for loan above Rs. 10 lakhs at a rate of 11.50 % p.a. Repayment of loan can be made in the period 7 -9 years. One of

    the features of this tie up is quick disposal of proposals within a period of 7-15 days.

    The Bank has also waived processing charges on the said loan. Besides, a special discount of Rs. 5000/- would be

    provided by the dealer to the farmer.

    The foremost advantage of this scheme is that it offers credit not only to bigger farmers but also to small and marginal

    farmers with a land holding of four acres as well.

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    Ashok Leyland, John Deere float equal stake venture

    13 July 2009IANS

    The countrys second largest truck maker Ashok Leyland and the US-headquartered John Deere Construction and

    Forestry Company Monday announced floating of a 50:50 equal stake joint venture company to manufacture and market

    earthmoving equipments.

    The company Ashok Leyland John Deere Construction Equipment Private Limited will initially make backhoe and wheel

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    loaders and will set up a plant near here, a company release said.

    The pilot production is expected to start from Oct 2010 and full fledged production by Jan 2011.

    The statement does not specify the new companys financial and production capabilities.

    The new company combines Ashok Leylands expertise and broad pan -India distribution network with John Deeres

    technical know-how and vast experience in the construction equipment business.

    John Deere is the worlds largest manufacturer of equipment for agriculture and forestry.

    The $2.5 billion Indian construction equipment industry has been on a growth trajectory and forecasts 20 percent year-on-

    year growth for next 5 years.

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    Auto cos ride the green wave in Europe

    8 July 2009

    The Economic Times

    Indian carmakers are reaping the benefits of the incentives offered by the governments of Germany, France and the UK

    to people exchanging their old cars for new fuel-efficient ones.

    The country's largest car exporter, Hyundai Motor India, recorded its highest export growth last month, while Maruti

    Suzuki is raising its export target, as the scrappage policy in Europe that gives e750-5,000 (Rs 50,000-350,000) to people

    buying fuel-efficient cars has led to an increase in demand for their small cars.

    The 11-year-old subsidiary of Korean carmaker Hyundai Motor recorded a 33% growth in exports in June to 24,241 cars

    over the same month last year. On a sequential basis, exports increased 21% in June from 20,125 cars in May. Maruti's

    exports rose 176% to 13,336 cars last month over 4,836 cars sold overseas in the same month last year. Month-on-month exports increased 47% from 9,087 cars in May this year. Three small cars A-Star, i10 and i20 are the biggest

    grossers in Europe, as these fuel-efficient models emit low volumes of carbon dioxide per kilometer.

    Thanks to booming exports, Hyundai's production schedule for exports is already booked for the next two months and the

    company is now looking at bagging orders for September and beyond, helping the company post handsome profits. This

    is likely to help the company that recorded a loss of Rs 87 crore in the quarter ended March due to currency fluctuations.

    "Exports have jumped, as monetary incentives for fuel-efficient and eco-friendly cars, low on emission, have gone up in

    Europe. We fit the bill, as our new cars i10 and i20 adhere to such standards," Hyundai's senior vice-president (sales &

    marketing) Arvind Saxena said.

    Germany, better known for its luxury marques BMW, Audi and Mercedes, has set aside e5 billion to make the country

    eco-friendly by encouraging fuel-efficient cars. Those exchanging big cars for small fuel-efficient ones will get e2,500.

    Spain will barter two-lakh cars by giving e2,000 in cash to people exchanging fuel guzzlers.

    France offers an incentive of e1,000 with deferred tax benefit of up to e5,000 on each car with carbon dioxide emissions

    less than 160 gm/km. Italy is extending a e3,000 payout for all new cars emitting carbon dioxide below 130 gm/km.

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    "Our parent Suzuki Motor's distribution network in Europe is clogged with bookings," Maruti's executive officer (sales &

    marketing) Mayank Pareek said. Maruti aims to export two lakh cars in FY10 from the 70,000 cars it exported in FY09.

    The spurt in demand for 'made in India' cars is likely to be a major growth driver for other carmakers entering the small

    car space. Toyota, GM, and Ford are looking at a possible debut in compact cars by next year. Eyeing the potential in

    mind, Toyota Kirloskar Motor, the Indian unit of Japan's Toyota Motor Corp, has increased investment by an additional Rs

    800 crore, taking it to Rs 4,000 crore till 2016 in its small car manufacturing facility near Bangalore.

    "The Indian subsidiary will play a larger role in global operations. Besides the domestic market, our small car, coming next

    year, will also cater to several overseas markets," said a TKM executive, requesting anonymity.

    Back to Top

    P K Ruia may step down from boards of all group cos

    7 July 2009

    Business Standard

    Ruia group Chairman P K Ruia may step down from the board and allow the group companies to be managed by

    professionals, while he would remain group chairman. Ruia, who had last year stepped down from the board of wagon

    manufacturer Jessop & Co, said today that the model of management in the group companies could be based on the one

    in Jessop.

    This model would be followed only in companies which were on the right track. When asked about Dunlop India, Ruia

    said it was not on the right track. He did not categorically say whether he would continue as executive chairman of the

    ailing tyre company.

