27 Dec 2008;business-standard.com:Mumbai: The new Honda City has won the Business Standard Motoring Car Of The Year 2009 title. Other contenders this year for the top honours were the Maruti Suzuki A-Star, Hyundai i20, Toyota Corolla Altis, Volkswagen Jetta, Skoda Fabia and the Tata Indica Vista. All new cars launched in calendar year 2008 qualify for the Car Of The Year awards.
The City wrested the title from the rest of the finalists by raising the benchmark in its class across all aspects, be it performance, safety, comfort, driving dynamics, fuel consumption and design. The A-Star was first runner-up and in third place was the i20.* The voting system has been changed from this year onwards and follows the European and Indian Car Of The Year evaluation format. The previous BS Motoring COTY points system which ran for a decade was skewed towards a low price of acquisition and low running costs. To reflect the changing market dynamics in the country and increased awareness levels of prospective car buyers, the new voting system favours new-age technology, environment friendliness and more importantly, safety. However, the fitness for purpose for which each car in each segment was conceived, designed and developed was considered by the jury.
Business Standard Motoring award winners for 2009 include the refreshingly new and cost-effective Yamaha FZ16 as the Bike Of The Year.
The all-new Audi A4, with a slew of engines, won the Premium Car Of The Year award, while the path-breaking small car from Maruti Suzuki, the A-Star, was adjudged as the Best Value. The Chevrolet Captiva, which won many a heart for its economical diesel engine and SUV virtues, got the Import Car Of The Year honours. The six-member jury thought the new Tata Indica Vista was a tremendous step in the right direction by an indigenous car maker and bestowed it the Jury award.
Business Standard Motoring awards are the oldest automotive honours in the country and they have been continuously announced since 1996, when the Mercedes-Benz E-Class (W124) won the title. Previous Business Standard Motoring Cars Of The Year include the Hyundai i10 (2008), Chevrolet Aveo U-VA (2007), Maruti Suzuki Swift (2006), Hyundai Getz (2005) and Honda City (2004).
* The i20 will be launched on Monday and was made available to the BS Motoring team for test run a week ago
26 Dec 2008;business-standard.com:New Delhi: State-run oil refiners are likely to report profits on daily sale of petrol, diesel, cooking gas and kerosene in the fortnight ending December 31, after average crude oil prices have been nearly 3 per cent lower and the rupee has appreciated 3.2 per cent compared with the first fortnight of this month.
This profit is, however, not likely to result in overall profits in the third quarter ending December 31, 2008, for Indian Oil, Bharat Petroleum, and Hindustan Petroleum, as margins from their refineries are lower and, volatile crude oil prices have resulted in high inventory losses.
The three companies are likely to see their profits on petrol and diesel rise and their losses on cooking gas and kerosene fall this fortnight, which will result in the companies making profits on their fuel sales on a net basis.
Indian Oil, which supplies over half the fuels the country consumes, reported daily losses of Rs 6 crore in the first fortnight of December, down from Rs 25 crore after fuel prices were cut on December 5. The company was making a profit of Rs 11.48 on every litre of petrol and Rs 2.92 on every litre of diesel, it sold in the first fortnight of this month. It was making a loss of Rs 17.26 on every litre of kerosene and Rs 148 on every cylinder of cooking gas.
The three companies were together losing around Rs 10 crore on fuel sales in the first fortnight of December.
“On a net basis, we could make daily profits as gains from petrol and diesel sales are expected to be higher than losses from kerosene and diesel,” said a senior IndianOil official. “But, we still have to deal with the accumulated losses for the earlier part of this year.”
As crude oil prices rose 25 per cent between April and July this financial year, and the rupee depreciated 6.29 per cent against the US dollar, the under-realisations of the oil companies rose to around Rs 245,000 crore from around Rs 100,000 crore for the full financial year. Prices have since tumbled by over 70 per cent, bringing down the projected under-realisations of these three companies to Rs 110,000 crore for this financial year.
“Oil prices have fallen, but the rupee has continued to depreciate. That has negated much of the impact of lower oil prices,” said a Mumbai-based analyst.
The rupee has depreciated 15.62 per cent between August and December 24. Fall of $1 on on every barrel of crude oil prices decreases annual under-realisations of the oil companies by around Rs 3,000 crore while every Re 1 depreciation of the Indian currency against the US dollar increases annual under-realisations by around Rs 7,000 crore.
