VW to cut output but confirms 2008 sales targets AFP
AFP - German auto giant Volkswagen will cut output to deal with effects of the financial...
2008-10-24 08:00:00Kolkata, Oct 15 IANS The liquidity crunch and exchange rate fluctuations are creating pressure on margins and demand for premium cars in India, a top official of Honda Siel Cars India Ltd said here Wednesday.
BUS33BusinessLiquidity crunch creating pressure on car demand: HondaKolkata, Oct 15 IANS The liquidity crunch and exchange rate fluctuations are creating pressure on margins and demand for premium cars in India, a top official of Honda Siel Cars India Ltd said here Wednesday.According to the data released by the Society of Indian Automobile Manufacturers, sale of Honda Siel cars dropped 19 percent in the April-September period."Early reports of sales in October are encouraging that marks the beginning of the festive season," Jnaneswar Sen, Honda Siel vice-president marketing told reporters on the sidelines of the launch of the company's new City model.In 2007-08, the company sold 62,800 cars consisting of models like City, Accord and Civic.Honda Siel is planning tie-ups with public sector banks as several private sector banks and non-banking finance companies are already present in auto-finance business."While we have had relationships with several private sector banks for financing, some of our dealers have now started working with state-owned banks like State Bank of India and Punjab National Bank," Sen said.The fluctuation in the value of rupee and specifically its depreciation against Yen have forced the company to look at more local manufacturing of components.Sales of passenger cars of Honda Siel have dropped about 45 percent in September, following the phase out of its City EX model."The drop in sales of our cars last month was mostly because of our decision to stop sales of the City EX model. The drop is not an aberration," Sen said.The model has now been replaced by the new City model called the 'Third Generation', launched in September, he said.--Indo-Asian News Serviceag/sj/vm292 Words15102038
2008-10-15 12:05:10Confidence is greatest casualty of market crisis
BUS3Business/BusinessConfidence is greatest casualty of market crisisBy Oleg MityaevMoscow, Oct 15 RIA Novosti In its desperate attempt to rescue Russia's crisis-ridden financial market, the government adopted a massive rescue package Oct 7, but the measure has done little to shore up business confidence.Apart from the trillions of rubles allocated for short-term and mid-term financing of the banking system, Russia's largest banks will receive another 950 billion rubles $36.42 billion for five years and beyond.According to the government and central bank's plan, these funds are to filter down to smaller banks and businesses, which are in acute need of refinancing.Starting in the US mortgage market over a year ago, the financial crisis has crept all over the world causing a chain reaction of distrust in the banking sector.To increase financial security, even those American banks that were not affected by the mortgage crisis have tightened credit for home loans, not so mention the European loans. At the same time, the European banks that have stayed afloat are afraid to refinance Russian banks and companies.Under such circumstances, the billions of dollarsand in Russia trillions of rubles poured into the leading European countries' banking systems failed to produce the desired effect yet.The sense of uncertainty is so strong that the leading financial institutions hesitate to credit smaller banks, which, in turn, cannot re-credit business, or do not want to risk it.Private customers suffer as well: even Russia's largest banks have raised interest rates or simply put a limit on issuing credits, especially mortgages.Unless the global banking system including Russia's, which is the monetary circulatory system for the non-financial sector of economy, resumes crediting business, the economic slowdown, and then the recession of economies stricken by the crisis of confidence, will become a reality.In Russia, it is retailer chains that have suffered the most from the crisis of confidence. Anticipating an ever-growing consumer demand, they purchased large batches of goods on credit. With the credit stream running dry and consumers shying away, retailers found themselves on the verge of bankruptcy.The most notorious example is the situation with Russia's largest cell phone dealers. Euroset, the market leader, was rescued thanks to billionaire Alexander Mamut, who bought it for $1.25 billion. Three fourths of that sum will be spent on buying down the debt of Euroset's former owners, instead of being transferred to their accounts.Two other large retailers - Svyaznoy and Tsifrograd - have applied