Two-wheeler exports from India rise 19.5% in April-January

Source: The Hindu Business Line, Feb 10, 2019

New Delhi: At a time when two-wheeler manufacturers are finding sales moving at a slow pace in the domestic market, their exports have risen by 19.49 per cent in the April-January period this fiscal, according to the latest data from auto industry body SIAM.

Total two-wheeler exports during the period stood at 27,59,935 units as compared with 23,09,805 units a year ago, showed the Society of Indian Automobile Manufacturers (SIAM) data. The growth in exports of two-wheelers from the country is driven mainly by motorcycles and scooters.

Motorcycle shipments to foreign markets during the period stood at 24,12,800 units as against 20,34,250 units in the corresponding period last fiscal, up 18.61 per cent. Likewise, scooter exports zoomed by 26.67 per cent to 3,32,197 units as compared to 2,62,253 units in the year-ago period, SIAM said. Exports of mopeds grew by 12.3 per cent to 14,938 units, against 13,302 units a year ago. Read the rest of this entry »

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New vehicle registration up 8.5% to 1.5 million in January: Dealers

Source: Business Standard, Feb 07, 2019

Chennai: Vehicle registration has increased 8.5 per cent to 1,565,150 in January, from 1,442,514 units in December 2018. This has been mainly due to an uptick in passenger vehicle registrations, even as the commercial vehicle registration was flat.

Passenger vehicle sales reported nearly 33.97 per cent growth, which is almost double compared to the past.

The worrying part is registration of two-wheeler numbers, the bread and butter for a major chunk of dealers, which has been facing pressure due to an increase in inventory levels.

The two-wheeler and three-wheeler registrations have grown 4.25 per cent and 11.86 per cent respectively, according to the Federation of Automobile Dealers Associations (FADA).

FADA’s President, Ashish Harsharaj Kale said, “The inventory of two-wheeler dealers continues to be very high. This puts burden on the dealers, who are already facing problem due to liquidity constraint, high- working capital and others. The association wants the two-wheeler makers to recalibrate the inventory system.”

Automakers staring at production stoppage due to restrictions on steel imports: SIAM

Source: The Hindu Business Line, Jan 14, 2019

Automobile industry body SIAM Monday said vehicle manufacturers are staring at production stoppage if there is no resolution of the issues over restrictions imposed on domestic manufacturers using imported steel.

Last month, the government had extended the deadline for automobile makers to use Bureau of Indian Standards (BIS) certified locally produced high grade steel till February.

The automobile manufacturers had sought a year’s time, expressing their inability to source high grade steel locally soon citing inconsistent quality.

“Yes, our production will get hampered if it is not resolved. We are making representation to the government regarding the matter,” Society of Indian Automobile Manufacturers (SIAM) President Rajan Wadhera told reporters here. Read the rest of this entry »

NBFC liquidity crisis hits India’s auto industry hard

Source: LiveMint.com, Jan 11, 2019

New Delhi: Automakers, hit by the liquidity crisis among non banking financial companies (NBFCs), want the government to take measures to stem the reduction in credit for dealers and customers. The Society of Indian Automobile Manufacturers (Siam), the industry lobby, has written to finance secretary A.N. Jha about the continued decline in sales from the lack of credit. The NBFC crisis was triggered by the crisis at Infrastructure Lending and Financial Services Ltd (IL&FS).

Siam also sought an appointment with Jha to apprise him of the difficulties faced by the auto industry. Separately, Siam—along with the Federation of Automobile Dealers Associations (FADA)—has written to the Finance Industry Development Council, comprising representatives of NBFCs, before they called on the Reserve Bank of India (RBI) governor on Wednesday. Read the rest of this entry »

What’s driving the deal-making frenzy in auto components sector?

Source: LiveMint.com, Jan 06, 2019

Over the last 12 months the auto parts sector has seen heightened funding and acquisition activity, with over 15 transactions in 2018. This is more than double that of 2017. The focus on the sector is driven by strong tail winds driving impressive growth across vehicle segments.

Apart from the speed-bump faced by the sector over the last couple of months, all sub-segments, including passenger vehicles, two wheelers, commercial vehicles and tractors grew at double digits. This is the first time such uniform growth has been seen in a decade.

Additionally, there has been a lot of focus and funding activity in the electric vehicle ecosystem in India.

Robust agrarian growth, increasing consumer preference for premium variants in urban India and successful product launches have supported the positive momentum in the sector. Read the rest of this entry »

Heavy commercial vehicle sales veer off the growth track

Source: LiveMint.com, Dec 05, 2018

The anaemic growth seen in passenger vehicle sales over the last couple of months is now spreading to commercial vehicles (CVs).

The sharp decline in medium and heavy commercial vehicle (M&HCV) sales in November was most glaring compared to other auto segments. Ashok Leyland Ltd’s volumes fell by 18% year-on-year, while those of Tata Motors Ltd contracted 24% year-on-year. Combined with sales of Eicher Motors Ltd, and Mahindra and Mahindra Ltd, M&HCV sales fell 14.6%. The sudden drop is after a strong double-digit growth until October.

According to Bharat Gianani, analyst at Sharekhan Ltd, “M&HCV sales dropped due to the liquidity crunch and impact of higher axle load norms, which led to capacity increase in the system.” This led to volatility in freight rates, at a time when fuel prices were spiralling. To add to this, interest rates were on the rise; and the non-banking financial companies’ crisis curtailed lending to the sector. Read the rest of this entry »

It’s a negative festive surprise for automakers in India

Source: LiveMint.com, Nov 28, 2018

A festive season that lacked sparkle for domestic automobile sales has raised alarm bells among investors. During the 42-day festive period, registrations of vehicles in the domestic market—an indicator of retail sales and consumer sentiment—was down by as much as 11% year-on-year, according to data from analytics firm Crisil Ltd. Passenger vehicles displayed the sharpest decline of 14% in registrations. What’s worrisome is that it is normally a peak period for new vehicle registrations in the country. Worse, the decline comes on the heels of sales contraction in the three months of July, August and September. Read the rest of this entry »