Unsure Motown shelves $3 billion capex plans

Source: The Economic Times, Nov 12, 2019

MUMBAI: Automakers and their vendors have slashed or deferred nearly $3 billion of expansion plans for the current financial year as a deepening slowdown in the industry shows no signs of improving. Despite retail sales growing for the second consecutive month in October and a pickup in wholesale numbers month-onmonth, auto makers are apprehensive about prospects for the remaining five months of FY20.

Maruti’s parent Suzuki Motor Corporation has deferred its $550-million third plant in Gujarat while Honda Motorcycle and Scooter India has pushed back plans to commence 20191113-2production from its third manufacturing line in Gujarat. Suzuki Motorcycle India has also put off by a few years its proposal to set up a second plant.

Tata Motors and Ashok Leyland, the country’s top manufacturers of commercial vehicles, have scaled back capex plans for FY20 by Rs 500 crore each. Mahindra & Mahindra has cut investment plans by Rs 250-300 crore so far in FY20.

‘Focus on ensuring ecosystem viability’
Vehicle makers alone have put off a cumulative $1-1.5 billion of investments. A similar quantum of deferrals is expected by the vendors.

“Having recognised the slowdown is now definitely upon us, the focus has been on ensuring that we manage the slump by doing it right,” said PB Balaji, group CFO, Tata Motors. “The focus has been on ecosystem viability, not just our viability,” he added. Official data released on Monday showed the Index of Industrial Production shrank 4.3% in September, after a 1.1% contraction in August. Mahindra & Mahindra MD Pawan Goenka had said in August that there could a 15-20% deferral of the company’s Rs 12,000-crore, threeyear capex plan. He had, however, added that product-related investments would continue.
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India Yamaha Motor launches BS-VI compliant variants of bikes

Source: IBEF.org, Nov 11, 2019

India Yamaha Motor (IYM) launched BS-VI compliant variants of FZ-FI and FZS-FI bikes, priced between Rs 99,200 (US$ 1,419) and Rs 1.02 lakh (US$ 1,460) [ex-showroom], on Friday.

According to the IYM statement, company also plans to launch other BS-VI compliant line-ups in coming time.

The launched version of FZ-FI and FZS-FI BS VI consist of several features such as single channel ABS in the front wheel, front and rear disc brakes along with a single piece two level seat.

“As Yamaha reveals from its new product line-up, the BS-VI compliant FZ motorcycles will be available across Yamaha showrooms from November 2019,” Yamaha Motor India Chairman Mr. Motofumi Shitara said.

China’s Great Wall may drive Rs. 7,000 cr investment into India

Source: The Economic Times, Nov 11, 2019

EW DELHI: China’s largest SUV maker, Great Wall Motors, has registered an Indian subsidiary and is planning to invest close to Rs. 7,000 crore in the country, even as the market is going through one of its worst slowdowns.

The Indian subsidiary, Haval Motor India with its office in Gurgaon, was registered before October, which means it won’t be eligible for the low corporate tax rate of 15% (17.01% with surcharge) for new manufacturing units in India announced by the government last month. The company, therefore, is considering setting up another corporate entity here under the name of Great Wall, a person in the know told ET.

The company has written to the Prime Minister’s Office, seeking an appointment for its chairman Wei Jianjun with Narendra Modi in the first week of next month, the people 20191111-2said. A formal announcement of the India plans may come after this meeting, this person said.

Great Wall didn’t respond until press time Sunday to an email seeking comment. The company has been scouting for sites in at least five states — Maharashtra, Gujarat, Karnataka, Andhra Pradesh and Tamil Nadu.

Maharashtra has emerged as the strongest contender, followed by Gujarat, the people said. A delegation of Maharashtra industry department officials was in China last week to invite the company to the state, industry insiders told ET.
“As of now, the company is looking at both greenfield and brownfield options in Maharashtra. It is considering the land acquired by Chinese truck maker Foton in Chakan near Pune,” one of the people said. General Motor’s Talegaon plant is another facility it is actively considering.

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Two-wheeler makers get export breather amid slump in domestic sales

Source: Business Standard, Oct 20, 2019

Two-wheeler exports rose by over 4 per cent in the April-September period of the current fiscal, with Bajaj Auto leading the segment by shipping over 900,000 units to various markets, including Africa and Latin America, as per latest data by industry body SIAM.

Two-wheeler dispatches, including motorcycles, scooters and mopeds, stood at 17,93,957 units in the first half of the current fiscal, as compared to 17,23,280 units in the same period of 2018-19.

Scooter exports during the period under review stood at 2,01,277 units, down 10.87 per cent from 2,25,821 units in the April-September period of 2018-19. Read the rest of this entry »

Auto sales slump drags fortunes of auto parts makers downhill

Source: LiveMint.com, Oct 17, 2019

A variety of issues— domestic and global— are challenging growth prospects of auto component makers. From the risk of a demand slowdown in automobiles that started about a year ago, the component industry’s problems are steadily compounding, with trade tensions across international markets and a broad-based slowdown in the parent auto industry across markets.

On the back of a weak first quarter, analysts have forecast a dismal Q2 FY20 performance for the sector.

Domestic sales of leading original equipment manufacturers (OEMs) such as Maruti Suzuki India Ltd, Hero MotoCorp Ltd and Ashok Leyland Ltd fell 30%, 21% and 45% respectively in Q2 from a year earlier. Read the rest of this entry »

Ratan Tata to invest in EV start-up Tork Motors

Source: The Hindu Business Line, Oct 14, 2019

Mumbai: Ratan Tata, Chairman Emeritus of Tata Sons, has agreed to invest an undisclosed amount in Pune-based electric vehicle start-up Tork Motors.

In past, the company has raised funds from Bharat Forge and Bhavish Aggarwal, Founder of Ola cabs.

Powered by lithium ion batteries, Tork T6X, the electric motorcycle, is engineered to travel at a top speed of 100 kmph, and runs 100 km on a single charge. The battery can be charged up-to 80 per cent in an hour.

Speaking about the investment, Ratan Tata, said, “In last few years, there has been a sea of changes in the attitude towards electric vehicles. This industry is changing rapidly and I place good value on the sound logic and the approach of the team at Tork Motors.”

Automotive sector becomes the new sweet spot for IT services firms

Source: Business Standard, Oct 09, 2019

Bengaluru: The automotive sector is becoming the new focus for Indian IT services firms as global carmakers seek outsourcing partners to help them cope with the changing requirements of customers.

Most of the IT services players are seeing a spike in demand from the sector. They hope to clinch large deals in areas like engineering services, application development and maintenance and consumer experience.

“Global automotive companies are facing growing demand for automation, for which they require engineers and digital talent. Hence, they are turning to the IT services industry to help address this increasingly urgent need,” said Peter Bendor-Samuel, founder and chief executive officer (CEO) of global research firm, Everest Group.

According to the Everest Group, apart from the slowdown in demand seen in the automobile sector, emergence of electric vehicles or EVs is also forcing auto majors to spend more on new technology.

The rising technology spend by automakers is already reflected in deals bagged by domestic IT players in the last one quarter.

Infosys, earlier this week, announced that it has been selected as the main vendor for a digital transformation project for Volvo Cars.

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