17 Feb 2010;dailypioneer.com:Rakesh Bihari Jha:New Delhi: US car maker Ford, which is all set to join volume segment in India with its small car ‘Figo’, will phase out its hatchback ‘Fusion’. “We will discontinue the Fusion...The car was anyway giving us relatively small volumes,” said Ford India Managing Director and President Michael Boneham, adding, “the company will focus on small car Figo, which will be launched in March.” In a very bold move, Ford on Tuesday opened 28 dealerships across 24 cities in the country, as it is getting fully prepared to cope up with the anticipated high demand of its small car Figo. The Figo will feature a standard 1.2-litre engine and will be available in the 1.4-litre diesel engine as well. New facilities have been opened in New Delhi, Sangrur, Haldwani and Gwalior in the North; Durgapur, Dhanbad and Guwahati in the East; Hyderabad, Chennai, Warangal, Vellore, Salem, Vijayawada and Malappuram in the South; and Bilaspur and Mehsana in the Western region. “We will increase our network further by 15-20 per cent this year and we have an aggressive growth strategy in Tier II and III cities,” Boneham said. Ahead of the launch, Ford has added new dealers to take the total to 164, across 97 cities. “With the openings today, 40 per cent of our dealers are now in secondary markets and we will further increase it,” he added. The commercial production of Figo has started at the Ford’s Chennai plant from February 5. The plant has a capacity to produce 2,00,000 units annually. The Chennai facility will produce both petrol and diesel engines in a flexible assembly line, along with four cylinder engines with capacities varying up to 1.6-litre for export. When asked about what is the outlook for the company this year, he said: “We will have significant growth this year also and the company hopes to grow in the range of 15-20 per cent.”
16 Feb 2010;hindustantimes.com:Anupama Airy:New Delhi: The country's largest fuel retailer Indian Oil Corporation (IOC) is planning to open 24-hour C-stores (convenience stores) at its petrol pumps. With the largest network of 18,700 petrol pumps across the country, Indian Oil Corporation (IOC) says it wants to expand its foot prints into organised retail. The oil company has entered into a pact with K.K. Modi’s Godfrey Phillips for opening such C-stores in northern India. “This is our beginning in organised retail,” said IOC’s chairman and managing director, Sarthak Behuria. “So far we had a loose structure with individual tie-ups with banks or mobile operators and restaurants,” he added. “We are now beginning to look at tie-ups with companies that already have a presence in the retail side. Godfrey Philips is already operating an extensive retail format in Delhi under the brand Twenty Four Seven.” In the first phase, 100 such C-stores will be opened in major cities of North India. “We will enter into similar tie-ups with other retail chains for other regions of the country.” These stores will stock a range of consumer goods including ready to eat foods, music, magazines and would even offer movie tickets. On how different will these stores be from the existing ones, Behuria said, “There aren’t many stores offering round-the-clock service. We have undertaken studies that have shown that there exists a large clientele who wants such service beyond 10 pm.”
17 Feb 2010;economictimes.indiatimes.com:DETROIT: Ford Motor Co said on Tuesday that it plans to cut 900 workers at the Michigan plant that makes the Mustang, after slow sales last year due to the tough economy and competition from the new Chevrolet Camaro. Ford will reduce shifts from two to one in July at the AutoAlliance International plant in Flat Rock, Michigan. The plant, which is jointly owned with Mazda Motor Corp, also makes the Mazda6 midsize sedan. The plant employs nearly 2,300 people. Most of the layoffs will be hourly manufacturing workers, but some salaried staff also will be cut, Ford spokeswoman Marcey Evans said. Evans said there was significant down time at the plant last year and Ford can get the volume it needs from one shift. Mustang sales fell 27 percent last year, in part because of competition from the Camaro, which went on sale in the spring and came within 5,000 cars of outselling the Mustang. The Camaro hasn't outsold the Mustang since 1985. Mazda6 sales were down 34 percent. Evans says a majority of the workers will be offered positions at other plants. Ford said last month it will hire 1,200 workers at its Chicago Assembly Plant to build the new Ford Explorer. Explorer production will start at the end of this year. Ford also recently announced a plan to create 1,000 jobs in Michigan to make electric car batteries. Evans said the company also needs workers at the Michigan Assembly Plant in Wayne, Michigan, which is scheduled to begin producing the new Ford Focus later this year. Ford currently has around 600 workers on indefinite layoff in the US Those workers and the ones to be laid off at Flat Rock will have the first opportunity to take jobs at facilities that are hiring. The company has been trying to thin the ranks of hourly workers, most recently offering buyout packages to all 41,000 US hourly workers in December. Around 1,000 workers took similar buyout offers last year.
