MUMBAI: Tata Motors, the country's largest commercial vehicle maker, is exploring the possibility of buying the equity stake of private equity
major Actis in commercial vehicle and bus maker Swaraj Mazda (SML). ( Watch )
The Tatas move to look at Actis' stake - it owns 7.7% and another 9.3% through unit CDC - was triggered after the private equity major started considering exit options from its investment in Swaraj Mazda, which was made in 2004, for about Rs 370 crore, according to persons familiar with the matter. They spoke on condition that neither they nor their organisation be identified.
The Actis stake is also learnt to have attracted other auto majors and a Kolkata-based engineering firm, besides other private equity funds that are looking to enter the fast-growing Indian auto market, estimated to grow at 8-10% this fiscal year.
The potential buyers are currently looking at the 7.7% stake held directly by Actis. If the CDC stake is also sold then the buyer would have to make an open offer under India’s rules governing the takeover of companies. The eventual role of Tata Motors in Swaraj Mazda, if any, will depend on the intentions of Japanese conglomerate Sumitomo, which has a controlling 53.5% stake in the Punjab-based company.
A senior Tata Motors executive said the company was looking at various options to increase its share in the Rs 10,400-crore Indian LCV market, though he declined to comment on whether the company was interested in Swaraj Mazda.
A Tata Motors spokesperson said: “This is purely speculative, on which we don’t have any comments.” Actis India head JM Trivedi also refused to comment on the issue.
If Tata Motors does indeed pick up a stake, it will give the commercial vehicle maker access to the lucrative north Indian LCV market, a segment where it has comparatively weak presence, against its market shares in the western and southern Indian LCV market.
The deal, if it fructifies, will mean that along with an access to Isuzu technology, Tata Motors would also get to increase its presence in bus body-making, another major growth area. It may be mentioned that Tata Motors recently acquired the entire equity capital of Spain’s Hispano Carrocera, a global leader in bus and coach making.
Other large shareholders in Swaraj Mazda include Reliance Capital with an 8.5% stake. Tractor major Mahindra & Mahindra earlier held a minor stake in Swaraj Mazda through Punjab Tractors, which it exited early this year by selling its 14% stake to Japan’s Sumitomo.
Tata Motors, which sells the popular Ace model in various markets across the country, has a commanding 70% share of the Indian commercial vehicle market and has been looking at further consolidating its presence by extending its fastest-growing products into the northern region.
Showing posts with label ASHOK KUMAR PGDM 1ST SEM. Show all posts
Showing posts with label ASHOK KUMAR PGDM 1ST SEM. Show all posts
Tuesday, November 24, 2009
Wednesday, November 18, 2009
Ford Fusion named Motor Trend 2010 car of year
DETROIT: Ford Motor Co's Fusion mid-size sedan was named Motor Trend magazine's 2010 "car of the year" on Tuesday, adding to the perception that
changes to the No 2 US automaker's vehicle lineup are gaining traction.
The Fusion was chosen best of 23 new or significantly upgraded vehicles and the full range of Fusion models impressed the judges, from the four-cylinder entry level vehicles to the all-wheel drive sport and hybrid versions, Motor Trend Editor Angus MacKenzie said.
"Ford has proven its resilience in these tough times by delivering to market a car with broad appeal to a broad range of customers," MacKenzie said.
The Fusion, which has become one of the top 10 selling vehicles in the United States, was redesigned for 2010. Ford launched the Fusion in 2006 and it set its previous annual sales peak in 2007.
"What a proof point, to be named car of the year by one of the most rigorous tests in the world," Ford Chief Executive Alan Mulally told reporters at Ford headquarters after MacKenzie announced the award.
Motor Trend tested the vehicles on acceleration, braking, handling, noise and responsiveness under various road and traffic conditions. It also considered design, fuel efficiency, safety and value.
Ford posted a nearly $1 billion third-quarter profit this month that surprised Wall Street analysts and is the only large US automaker not to reorganize in bankruptcy with US government support in 2009.
The automaker has said it expects to return to a solid profit in 2011 with a gradual recovery in the auto industry in the United States and key regions internationally.
US auto sales peaked at nearly 17 million vehicles in 2005 and have been falling since. Ford expects 2009 US auto industry sales of about 10.6 million units including medium and heavy trucks, or around 10.3 to 10.4 million light vehicles.
"We are cautiously optimistic that we are near the bottom right now," Mulally said of the US auto market.
Ford's shares reached a more than two-year high on Tuesday, a day after billionaire investor George Soros' hedge fund disclosed taking a 7.3 million share stake in Ford during the third quarter.
US 2009 sales of the Fusion were up 15 percent through October at 148,045 but trail Toyota Motor Corp's Camry and Honda Motor Co Ltd's Accord in the mid-size sedan segment, one of the key areas in the US market.
Dearborn, Michigan-based Ford has looked to set itself apart from U.S. rivals General Motors Co and Chrysler Group LLC, which reorganized under government-funded bankruptcies this year, and increasingly uses Toyota and Honda as benchmark competitors.
Sales of the Fusion have helped keep Ford's US sales declines for 2009 slower than the overall drop in the industry. Through October, Ford's U.S. sales are down 20.4 per cent for the year, while the industry is down 26 per cent.
Ford shares were up 15 cents, or 1.7 per cent, to $8.86 in Tuesday afternoon trading on the New York Stock Exchange. Earlier on Tuesday, the stock reached $9, a more than two-year high that is also a nearly 29 per cent increase since Ford posted its third quarter profit in early November.
changes to the No 2 US automaker's vehicle lineup are gaining traction.
