15 July 2011;deccanherald.com:Bangalore/New Delhi: Karnataka is closer to having India’s next uranium mine as Chief Minister B S Yeddyurappa approved mining at Gogi village in Yadgir district’s Shahapur taluk on Thursday. The approval comes after nearly four years of exploration in the area. The uranium mine will have a life of 15 years during which it will supply fuel to nuclear power plants in southern India. Though the approval by the state government’s High Level Clearance Committee (HLCC) brings the project closer to implementation, it still needs to get clearance from Union Ministry of Environment and Forestry before Uranium Corporation of India Ltd can carry out commercial mining and set up processing mills. “The total deposit of uranium oxide is 4,250 tonnes. It’s a high grade deposit with 0.1 per cent uranium. This is as good as the deposit in Meghalaya. In comparison the ore in Jadugoda (Jharkhand) is inferior with only 0.05-0.06 per cent uranium,” a senior official in the department of atomic energy who does not wished to be named, told Deccan Herald. The mine and mills, which would be spread over 40 hectares, had been opposed by local residents and elected representatives who feared it would cause health hazards. When the issue was raised in the recent State Legislature session, Yeddyurappa assured that the government would take the decision on approving the project only after confirming that the uranium mining would not create any health problems to the local population. During the public hearing conducted by Karnataka State Pollution Control Board on November 16, 2010, residents of Gogi and four nearby villages demanded construction of a water treatment plant and electricity supply, which were agreed by UCIL. The report of the public hearing was submitted to the MoEF, which subsequently asked for more documentation from the UCIL. “Our application is pending. We are awaiting the MoEF approval,” said a spokesperson from the department of atomic energy from Mumbai. Centre’s nod The UCIL had obtained the Centre's permission to conduct exploratory mine in 2007. Initial processing of the ore will be done at a plant to be set up at a village six km from the mining area of Gogi, official sources said. If it becomes operational within the next few months – which the department of atomic energy is hoping for – it would be a boon for the nuclear sector as mining at Domiasiat in Meghalaya has stalled for years due to stiff opposition from local political parties and activists. Uranium mining at Cuddapah district of Andhra Pradesh is also in limbo at the moment due to opposition from local people and voluntary organisations. “A second public hearing would have to be held at Cuddapah,” said a DAE official. Shortage of uranium fuel has been a serious issue for Indian nuclear sector, which is hoping to achieve 20,000 MW capacity by 2020. Despite imports helping to keep the plants going, steady domestic supply of nuclear fuel is essential for many of them to run in their full capacity.
15 July 2011;timesofindia.indiatimes.com:NEW DELHI: Ford drove in the international Fiesta sedan in India on Thursday with an entry price of Rs 8.23 lakh (ex-showroom Delhi), significantly higher than rivals like Honda City, Hyundai Verna and Volkswagen Vento. The US car major has seen a revival of sorts in India after the launch the Figo last year. It is counting on the new car to up its stake in the lucrative but highly competitive premium sedan segment, which has seen a flurry of new launches in recent times. Fiesta is the first of the eight new global models that Ford has promised to roll out by 2015. It sports a 1500cc engine in both petrol and diesel variants. The entry-level diesel variant will cost Rs 9.27 lakh (Delhi ex-showroom). Michael Boneham, MD of Ford India, told TOI that he was not worried about the price gap against rivals. "It is not about price, but about the product. The Fiesta offers features like anti-lock braking system (ABS), airbags and steering wheel audio controls as standard across variants," Boneham said. However, rival brands like Honda also offer the features as standard while in others they are available at a lower price. The premium sedan segment has seen competition hotting up of late and changes in the dynamics. The Honda City, once the leader of the pack, has been under tremendous pressure following the entry of models like Vento and the new Verna, forcing the company to go in for a Rs 66,000 price cut last month. The competition will make things difficult for Ford. The US major is already witnessing a pressure in the demand for the Figo as slowdown hits the market and competitors like Maruti, Hyundai and Toyota catch up. The Figo, the volume-driver for the company, saw volumes dip 6% in the first quarter of this fiscal at 17,319 units against 18,495 units in the corresponding quarter in 2010-11, according to figures released by Society of Indian Automobile Manufacturers (SIAM). Boneham said he was not too worried about the slowdown in demand in the market and for Figo. "While factors like high interest rates and scarcity of cash have put pressure on the demand in the car market, we are still forecast to grow by 12-14%, which is absolutely not bad. On Figo, we have some production constraints on the diesel engines. In any case, the model is also being exported and we are doing well internationally." Refusing to forecast the company's sales targets, Boneham said Ford was bullish on India and was on course to bring in new models in the market.