15 Feb 2010;economictimes.indiatimes.com:Rajeev Jayaswal & Subhash Narayan: NEW DELHI: Country’s only international fuel retailer Shell India has silently ramped up its petrol pump network to 74, a 50% jump in just one year, even as other private retailers fret about the lack of level playing field in the retailing business between the private players and government-owned companies. After getting a licence to open 2,000 retail outlets in India in 2004, Shell opened only 50-odd pumps in over four years, citing predatory pricing by state-owned competitors — Indian Oil (IOC), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL). A Shell official confirmed that the company has increased the number outlets and said Shell India has aggressive expansion plans. “We have 74 (retail outlets) up and running. A few more are in the process of commissioning,” the official, who did not wish to be named, said. Petrol and diesel sold at Shell pumps are costlier by Rs 2-5 a litre (depending on the location), compared with those sold at a public sector fuel station. It could not be ascertained whether Shell India has achieved break-even in its fuel retail business. The privately-held company declined to reveal its accounts and other details. The company, which does not have a refinery in the country, buys petrol and diesel from Mangalore Refinery & Petrochemicals (MRPL) and sells through its pumps. “The company’s retail operation is running on reputation. As fuel retailer, it is the best in the country,” an oil sector expert and CEO of a private-sector refinery said requesting anonymity. Shell India’s growth is in sharp contrast to Reliance Industries’ (RIL) fuel retail business. “Only 600 pumps of RIL are functional today, mainly in Rajasthan, West and South India,” a company official said on condition of anonymity. At present, the company has about 1,400 retail outlets, he added. Interestingly, another private sector company Essar Oil is planning to nearly double its retail network. “We are going to increase (number of petrol pumps) to 2,500 by next fiscal (end),” Essar group chairman Shashi Ruia said in Delhi recently. “It is likely that the private oil companies are expanding their retail business in hope that the government will soon deregulate pricing of auto fuel,” an official in IOC said. All the three private firms declined to comment on this issue. The government is expected to take a decision on freeing prices of petrol and diesel by Sunday or next week, a senior official in the oil ministry said. “I have submitted a memorandum (regarding pricing of petrol, diesel, kerosene and cooking gas) to the Prime Minister and the finance minister,” oil minister Murli Deora said. “We have also requested them (PM and FM) to compensate PSU oil companies the shortfall on account of SKO (kerosene) and LPG (cooking gas) for the current fiscal,” he said. The finance ministry has paid a cash compensation of Rs 12,000 crore to public sector oil retailers for the entire financial year, leaving a gap of around Rs 19,000 crore in their books.
15 Feb 2010;dailypioneer.com:New Delhi: Stating that the auto industry is yet to come out of the woods despite clocking record breaking sales in January, vehicle makers have asked the Government to continue the stimulus package provided during the economic downturn in the upcoming Budget. The country’s largest car maker Maruti Suzuki India (MSI) said policies that helped the auto industry grow at about 21 per cent in the last 12 months should be continued. “It will be too early to exit from stimulus measures as those were the main reasons of growth for the industry. It is too early to say that the auto industry has fully recovered (from the slump due to global economic crisis),” MSI Executive Officer Marketing and Sales Mayank Pareekh said. According to Society of Indian Automobile Manufacturers (SIAM), total vehicle sales of 11,14,157 units, in India in January was at the highest ever sold in a month. Car sales were also at record high of 1,45,905 units. It was the 10th straight month of growth by the segment. The good numbers notwithstanding, Mahindra & Mahindra Vice-Chairman Anand Mahindra said the Government should be very careful on any withdrawal of stimulus packages. “It was not a very overwhelmingly large one like in China or in the US. It is a very very measured package.”The Government had cut CENVAT by 4 per cent in December 2008 that resulted price reduction of automobiles and helped in spurring demand. Besides, States were encouraged to buy more buses for urban transport that gave a fillip to the commercial vehicles segment. General Motors India also felt that the industry is yet to see concrete signs of recovery from the battering it received during 2008-09. Support for continuation of the stimulus package has also come from the auto component manufacturing segment with the industry body, ACMA asking the Government to continue with the status quo. “Stimulus should not be removed in the immediate future. Although total auto sales may have zoomed, the commercial vehicle segment has still not fully recovered and exports are also below earlier high figures,” ACMA Executive Director Vishnu Mathur said.