IndianOil, Bharat Petroleum and Hindustan Petroleum are, however, likely to continue making losses on kerosene and cooking gas sales despite the fall in oil prices. “Nowhere in the world is kerosene sold at Rs 9 a litre. For us to start making profits on that, oil prices have to fall drastically,” said another IOC official. The oil companies, however, are expected to post losses in the third quarter ending December 31, 2008, as a result of high inventory losses and interest payouts arising from loans they had to take to meet their working capital needs.
Total borrowings at the end of November 2008 stood at Rs 115,000 crore which would result in interest payout of Rs 8,100 crore during the year, Minister of State for Oil & Gas Dinsha Patel told Parliament on Tuesday.
26 Dec 2008;business-standard.com:New Delhi: Public sector oil firm executives will strike work indefinitely from January 7 against the “minuscule wage hikes” approved by the Government.
The strike may cripple fuel supplies and do irreparable damage to oilwells as executives said the government had “betrayed their trust” while approving the wage hike last month.
The Oil Sector Officers Association, an amalgamation of officers’ unions of 14 state-run oil firms, said the wage hike approved by the Government last month worked out to Rs 3,989 per month at the entry level and Rs 2,217 at the highest level.
“We have been left with no option but to resort to a strike because of a series of betrayals. We have time and again been told that our demands were being considered but the end result is there for all to see,” OSOA President Amit Kumar said.
The government has hoodwinked the public by saying the hike was up to 200 per cent but in effect the increase was only 17 per cent, according to the association. The hike that is being talked about is at the basic pay level and when calculated after merging dearness allowance (DA), the net pay hike was minuscule, the association added.
Kumar said the Government is citing economic recession as an excuse to deny appropriate wage hikes. “But will they consider revising pay scales when the economy turns around in one to one and a half years? No. Our wages will be fixed for the next 10 years.”
The new wages are to be effective from January 2007 and “the arrears that I will be entitled to are only Rs 8,435 as the net increase is minimal”, Kumar said.
PSUs that have a paying capacity like the ones in the oil sector had sought to be grouped in the ‘A+’ category so that their wages can be decided in accordance with their profitability. But the Government turned down even this demand.
25 Dec 2008;business-standard.com:Kalpana Pathak:Mumbai: State-run oil marketing companies (OMCs) are planning to put expansion of their retail outlets back on track as lower international crude oil prices have enabled them to register profits on most of the petroleum products they sell.
The three OMCs — Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) — were in July 2008 asked by the government to stop “indiscriminate” setting up of petrol pumps as it was one of the reasons for mounting losses on fuel sales.
IOC, BPCL and HPCL currently own about 37,000 fuel stations in the country.
“We reviewed the directive a month ago and asked the OMCs to consult their board of directors before they plan to set up retail outlets. The government never restricted the OMCs from setting up petrol pumps,” said RS Pandey, secretary, Ministry of Petroleum and Natural Gas.
The OMCs incur a loss on the sale of petroleum products as they sell them at controlled prices. But with international crude oil prices dipping 69 per cent from an all-time high of $147 a barrel in July to under $45 a barrel, the companies’ margins on petrol and diesel sales have turned positive.
After the recent fuel price cut on December 6 — petrol by Rs 5 a litre and diesel by Rs 2 — the OMCs are making a profit of Rs 11.48 on petrol and Rs 2.92 on diesel. In November, however, the companies were making a profit of Rs 14.89 a litre on petrol and Rs 3.03 a litre on diesel.
“The matter of allowing OMCs to set up petrol pumps was reviewed some time back and the decision to open new outlets has been left to the companies. The location of the new outlets, however, will depend on where the potential lies,” said GD Daga, director (marketing), IOC.
This fiscal, IOC plans to roll out around 300 retail outlets. “We have to look at the potential areas where it makes sense for us to be present. We have thus opened less number of outlets this year,” added Daga.
IOC spends around Rs 50 lakh on setting up a retail outlet in an urban area and around Rs 8 lakh on a rural area pump.
HPCL, on the other hand, plans to focus only on the rural segment. “We are very selective about the locations we plan to be in. While this year we do not plan to open any retail outlet, next year we will open around 200,” said Roy Choudhary, director (marketing), HPCL.
HPCL shells out around Rs 3 crore for setting up a retail outlet in an urban area and Rs 25 lakh to build an outlet in a rural area.