Honda, Maruti, Hyundai offer discounts & freebies to spur car sales
Wednesday, 13 July 2011
14 July 2011;economictimes.indiatimes.com:Chanchal Pal Chauhan:NEW DELHI: Carmakers are offering the best discounts and freebies in two years on almost all vehicles to woo customers back to showrooms and regain momentum after sales growth slowed to a crawling 1.6% in June. Honda set the mood with a stunning Rs 1.7 lakh limited-period waiver on its struggling hatchback Honda Jazz on Monday, while market leader Maruti Suzuki offers rebates of more than Rs 50,000 on Alto, WagonR and Estilo that together account for half its sales. "We are just reacting to the market. Retail sales have taken a hit with a huge slump in customer's responses. To maintain our sales tempo, we have maximized the benefits on high selling models like Alto and WagonR in July as overall sales had turned negative in June," Maruti's chief general manager (marketing) Shashank Srivastava said. After growing a breakneck 30% last fiscal on the back of a 26% gain in 2009-10, the Indian car market started a slowdown in April amid rising loan rates and higher fuel prices and hit a 26-month low in June. Now there seems to be a discount war. Carmakers are following the international trend of charging lower interest rates on auto loans as part of the discount. Interest rates have increased by up to 300 basis points in one year due to the central bank's policy rate hikes to control inflation. Volkswagen is offering loans at 6.99% interest rate on its Vento petrol sedan, while luxury carmakers Mercedes and Audi are offering zero interest loans on C Class sedan and Audi A4 sedan, respectively. "The companies are tying to structure deals to bring down the total cost for the customers through direct rebates or discounted interest rates to cut their piled up stocks," a Mumbaibased banker said. "With a possibility of interest rates rising in coming months, we expect the discount regime to continue till September and beyond the festive season," added the person, requesting anonymity. Some Honda Siel officials and dealers, meanwhile, said the company wants to clear the inventory of the current Jazz model with this steep discount offer and that it will launch a face-lifted version of the premium hatch soon. Jazz could not match its rivals Hyundai i20, Maruti Swift and Volkswagen Polo in sales mostly because of its premium pricing of more than Rs 7 lakh. Its sales dipped 39% in the April-June quarter to 643 cars, down from 1,050 sales a year earlier. Honda Siel is also offering Rs 50,000 discount on its top-selling City sedan on top of last month's Rs 66,000 price cut as car companies work overtime to revive sales. Hyundai Motor India offers up to Rs 45,000 discount on its popular i10 and Santro compact cars. The firm also offers a discount on its petrol cars to compensate for the price difference between petrol and diesel for one year. Fiat has offered an option to buy a diesel car in place of a petrol car, and the benefit of Rs 1 lakh is given to customers.