14 Feb 2010;business-standard.com:New Delhi: Facing opposition from key allies in the UPA government, Finance Minister Pranab Mukherjee and Oil Minister Murli Deora today discussed an "all-acceptable" hike in fuel prices but it appeared the two failed to reach a consensus and the fuel price hike may not happen immediately. "No decision has been taken," Deora told reporters after an hour-long meeting. PSU retailers are projected to lose Rs 45,571 crore on selling petrol, diesel, domestic LPG and kerosene below cost. To avert bankruptcy, the Kirit Parikh panel has suggested freeing auto fuels from government control along with a steep hike in cooking fuel. Last week, Deora's ministry did not take the proposal to free petrol prices, along with hikes in diesel, cooking gas and kerosene rates, to the Cabinet because of opposition from the Trinamool Congress and the DMK. "The meeting was about under-recoveries (revenue losses) of oil marketing companies and their Kirit Parikh report. No decision has been taken," Oil Secretary S Sundareshan said. Pending a decision, Deora wanted the government to fulfil its promise of meeting the Rs 31,574 crore revenue Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) will lose on selling domestic LPG and kerosene below cost. However, Mukherjee made no promise of giving anything more than the Rs 12,000 crore already promised, sources said adding the meeting could not decide what could be an acceptable price hike to all constituents of the ruling UPA. IOC, BPCL and HPCL currently sell petrol at a loss of Rs 4.72 a litre, diesel at Rs 2.33 per litre, kerosene at Rs 18.06 per litre and domestic LPG at Rs 287.59 per cylinder. Deora, sources said, was of the opinion that any moderate price increase would help curtail revenue losses of the future but the government must urgently decide on the losses that have already been incurred this fiscal. In July last year, it was decided that the government will meet all of the revenues retailers lose on LPG and kerosene and the same on petrol and diesel would be made good by upstream firms like ONGC. The Rs 13,997 crore revenue loss on auto fuels was being made good but issues remained with the losses on LPG and kerosene. Deora had on February 11 submitted a memorandum to the Prime Minister asking the Government to cover the unmet Rs 19,574 crore revenue loss on LPG and kerosene sale. Today's meeting with the Finance Minister took that forward but no decision was reached. Sources said both Mukherjee and Deora were in favour of Rs 2-3 a litre hike in petrol and diesel prices and Rs 25 per cylinder increase in LPG rates, but the allies did not want diesel, LPG and kerosene prices to be touched. Owing to this, the two ministers deferred a decision pending more consultations within the ruling UPA, they said. The proposal of free petrol prices would lead to a price increase of Rs 4.72 a litre. A similar move on diesel, as suggested by the expert group on pricing reforms headed by Kirit Parikh, would have resulted in rates going up by Rs 2.33 a litre. Sources said the Petroleum ministry was willing to settle for Re 1 a litre increase in diesel rates provided, LPG and kerosene prices were also raised. The increase sought will, however, not be in the range of the steep Rs 100 per cylinder and Rs 6 a litre hike, respectively, suggested by the expert group. Sources said the ministry is bargaining for at least half of the price increase suggested by the panel, but may settle at Rs 25 per cylinder hike in LPG rates and Re 1 a litre raise in kerosene prices. Petrol is currently sold at a loss of Rs 4.72 a litre, diesel at Rs 2.33 per litre, kerosene at Rs 18.06 per litre and domestic LPG at a discount of Rs 287.59 per cylinder. In case the government goes for marginal hikes, the Cabinet will also have to decide on how the remaining revenue loss would be met.
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