a similar scheme: exchanging a former owner for a large investor. As can be seen, there are still people and companies in Russia that have funds to invest.To raise extra capital, cell phone retailers had to start charging a commission for processing payments. On the other hand, new investors will help them survive the current crisis, and then they are likely to resell the businesses to mobile operators.As a result, Russia may convert to the European format where mobile operators sell phones themselves, with prices often discounted.Nevertheless, it is obvious that the crisis of confidence will not be resolved that smoothly in other economic sectors. It is not only retail chains that have found themselves in debt - Russia's largest companies have been plagued by the same trouble.For example, Oleg Deripaska, the richest Russian according to Forbes, lost Canadian auto parts manufacturer Magna, which he had purchased for $1.5 billion on credit. Deripaska failed to pay off his debt, and Magna went to French creditor BNP Paribas.Because of problems with financing, the GAZ group, part of Deripaska's empire, reported a one-week halt in GAZelles light commercial truck production. The assembly line stopped because of a drop in GAZ sales, which, in turn, was caused by the deteriorating auto loan market. Moreover, local GAZ dealers stopped making advance payment which is why the car manufacturer now lacks working capital to buy auto parts.So, it all came around to where it started.For similar reasons, the Kamaz heavy-duty truck production plant announced a shortening of the workweek from six to four days through December 6.A cut in car production against the background of the financial crisis is a global trend. Europe's Opel, BMW and Skoda, as well as US General Motors and Chrysler have all announced a reduction in output.The magnitude of the crisis is evident from the fact that the Russian government came in rescue of the country's oil and gas majors - Gazprom, LUKoil, Rosneft and TNK-BP - to pay off their debts to western banks and maintain production.One might think their coffers had swelled with petrodollars. However, as soon as "black gold" sank below $90 per barrel, Russian oil tycoons desperately turned to the state for help.--RIA Novostidkg851 Words15100838
2008-10-15 00:03:06By Varada Bhat
BUS4BusinessCredit squeeze hits car salesBy Varada BhatMumbai, Oct 5 IANS Retail car sales by the Indian automobile industry have been hit hard by the squeeze on retail financing as banks have stopped hardselling car loans in the current economic climate, say auto industry representatives.Unlike in the past, when customers used to be inundated by phone calls from banks offering car loans, many banks are now unwilling to provide automobile loans."Even a few months back it was easy to get car loans, but not any more. Now, banks are always looking for ways to turn down deals," Honda Siel Cars India Ltd marketing vice-president Jnaneswar Sen told IANS.The credit crunch has made automobile dealers scramble to find loans for their customers. "We've reports that customers are coming in but getting them car loans has become a tough task," said Western India Automobile Association president Deepak Kapadia.According to Sen, 75 percent of sales are made through such financing. "Many customers are shying away or postponing big-ticket purchases such as cars," he said.In September, premium car maker Honda saw its sales drop 45.2 percent to 3,104 units from 5,674 units in the same period last year.Even cars in the mid-market segment are stuck in first gear. Tata Motors saw its sales dip by nine percent to 16,586 units against 18,216 last year, whereas Maruti Suzuki posted a marginal 2.53 percent increase in sales to 64,682 units, compared to 63,086 in September last year.To add to the industry's bumpy ride this festive season, top financiers like ICICI Bank and Kotak Mahindra Bank are considering a 100 basis point hike in car loan interest rates next week.An analyst from a leading brokerage firm, who chose not to be identified, told IANS: "Financiers are already expecting a 15-20 percent dip in total disbursals this season. Three years back 90 percent sales were financed vehicles, but now it's down to 60 percent."Banks like HDFC, which disbursed about Rs.80 million in auto loans last year, expect around Rs.75 million in disbursals this year, while ICICI Bank, which disbursed Rs.120 million last year, is expecting a 20-40 percent cut in disbursals, he added.--Indo-Asian News Servicevb/sj/arj/jg395 Words**05101253
2008-10-05 03:00:00West Bengal industrialists, common people regret Tata pull out