    On commencement of operations at Dunlop, Ruia said funds were ready, but it hinged on a court case related to non-

    restoration of power in the plant. Speaking about Jessop, Ruia said he was planning to list Jessop on the stock

    exchanges.

    "To get it listed our holding has to be brought down to 75 per cent from over 94.5 per cent currently. There are a few

    options like inducting strategic investors and disinvestment," Ruia said while speaking on the sidelines of Jessop & Co

    AGM. The Durgapur facility of Jessop may reopen this year. The company would install the machinery of Mukund

    Foundry. So far, Ruia has invested Rs 30 crore in the plant.

    Back to Top

    MRF blames militant group for unrest at Arakkonam plant

    12 July 2009

    Economic Times

    Indian tyre major, MRFs Arakkonam plant, re-opened on May 27, 2009 after a lock out, is still caught in the grip of labour

    unrest mainly due to the agitation by a section of workmen led by a splinter group.

    Recently, the State Labour Minister, T M Anbarasan informed the Assembly, following the efforts of labour department,

    904 workmen had returned to work by accepting the bipartite settlement with MRF workers welfare union. However, 494

    workmen belonging to MRF-ULF have not resumed work.

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    The plant has a total workforce of 3262 including contract labour and trainees. The Minister said a case is pending before

    Madras High court on the petition filed by MRF-ULF. It has been pressing for recognition as per ILO recommendations

    and insisting on signing a wage settlement with it. Stating the Government is keenly watching the development; the

    Minister told the house depending on the court order, Government will take further action. Meanwhile, MRF in a statement

    on Saturday said the Arakkonsm unit always had good industrial relations. It blamed a militant splinter group for carrying

    out a vilification and misinformation campaign against the industrial climate prevailing in Tamil Nadu and against MRF

    and Arakkonam factory. It said despite a popular wage settlement reached with recognised unions offering substantial

    benefits to the workmen, the splinter militant group, in the garb of trade union activities, had indulged in violence and tried

    to scuttle the accord. It had shown disrespect to the advice of Government and courts.

    The company said majority of the workmen, who saw the malafide intentions of the group, had resumed work. Thus, near

    normalcy has been restored in the production and supplies to OEs, dealers and other undertakings. The company said,

    The management of MRF sincerely believes the misled workmen, the general public and the Government agencies

    should not be influenced by vilification campaigns, being relentlessly carried by the splinter group and their leaders."

    Back to Top

    ATMA expects Rs. 6,000 crore worth investments in Indian tyremaking industry

    20 July 2009

    www.wheelsunplugged.com

    Discerning the surging demand for truck and bus radial tyres, the Indian tyremaking industry (which is into manufacturing

    radial tyres) could see investments worth Rs. 6,000 crore in the next few years, thereby generating an extra capacity of

    3.77 million units truck and bus radials, as predicted by Automotive Tyre Manufacturers Association.

    Radial tyres typically offer better fuel efficiency and last longer than regular tyres. Currently, only about 8-12 per cent of

    trucks and buses in India run on radial tyres, which is expected to go up to atleast 20-25 per cent in the next few years.

    Especially, after the government banned imports on Chinese radial tyres, multinational tyre companies like Continental

    AG, Bridgestone, Michelin et al, who had already set up their distribution base in the country, are considering to pump in

    huge sums of money for setting up a greenfield facility. Other global giants like Pirelli, Kumho, Hankook, and Yokohama

    are also expected to follow the same route, although none of them has yet confirmed its plans.

    It may be recalled that the Foreign Investments Promotion Board (FIPB) has approved French tyremaker; Compagnie

    Financiere Michelin (CFM) proposed Rs. 11,000-crore foreign direct investment for establishing a wholly-owned

    subsidiary and which would entail building a state-of-the-art manufacturing facility in Tamil Nadu for rolling out radial and

    off-the-road tyres, tubes and ancillary tyre related products. The Indian arm of Clermont-Ferrand company is planning to

    invest Rs. 4,000 crore over a period of seven years and intends to make a further infusion of Rs. 7,000 crore over a

    period of three years, after the completion of the initial funding depending on the progress of the project and demand of

    the tyre market. This first phase operation is anticipated to create 1,500 jobs, and eventually half the factorys output wil l

    be exported, and the company may consider scaling up its output with after the first phase, creating 500 jobs additionally.

    Though it could not be officially confirmed, speculation is pretty rife that Michelin had been holding discussions with the

    Tamil Nadu state government to for setting to set up a greenfield facility on a 290-acre land at the SIPCOT Industrial Park

    in Oragadam, near 40 km from Chennai (in Tamil Nadu), where Daimler AG would also be establishing its commercial

    vehicle plant.

    Likewise, Apollo Tyres is all set to commence production at its greenfield facility at Oragadam near Chennai by

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    November09, where it will be rolling out truck, bus and light truck radial tyres, along with high and ultra-high performance

    passenger car radial tyres for the domestic and export markets. The plant will have a capacity to produce 8,000 tyres a

    day, according to the companys press release. The 135-acre facility is to come up at the Oragadam Industrial Park

    promoted by the State Industries Promotion Corporation of Tamil Nadu (SIPCOT) near Kanchipuram on the Chennai-

    Bangalore route.