The second-largest oil marketing company, BPCL, has commissioned 67 outlets this year so far and is planning around 550 in the next fiscal. However, the company said all depended on factors like financial situation and board approvals.
25 Dec 2008;timesofindia.indiatimes.com:Pankaj Doval:NEW DELHI: Big discounts on cars may soon be a thing of the past, as companies look set to increase prices in the new year. Price hikes are unlikely
to be hefty,however. The entire spectrum of cars is currently available at attractive deals, with companies offering sweet year-end discounts, which got even better after a 4% cut in excise duty.
Officials of many companies, including Maruti and Hyundai, said some discounts are certainly on their way out in the new year. Toyota said it would increase prices from January 1. While the multi-utility Innova would be dearer by Rs 10,000 to Rs 25,000, the Corolla Altis would cost Rs 16,000 to Rs 25,000 more.
``Due to circumstances beyond our control, like the rupee-dollar exchange rate over the last three months, we have been forced to increase the price of our vehicles. However, Toyota Kirloskar has tried to absorb the price increase as much as possible, limiting the increase to the customer,'' the company's deputy managing director Sandeep Singh said.
The weakening of the rupee has made imports expensive, especially of models that do not have high local content. Many companies source key raw materials, including steel, from abroad, and prices have been affected by the weakening currency. Officials said pressure on costs was ``very heavy'', despite the softening in commodity prices.
Mayank Pareek, marketing executive officer at Maruti Suzuki, said the company was contemplating a hike. ``We are considering it,'' is all he said. A spokesperson for Hyundai also said a price revision in January was ``certainly a possibility.''
A senior Ford official also said prices would ``definitely'' go up in the new year. ``Prices would be raised, though we are yet to identify the model and the quantum,'' a company spokesperson added. Honda plans to hike the price of its CR-V model by Rs 1 lakh.
Some analysts, however, say that companies are talking about price hikes from January only to push sales in December. ``These are mere marketing gimmicks that companies adopt almost every year to help December sales,'' an industry analyst said.
However, a senior official in one of the big car companies said companies were `genuinely' in bad shape, as they had absorbed most of the increased costs throughout 2008, which was one of the worst years for sales. ``Our margins are constantly depleting and have fallen to single digits. Moreover, the sluggishness in the market meant that we pass only a bare minimum to customers while absorbing most of the costs. Therefore, a hike is certainly warranted,'' the official said.
24 Dec 2008;hindustantimes.com:Singapore: Oil prices were steady near $39 a barrel on Wednesday in Asia as investors digested more bad economic news from the US in thin Christmas Eve trading.
Light, sweet crude for February delivery dipped 9 cents to $38.89 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore. The contract fell overnight 93 cents to settle at $38.98.
A steady stream of dismal US economic and corporate news during the last few months has hammered investor confidence and sent oil prices reeling 74 percent since July.
More bad news emerged Tuesday as the Commerce Department said sales of new homes fell in November to the slowest pace in nearly 18 years, while new home prices dropped by the biggest amount in eight months.
The department also said that the gross domestic product, the broadest measure of economic health, declined at an annual rate of 0.5 per cent in the July to September quarter.
Some economists believe the US economy's decline in the October to December period could be as large as 6 per cent. If so, that would be the worst quarterly drop since 1982.
Investors will be watching for more evidence of slowing US demand in the weekly oil inventories report to be released Wednesday by the US Energy Department's Energy Information Administration. The report is expected to show that oil stocks rose 1.5 million barrels last week, according to the average of estimates in a survey of analysts by Platts, the energy information arm of McGraw Hill Cos.
The Platts survey also projects that gasoline inventories increased 900,000 barrels and distillates gained 1.4 million barrels last week.
Traders have so far brushed off attempts by OPEC to boost prices through production cuts. The Organization of Petroleum Exporting Countries, which accounts for about 40 percent of global supply, said last week it would slash production by 2.2 million barrels a day, its largest cutback ever, adding to a 1.5 million output quotas reduction in November.
OPEC leaders, including President Chakib Khelil, have said OPEC may meet in Kuwait City on Jan 19 to discuss further production cuts. The group's next official meeting is March 15 in Vienna. In other Nymex trading, gasoline futures rose 0.7 cent to 86 cents a gallon. Heating oil gained 0.5 cent to $1.33 a gallon while natural gas for January delivery was steady at $5.74 per 1,000 cubic feet.