NAT89National/Society/BusinessWest Bengal industrialists, common people regret Tata pull outKolkata, Oct 3 IANS Tata Motors' decision to pull out from West Bengal is the "worst possible thing" to happen to the state, said industrialists and commoners Friday, voicing disappointment over the auto major's decision to take its Nano small car factory elsewhere."I am extremely depressed and disturbed at this decision. All our hopes for the project are shattered today," Indian Chamber of Commerce president and Patton Group managing director Sanjay Budhia told IANS."I am still hoping against hope that something miraculous can happen. International repercussions of this decision are not at all good and will have their negative impact on future investments in the state. We have lost our face completely," Budhia said expressing the all-round disillusionment.Announcing the pull-out, Ratan Tata said Friday: "We have taken the regretful decision to move the Nano out of West Bengal. This is a decision that we have taken with great deal of sadness. We've taken this decision today because we've a timeline to meet and assurances to keep. We did not see any change on the horizon." Tata Motors took up the project to construct the factory for Nano, priced at Rs.100,000 $2,500 in Singur, 40 km from here, a couple of years back. But it experienced constant resistance from the Trinamool Congress-led 'unwilling farmers'. It finally suspended work Sep 2 fearing the safety of its workers.Originally scheduled to roll out this month, the company signalled it was considering a pull-out and talking to other state governments for an alternate location following intense protests by the Trinamool Congress. The protesters had originally demanded return of 400 acres to farmers who had to part with their land for the project against their will."This is a sad happening. We have to think of something else now to move forward in the path of industrialization," Harshavardhan Neotia, Ambuja Realty Development Ltd. chairman, said.A similar concern was echoed by common people.Nayonee, a research scholar, said: "This is not desirable. This is extremely regressive for the state. All the political parties should have acted more responsibly. It's a failure of the political system.""We hoped that the project will come up here. But now that they have rolled back, we have a question to ask the state government. What will they do with the land they have acquired in Singur from us" asked Mihir Mal, a resident of Beraberi in Singur, who lost his land for the project.Cutting across age groups and political leanings, people of the state had hoped for industrialization."This is not at all good for the state. All our hopes are shattered. I have a small kid, I thought with industrialization the state will prosper and they will have a better future ahead of them. But now it seems impossible," Malabika Chatterjee, a housewife, said.A young banker said: "This is the worst possible thing that could happen in West Bengal at a time when industrialization is the need of the hour for the state."--Indo-Asian News Serviceag-sb/rn/vt551 Words*03102242
2008-10-03 13:08:15Congress demands better compensation for Singur farmers
NAT36National/Politics/EconomyCongress demands better compensation for Singur farmersKolkata, Sep 28 IANS West Bengal Congress President Priya Ranjan Dasmunsi Sunday said the ruling Left Front government should offer better economic compensation to the landlosers in Singur."It's the responsibility of the state government to provide land and better compensation to Singur farmers," Dasmunsi, who is also the union information and broadcasting minister, told a party meeting at Sanapara in Hooghly district's Singur - about 40 km from Kolkata. "I request the government to increase the compensation amount from 10 percent and declare a separate 'land for land' package for the Singur project-affected agricultural land owners."Tata Motors has suspended work at Singur plant where the auto major was supposed to roll out the world's cheapest car Nano. The work has been stopped since Sep 2 after some of Tata workers were threatened and manhandled by a section of farmers, led by opposition Trinamool Congress, to protest the acquisition of their land for the Nano project. Dasmunsi said the Congress would meet Governor Gopalkrishna Gandhi Monday and discuss the matter with him."We'll appeal to Gandhi to take initiative, once again, to settle the issue," Dasmunsi said, adding the Congress demands an all-party meeting to be called by the government to resolve the issue.The six-point package, declared by the state government earlier this month, said all those who have not taken the compensation amount so far will be entitled to a sum equivalent to 10 percent of the award in their respective names. But the deadline for the offer expired Sep 24.Blaming the Communist Party of India-Marxist CPI-M-led state government, Dasmunsi said: "The