    Furthermore, JK Tyres Ltd would be infusing Rs. 700 crore at its truck and bus radial plant in Mysore to increase capacity

    to 12 lakh units from the current capacity of 368,000 units.

    It was reported earlier that Madras Rubber Factory (MRF) has entered into an agreement with the Tamil Nadu state

    government to set up a manufacturing unit with an initial production capacity of 3.5 lakh radial tyres (for both trucks and

    cars) a month in the first phase, which would be doubled by the end of 2009. The company has earmarked Rs. 600-800

    crore for the project at a 290-acre site in Perambulur, near Tiruchi in Tamil Nadu. Nearly 2,500 jobs would be created

    when the production goes on-stream. Its competitor, Dunlop Tyres will also be entering this segment.

    Back to Top

    Tyres made from trees cheaper, more fuel efficient: Research

    23 July 2009

    Economic Times

    Automobile owners around the world in the near future might drive on tyres that are partly made out of trees - which could

    cost less, perform better and save on fuel and energy. Wood science researchers at Oregon State University in US found

    the potential of microcrystalline cellulose - a product that can be made easily from almost any type of plant fibers - to

    partially replace silica as reinforcing filler in the manufacture of rubber tyres. The study suggests that this approach might

    decrease the energy required to produce the tyre, reduce costs, and better resist heat buildup. Early tests indicate that

    such products would have comparable traction on cold or wet pavement, be just as strong, and provide even higher fuel

    efficiency than traditional tyres in hot weather.

    "We were surprised at how favourable the results were for the use of this material," said Kaichang Li, an associate

    professor of wood science and engineering in the OSU College of Forestry, who conducted this research with graduate

    student Wen Bai.

    "This could lead to a new generation of automotive tyre technology, one of the first fundamental changes to come around

    in a long time," Li said. Cellulose fiber has been used for some time as reinforcement in some types of rubber and

    automotive products, such as belts, hoses and insulation - but never in tyres, where the preferred fillers are carbon black

    and silica. Carbon black, however, is made from increasingly expensive oil, and the processing of silica is energy-

    intensive. Both products are very dense and reduce the fuel efficiency of automobiles. In this study, OSU researchers

    replaced up to about 12 percent of the silica used in conventional tyre manufacture. This decreased the amount of energy

    needed to compound the rubber composite, improved the heat resistance of the product, and retained tensile strength.

    More research is needed to confirm the long-term durability of tyres made with partial replacement of silica, Li said.

    Further commercial development of this technology by a tire manufacturer could be undertaken at any time, he said. The

    newest findings were recently published in a journal, Composites Part A: Applied Science and Manufacturing.

    Back to Top

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    Bridgestone to expand production capacity

    24 July

    www.central chronicle.com

    Bridgestone, the world's no. one tyre and rubber manufacturer, announced a production capacity expansion at its unit in

    Pithampur at Indore (Madhya Pradesh). The additional capacity facility will ramp up the production of tyres by 4,500

    (units) per day. Mr Takashi Urano, Vice President and Senior Officer, International Tyre Business Operations of

    Bridgestone Corporation, Japan, in a release here said, ''India is growing rapidly, and its potential seems to be unlimited.

    Success in India is essential and inevitable for Bridgestone to reach the goal to become undisputed no. one tyre and

    rubber company in the world both in name and reality.'' ''We are going to put more focus on Indian market than ever, and

    are looking for newer possibilities to grow further'', Bridgestone India Managing Director H Tanigawa said.

    Bridgestone has invested Rs 259 crore for this additional capacity expansion project. The expansion will in turn increase

    the total production capacity by around 40 per cent of the current. This will also generate an additional employment for

    approximately 300 people, he said.

    Back to Top

    Volvo cuts prices of sports vehicle XC90 by Rs 4 lakh

    9 July 2009

    PTI

    Luxury car maker Volvo Car India on Thursday said it has cut the prices of its flagship sports utility vehicle XC90 by Rs 4

    lakh to boost sales amidst the current economic downturn. The XC90 D5 will now come at Rs 42.5 lakh, while the XC90

    32 and XC90 V8 would be available for Rs 43.5 lakh and Rs 49.5 lakh, respectively.

    "In lieu with current economic scenario and to provide luxury at right price, the prices for the flagship model Volvo XC90

    SUV has been reduced by 7-8.5 per cent with effect from July 9," Volvo Car India said in a statement. The company alsoannounced opening of new dealerships at Pune and Chennai, taking the total number of dealerships in the country to

    seven.

    "The expansion of our dealer network signals the importance of the Indian market to Volvo Cars. We believe that India

    holds tremendous potential for our brand and want to make sure that we fully capitalise on the opportunities available...,"

    Volvo Car India MD Paul de Voids said.

    Recently, other car makers including Hindustan Motors, Ford India, Honda Siel Cars India and Hyundai Motor India had

    announced price cuts of Rs 6,000 on some of the