18 June 2009;economictimes.indiatimes.com:Chanchal Pal Chauhan & Vivek Sinha:NEW DELHI: In what would be one of the largest FDI inflows into the country, Michelin & Cie, the world’s second-largest tyre maker, is looking to invest up to Rs 7,000 crore ($1.48 billion) in India over a 10-year period to make and market radial tyres and tubes in the country. Incidentally, this development follows the French tyre manufacturer’s announcement to cut 2,900 jobs in France as part of a business reorganisation to focus on higher-margin tyres. For Michelin, this project comes after a joint venture with Delhi-based Apollo Tyres failed to take off. Apollo Tyres has already given a no- objection certificate (NOC) to Michelin to start its own operations in the country even as the French tyre major continues to own around 8% in it. A person directly involved in the transaction said the French tyre giant has sought government approval to acquire 100% stake in a new company Michelin India Tamil Nadu Tyres formed in April 2009. This company will set up the proposed greenfield unit, which would absorb investment worth Rs 4,000 crore in the first phase running into 2016. “The company may ramp up investments by another Rs 3,000 crore after the first phase,” said the person who did not wish to be identified. Michelin has been negotiating with the Tamil Nadu government for procuring land for the project. It wants to set up a plant on 290 acres in an industrial park developed by State Industries Promotion Corporation of Tamil Nadu. The first phase of the proposed project in Tamil Nadu will provide jobs to around 1,500 people, which may go up to 2,000 after further investment of Rs 3,000 crore is made. Over time, half of the tyres and tubes produced at the plant will be exported. The slack demand of tyres has impacted all major markets across the globe, especially in the US and Europe where sales have fallen by a third in the past few months. Tyre sales in India, however, had kept the industry buoyant riding on the back of rising passenger car and two-wheeler sales. Strong demand from the replacement market after a high single-digit growth in FY09 for the 10 crore vehicles plying in India has also helped the tyre market. In the past, many multinationals companies have announced multi-billion dollar projects for India, but many of them have delayed investment either because of the slowdown or because of regulatory constraints on foreign direct investment (FDI) in the country. Most recently, Swedish furnishings retailer Ikea decided to postpone its foray into India in the wake of continuing restrictions on FDI in retail sector. There are no such restrictions on FDI in the tyre sector.
18 June 2009;business-standard.com:New Delhi: Fiat India Automobiles Ltd (FIAL), a 50:50 joint venture between the Fiat Group and Tata Motors, may consider entering the 600cc car segment. “The 600cc segment excites every car manufacturer. We have no plans for this segment now. But there could be something down the road,” said FIAL CEO Rajeev Kapoor on the sidelines of the launch of the company’s third small car — Grande Punto. Kapoor said the company’s current priorities lay in strengthening its presence in the compact car (A2 plus) segment, in which it had a market share of 10 per cent. Tata Motors’ Nano will be available at dealerships for delivery next month. Kapoor also spoke of plans to launch a car in the mid-size sedan category, which is currently dominated by Maruti Suzuki’s Dzire. “There’s nothing that stops us from entering this segment. We are waiting for the market to stabilise.” On the company’s plans to enter the utility vehicle segment, Kapoor said the current environment was not conducive for more Fiat models to be launched. “Once growth sets in, the whole range of Fiat’s portfolio will be available.” The company’s future plans, according to Kapoor, revolves around launching new passenger vehicle models,. “even if it means launching vehicles outside the current joint venture with Tata Motors,” Kapoor explained. The company’s Italian parent bought bankrupt American car major Chrysler this year. To a question whether Fiat India would consider launching Chrysler’s brand in the domestic market, Silverio Bonfiglioli, CEO of Fiat Group Automobiles, replied: “Why not?”
17 June 2009;economictimes.indiatimes.com:Anirvan Ghosh:BANGALORE: The automotive slowdown has prompted Honda Siel Cars India (HSCI) to put its new assembly plant operations on hold and also pause hiring employees for its plant at Tapukara in Rajasthan. This comes even as the rising yen and dollar compelled the company to price the new hatchback model Jazz higher than what it had hoped to. “We had earlier planned the new plant to start by this year, but are not able to,” said Tatsuya Natsume, director, marketing, HSCI. The total cost of the plant is estimated at Rs 1,000 crore. Investments in the plant slowed down since December last year, and now it’s stopped till the automotive market in India improves. The new plant, which was shut down mid-way, now faces an uncertain future for the time being. “We do now know when the next Rs 400 crore (required for the plant to go on stream) will come,” he said, the first time the company admitted this uncertainty, in a chat with ET. “We have a target that the market should reach two million units of cars before we pour in more investments in India,” he said. The domestic car market was estimated at 1.2 million units in FY09 and growing at a sluggish pace in the wake of the economic slowdown. This also means that the date for the launch of the next small car, to be smaller in size than the 1.2 litre Jazz, is also not certain anymore. HSCI had planned to set up the second plant in Rajasthan with an initial capacity of 60,000 units, while it expanded capacity at its Greater Noida facility to one lakh unit per year. It will launch its next small car by 2011. The company is going aggressive on localisation for its new models in order to combat the slowdown and cut costs. The Jazz has a localisation of 77%, the highest among its models. The City and the Accord have localisations of 75% and 35%, respectively. The higher localisation content allowed the company to keep the pricing of the new City competitive and sales have grown 20% since its launch six months ago, said Natsume. However, the rise in the yen and dollar resulted in the pricing being a bit steep for the Jazz than previously planned, said Natsume. “We were adversely affected by the rise in yen and the dollar, as we import parts from Japan and the US,” he said. The car is priced between Rs 7.15 lakh to Rs 7.50 lakh ex-showroom in Bangalore, making it the nation's most expensive ‘super-mini’ car. The company has already seen 1,000 bookings for the car, he said. “We hope the Jazz sales will propel us to a double-digit growth this year,” he said.