communists also don't want Tata Motors' Nano project in West Bengal and which is why they are constantly saying the auto major is shifting its plant from the state. This is not the way for a state government to deal such important issue.""The CPI-M party does not want the project to be set up in West Bengal. If this happens, they would easily be able to pass on the responsibility to the opposition party. The ruling party is just politicising the Singur issue," he said.He said that Tatas should also rethink the matter."They Tata Motors cannot take the decision to move out of the state so easily, just after facing some political agitation. Once they've chosen Singur, they've to set up industry here. They cannot leave West Bengal like this," he added.--Indo-Asian News Servicesb/ssp/sk/dg437 Words*28091801
2008-09-28 09:00:07West Bengal government, Tatas in secret deal: Mamata
BUS26Business/National/EconomyWest Bengal government, Tatas in secret deal: MamataSingur, Sep 26 IANS Amidst signals of an imminent pullout by Tata Motors from here, Trinamool Congress chief Mamata Banerjee Friday alleged there was a clandestine deal between the auto major and the West Bengal government.Referring to the Sep 7 agreement inked between the government and the opposition in the presence of state Governor Gopalkrishna Gandhi, Banerjee said: "As per the accord, only the vendors were supposed to stop work. We never sought halt to the work at the mother plant. The government should answer why the factory is still closed." Addressing a rally here, she said: "There seems to be an unholy alliance between the Tatas and the CPI-M Communist Party of India-Marxist. The two seem to have entered into clandestine deals. Lot of money is involved." Banerjee squarely blamed West Bengal's ruling communists for the deadlock, saying they had failed to create a congenial atmosphere needed for industrialisation. According to her, the CPI-M neither wanted agriculture to flourish nor industries to thrive. "Had they loved agriculture or industry they would not have gone back on the September 7 agreement. They also don't want farmers to get back the land forcibly taken for the project."On speculation that Tata Motors could be on its way out of the state, she said the government should take the blame as it had failed to create a congenial atmosphere. "They have destroyed all semblance of a congenial atmosphere. They have neither a land map, nor a land management policy, nor a land bank. They wanted to set up the factory by imposing prohibitory orders, and by using the police. Now the Tatas have also told them they cannot work under such conditions. "You cannot have a factory if there is unrest. Industries have to be set up with a humane touch," Banerjee said in an aggressive speech near the venue where she had staged her 15-day siege demanding return of 400 acres farmland acquired for the project. She predicted that the Left Front would be ousted in the next elections and said: "If we had been in power in the state, this problem would have been solved in a day. This government doesn't know how to work."Banerjee also ridiculed those saying that if the Tata Motors pull out of West Bengal, then not only would Singur be denied a major industrialisation project, but landowners would also not get back the land. "Tata is not the only industrialist wanting to set up shop. Several others have lined up. Farmers will get back land, agricultural labourers will get compensation, and industry will also be set up," she said. Banerjee said she never wanted Tata Motors to leave, but if it was bent on moving out, then it was a "problem between the company and the government"."We will continue our fight," she added.Heavy security arrangements were made for the rally, with the deployment of over 3,000 police personnel, as the CPI-M had also brought out a procession supporting the Nano project.--Indo-Asian News Servicessp/ank/tb554 Words*26091859
2008-09-26 09:00:00Infotech sets aside Rs.3 bn for acquisitions Lead
BUS24Business/NationalInfotech sets aside Rs.3 bn for acquisitions LeadNoida, Sep 22 IANS Infotech Enterprises Ltd, an information technology-consulting firm, has earmarked Rs.3 billion for new acquisitions in the current year, a top company official said here Monday.The company raised Rs.3 billion in July last year through equity dilution, with global growth equity firm General Atlantic picking up a 13 percent stake and the Mauritius-based Carrier International acquiring two percent. "We will close two major deals this year, one is the acquisition of Time to Market, based in Santa Clara, California. The deal will be closed by September 30," said Infotech chairman and managing director B.V.R. Mohan Reddy.The US company is a leading provider of embedded software to clients in the networking, communications, consumer electronics and semiconductor industries."The second acquisition is of an auto engineering company in Europe which will be closed by the end of this year," Reddy added.However, Reddy refused to divulge any further details.The company Monday inaugurated its 600-seater facility in Noida, which will be engaged in Software development, IT-enabled services and mapping geographical bases business. The four level facility is built over 45,000 square feet on an investment of Rs.200 million Rs.20 crore.