Auto steel makers face pressure as car demand withers
Wednesday, 13 July 2011
14 July 2011;business-standard.com:Shubhashish:Mumbai: Auto-grade steelmakers in the country have started to feel the pinch of dwindling car sales. The outlook is cautious and the steel manufacturers are staring at a drop in demand from automakers. Ankit Miglani, deputy managing director, Uttam Galva, a leading auto and white goods steelmaker in India, said, “Sales volumes have dropped and prices have bottomed out, too. The drop in demand and lower steel prices will reflect in the second-quarter numbers, as the effect will be fully factored in by then.” Essar Steel CEO Malay Mukherjee said the auto-grade variety forms just 7-8 per cent of the total steel demand in the country. However, he agreed that there was indeed a fall in the demand for steel from automakers. “Given that it’s less than 10 per cent of the total steel demand in India, the impact will be marginal on us,” he said. According to the latest data made available by the Society of Indian Automobile Manufacturers (SIAM), sales growth in the passenger vehicles segment came down to just 8.8 per cent to 601,547 units in the first three months of 2011-12, as compared to 29 per cent in the same period of last year. SIAM had forecast this segment would grow at 16-18 per cent, which was revised downwards to 10-12 per cent. The overall growth for the auto sector is also lowered to 11-13 per cent from an earlier indication of 12-15 per cent. “We have seen explosive growth in the auto sector over the past times and clearly that cannot continue. However, it will still be the growth driver for steelmakers as it pushes the companies for better innovations, etc,” Mukherjee added. The issues that plague the auto sales and hence, the steel sales, are similar. SIAM President Pawan Goenka had pointed out the rising interest rates and the recent increases in fuel prices as the culprit for the moderation in auto demand. An official from a steelmaker who wished not to be identified said, “The demand for auto-grade steel is slowing down since the beginning of the current financial year and this is affecting the steel consumption drastically,“ adding, “the low demand from auto companies is expected to continue for the next quarter or so.” The official further said the falling demand for auto-grade steel had put pressure on the steel consumption and prices. An official from another steel company, talking on behalf of the industry, said, “The inventories of finished auto-grade steel are very high. Also, the cost of raw materials used by the steel companies to make this variety are relatively high.” Miglani said that the market, according to him, has bottomed out. He said, “Steelmakers are already producing at cost levels and any further drop in demand will warrant production cuts.”
14 July 2011;business-standard.com:Swaraj Baggonkar:Mumbai: Lower than expected volumes growth, owing to weakened demand and high raw material prices, is likely to impact margins of automotive companies in the first quarter of 2011. Revenue growth, however, is expected to be better on account of an upward price revision by companies during the quarter, according to analysts reports. Net profit of the sector is expected to grow by around 10-12 per cent over the same period a year ago, while gross revenue is expected to record a growth of 16-18 per cent. Chennai-based truck and bus maker Ashok Leyland, which recorded a fall of nearly 10 per cent in volumes, may post the biggest fall in net profit among all other vehicle makers. Ashok Leyland, the second biggest commercial vehicle maker, reported a fall of 11 per cent at 19,277 units as against 21,400 units. Volumes of car market leader Maruti Suzuki remained flat in the same quarter as exports fell and buyers preferred to hold back their purchases due to high fuel prices and costlier lending rates in the domestic market. Maruti Suzuki recorded total volumes of 281,256 units, a fall of 0.6 per cent during the quarter, compared to 283,324 units in the year-ago period. While the car and commercial vehicle markets suffered due to macro economic fluctuations, the two-wheeler sector largely remained insulated as buyers moved to fuel-efficient motorcycles to beat the price hike. Most companies raised prices by 1-2 per cent on account of rise in prices of steel, rubber and other metals, however, they have refrained from passing on the entire burden to the customer. A senior executive from Bajaj Auto said the company was holding on to the price rise because they had increased the prices of their vehicles in April for the domestic market and in May for exports. Bajaj will announce their Q1 results on Thursday. "Rising inflationary pressure, higher interest rates and slower economic growth have led to slower growth for cars and commercial vehicles in Q1. But the domestic two-wheeler industry seems insulated from the prevailing tough macro conditions", said a report of Standard Chartered equity research. “Volume growth has been muted across key segments for this quarter, in addition, sustained cost pressures will continue to see a fall in operating margins. Overall we expect the auto space to post a subdued performance at the net income level,” said a Morgan Stanley report.
13 July 2011;deccanherald.com:Panaji: General Motors India is looking to enhance its range of diesel-driven cars as demand for the variant increases due to the price difference with petrol. The company, which is set to launch the diesel variant of its compact car Beat this month, is keeping its options open to introduce similar variants of other models as well. “There is always a possibility of extending the diesel option to what customers demand,” GM India President and MD Karl Slym said, responding to a query on whether the company will introduce a diesel variant of its small car Spark.
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