Tata Motors set to roll out its crossover SUV next yr
17 June 2009;business-standard.com:Sohini Das:Kolkata: After the Nano and the World Truck, Tata Motors is readying for yet another big-ticket launch. This time, it will be on a ‘crossover’ sports utility vehicle (SUV) platform. The product — which is currently undergoing testing at the Tata Motors European Technical Centre, the company’s research and development (R&D) outfit in UK, and at the Engineering Research Centre (ERC) at Pune — is likely to be launched sometime in 2010. Sources indicated that this could be based on the crossover Tata Xover that was unveiled at the 75th Geneva Auto Show in 2005. A team of around 150 engineers have worked on the product for the last three years. The UK R&D centre which designed the structure of the world’s cheapest car, the Tata Nano, is believed to have made significant contributions to this SUV as well. “For the consumer, the Tata Xover will blend the benefits of a family-friendly luxury tourer with refined driving dynamics and the visual cues of an activity-oriented sports utility vehicle,” a Tata Motors release issued at the time of the Xover unveiling said. The 4.85-meter long Xover can accommodate up to seven passengers and is configured to incorporate a range of Euro-IV engines. The rugged looking SUV is likely to offer a range of features like traction control, climate control and a navigation system, among others. The Xover (or its new avatar) could be Tata Motors’ biggest bet to arrest the falling sales in the utility vehicle space. While its net passenger car sales in May 2009 is down by 11 per cent on a year-on-year basis, its UV-SUV sales dropped by 49 per cent. The company’s cumulative sales in the segment this fiscal is 4,758 units, down by 45 per cent over last year. Currently, Tata Motors has the Sumo and the Safari in the UV-SUV segment. A Tata Motors spokesperson confirmed the ‘crossover’ showcased in the Geneva auto show will be launched in India in 2010. The name will be decided at the time of the launch and the company also plans to export it from India. He did not give any further details. Overall UV-SUV sales have been going down for sometime now. According to data released by the Society of Indian Automobile Manufacturers (SIAM), sales were down by 29.14 per cent in May. The declining UV-SUV market — made up by vehicles that are known to be fuel guzzlers — have even hit the overall passenger car sales’ record this fiscal.
Fiat launches Grande Punto priced at Rs 3.99-6.11 lakh
17 June 2009;timesofindia.indiatimes.com:NEW DELHI: Italian car major Fiat on Wednesday launched its much-awaited premium small car Grande Punto in both petrol and diesel variants in the Indian market, priced between Rs 3.99 lakh and Rs 6.11 lakh (ex-showroom, Delhi). "The launch of Grande Punto marks a new milestone for Fiat in India as we bring the quintessentially Italian designs to Indian shores," Fiat India Automobiles Ltd (FIAL) Chief Executive Officer Rajeev Kapoor told reporters here. The company believes that the small-car segment is under-tapped and customers are increasingly looking forward to international brands on Indian roads, he added. Grande Punto, which was first launched in the European market in 2005, would be rolled out from the company's plant at Ranjangaon in Maharashtra in four variants each in both petrol (1.2 litre an 1.4 litre) and diesel modes (1.3 litre). The petrol variants would cost Rs 3.99-5.61 lakh, while the diesel cars would be offered at Rs 4.85-6.11 lakh. FIAL, a 50:50 joint venture between Italy-based Fiat SpA and domestic auto major Tata Motors, plans to position the car in the premium hatchback segment along with Maruti Suzuki's Ritz, Hyundai's i20, Skoda's Fabia and Honda Siel's Jazz. The company said Grande Punto would be retailed through over 100 Tata-Fiat dealers network across the country. The company's Ranjangaon facility has a production capacity of two lakh cars and three lakh engines per annum. It produces Palio Stile and Linea from the plant.
16 June 2009;business-standard.com:Mumbai:Private sector refiner Essar Oil today hiked prices of petrol and diesel by Rs 1-2.50 a litre and Rs 1-2 a litre respectively as international crude oil prices has risen to a seven-month high of $71 a barrel. Depending on the location of a fuel station, Essar Oil will accordingly sell petrol at between Rs 45.85 to Rs 47.35, while diesel will be sold at between Rs 35.45 to Rs 36.45 in Mumbai, a company official said. However, there will be no hike on fuel retailed in Gujarat owing to proximity to its refinery at Vadinar, the official said. The company till yesterday sold petrol and diesel at rates at par with state-run refiners Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum. Oil PSUs sell petrol at Rs 44.85 per litre in Mumbai and Rs 40.62 per litre in Delhi. Diesel is sold at Rs 34.45 per litre in Mumbai, while the same costs Rs 30.86 per litre in Delhi. The Ruias-led company does not operate any petrol station in Delhi and hence petrol rates for the entire northern region will range from Rs 41.62 to Rs 43.12, the official said. Diesel in the northern states will be sold at between Rs 31.86 to Rs 32.86, he added.
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