“This will be Infotech's fourth facility in India, besides two in Hyderabad and one in Bangalore,” Reddy said.The company has also expanded its base in tier-II cities like Kakinada where it has employed 260 people and plans to raise it to 450.The Hyderabad-based company has been growing by 40 percent year-on-year, Reddy said, adding that there has been no acquisitions since 2005.Infotech recorded revenues of Rs.2 billion with a profit of Rs.245 million for the first quarter ended June 30."We expect to close this financial year with revenues of about Rs.9 billion without factoring any acquisitions,” Reddy said. --Indo-Asian News Servicepd/ank/dg341 Words22092007
2008-09-22 11:09:05Infotech earmarks Rs.3 bn for acquisitions
BUS15Business/TechnologyInfotech earmarks Rs.3 bn for acquisitionsNoida, Sep 22 IANS Infotech Enterprises Ltd, a global information technology consulting firm, has earmarked Rs.3 billion for new acquisitions in the current year, a top company official said here Monday."We will close two major deals this year, one is the acquisition of Time to Market, based in Santa Clara, California. The deal will be closed by September 30," said Infotech chairman and managing director B.V.R. Mohan Reddy.The US company is a leading provider of embedded software to clients in the networking, communications, consumer electronics and semiconductor industries."The second acquisition is of an auto engineering company in Europe which will be closed by the end of this year," Reddy added.However, he refused to divulge any further detail.The company on Monday inaugurated its 600 seater facility in Noida which will be engaged in Software development, IT-enabled services and mapping geographical bases business. --Indo-Asian News ServicePD-ash/ank/dg168 Words22091744
2008-09-22 08:04:08The discounting treadmill
It looks like General Motors is stuck on the discount treadmill. Bloomberg reported today that GM will extend its employee pricing program for all consumers for another month. The offer was set to expire on Sept. 2. With sales in the tank, all carmakers need to goose sales somehow. But going long with come-ons like rebates, employee pricing and 0% financing is a slippery slope. It’s easy for a carmaker to rely on discounts and tough to get off them. GM complains about $1,600 a car in retiree benefits costs. But giving away more than $3,000 a vehicle in incentives is a bigger hit to the bottom line. It can get pricey for GM. According to the company’s website, employee pricing cuts a little more than $2,100 off the sticker of a well-equipped Chevrolet Malibu LTZ for a sale price of $25,600. But then you can add in a $1,000 rebate for the Malibu and the discount climbs above $3,000. Discounts are bigger for more expensive models. A top-of-the-line, $48,000 Chevy Tahoe 4x4 sells with a $5,000 discount. Add in the $2,000 rebate and the truck sells for $41,000. The big offers just add to GM’s marketing quandary. All of the domestic auto makers have been trying to get better pricing and cut discounts. They need to conserve cash in the near term and in the long run, convince buyers that their dealerships aren’t just bargain shops. GM and rival Ford were trying to scale back a bit on incentives and even sneaked in a few price hikes over the past couple of years. Massive production cuts helped them pull back somewhat. But a weak market and plummeting popularity for their best models—trucks and suvs--has reset the clock. It will take a long time for Detroit to prove that they can really sell cars based on their merits instead of the deal.
2008-09-10 16:34:09
Explore the Worldviewer.com Network Sites
Carbs - carburetorsiworld.com | Volkswagen - autopartsiworld.com | Wahweap - marinasiworld.com | - boatingiworld.com | Street racing - racingiworld.com | Suvs - vehiclesiworld.com | Us divers - diversiworld.com | - | Movie - trailersiworld.com | Logging - drillingiworld.com | Monstercommerce - cartsiworld.com | Wireless - automationiworld.com | - carcleanersiworld.com | - automobilesiworld.com | Automotive - driveshaftsiworld.com | Ridgeback - motorcyclesiworld.com | Trucks - carsiworld.com | Site traffic analytics - trafficiworld.com | - vehiclepartsiworld.com | Newletters - automanufacturersiworld.com