The Fusion was chosen best of 23 new or significantly upgraded vehicles and the full range of Fusion models impressed the judges, from the four-cylinder entry level vehicles to the all-wheel drive sport and hybrid versions, Motor Trend Editor Angus MacKenzie said.
"Ford has proven its resilience in these tough times by delivering to market a car with broad appeal to a broad range of customers," MacKenzie said.
The Fusion, which has become one of the top 10 selling vehicles in the United States, was redesigned for 2010. Ford launched the Fusion in 2006 and it set its previous annual sales peak in 2007.
"What a proof point, to be named car of the year by one of the most rigorous tests in the world," Ford Chief Executive Alan Mulally told reporters at Ford headquarters after MacKenzie announced the award.
Motor Trend tested the vehicles on acceleration, braking, handling, noise and responsiveness under various road and traffic conditions. It also considered design, fuel efficiency, safety and value.
Ford posted a nearly $1 billion third-quarter profit this month that surprised Wall Street analysts and is the only large US automaker not to reorganize in bankruptcy with US government support in 2009.
The automaker has said it expects to return to a solid profit in 2011 with a gradual recovery in the auto industry in the United States and key regions internationally.
US auto sales peaked at nearly 17 million vehicles in 2005 and have been falling since. Ford expects 2009 US auto industry sales of about 10.6 million units including medium and heavy trucks, or around 10.3 to 10.4 million light vehicles.
"We are cautiously optimistic that we are near the bottom right now," Mulally said of the US auto market.
Ford's shares reached a more than two-year high on Tuesday, a day after billionaire investor George Soros' hedge fund disclosed taking a 7.3 million share stake in Ford during the third quarter.
US 2009 sales of the Fusion were up 15 percent through October at 148,045 but trail Toyota Motor Corp's Camry and Honda Motor Co Ltd's Accord in the mid-size sedan segment, one of the key areas in the US market.
Dearborn, Michigan-based Ford has looked to set itself apart from U.S. rivals General Motors Co and Chrysler Group LLC, which reorganized under government-funded bankruptcies this year, and increasingly uses Toyota and Honda as benchmark competitors.
Sales of the Fusion have helped keep Ford's US sales declines for 2009 slower than the overall drop in the industry. Through October, Ford's U.S. sales are down 20.4 per cent for the year, while the industry is down 26 per cent.
Ford shares were up 15 cents, or 1.7 per cent, to $8.86 in Tuesday afternoon trading on the New York Stock Exchange. Earlier on Tuesday, the stock reached $9, a more than two-year high that is also a nearly 29 per cent increase since Ford posted its third quarter profit in early November.
Tuesday, November 17, 2009
Hyundai to invest Rs 800 cr on small car for India
CHENNAI: South Korean car-maker Hyundai will invest around Rs 800 crore to develop a small car for the Indian market that is likely to be launched Rolls Royce Phantom Coupe
Bentley Mulsanne
Cars with Class
World's fastest car Ultimate Aero
in the next two years.
The firm, which has operations in India through a wholly -owned subsidiary, Hyundai Motor India Ltd, will manufacture the car, which will be smaller than the Santro, at its plant here.
"We are developing a small car and approximately Rs 800 crore will be invested at the Korean plant for development," newly appointed Managing Director and CEO of Hyundai Motor India Ltd (HMIL) Han-Woo Park told reporters.
He declined to give any details, but said: "It will be smaller than the Santro and the price will also be lesser. It will take at least 24 months from now to launch the car in India. Right now, it is in the design stage."
"Initially it will be targetted at India but gradually it will also be exported," Han-Woo added.
"It will be manufactured at the Chennai plant once the design gets completed," he said.
HMIL, which sells popular compact cars like Santro, i10, i20, has made India a small car hub for the Korean firm and has been exporting the cars to overseas markets.
In October, the company sold a total of 51,736 units, an 11 per cent growth compared with same month last year. Its exports, however, dipped by 11.9 per cent to 23,435 units during the month.
Bentley Mulsanne
Cars with Class
World's fastest car Ultimate Aero
in the next two years.
The firm, which has operations in India through a wholly -owned subsidiary, Hyundai Motor India Ltd, will manufacture the car, which will be smaller than the Santro, at its plant here.
"We are developing a small car and approximately Rs 800 crore will be invested at the Korean plant for development," newly appointed Managing Director and CEO of Hyundai Motor India Ltd (HMIL) Han-Woo Park told reporters.
He declined to give any details, but said: "It will be smaller than the Santro and the price will also be lesser. It will take at least 24 months from now to launch the car in India. Right now, it is in the design stage."
"Initially it will be targetted at India but gradually it will also be exported," Han-Woo added.
"It will be manufactured at the Chennai plant once the design gets completed," he said.
HMIL, which sells popular compact cars like Santro, i10, i20, has made India a small car hub for the Korean firm and has been exporting the cars to overseas markets.
In October, the company sold a total of 51,736 units, an 11 per cent growth compared with same month last year. Its exports, however, dipped by 11.9 per cent to 23,435 units during the month.
Monday, November 16, 2009
GE Caps-JLR $250 mn financing deal first of its kind
LONDON: Necessity could well be the mother of innovation. Tata Motors and Jaguar Land Rover have tied up $250 million (£170 million) in distribution Buying pre-owned luxury cars makes sense
World's fastest cars
financing from GE Capital, in a unique financing deal, a first of its kind in Europe. ( Watch )
GE Caps has undertaken to finance all new production of JLR cars from the time the cars leave the factory for up to 90 days, while the cars are in transit to dealers. Says Sean Neville, European business development director at GE Capital, who structured the deal for GE Caps: “While the cars are sitting in trucks, highways, and ships on their way to markets all over the world, they soak up cash like a sponge. We will squeeze the cash out and make it available to JLR.”
The deal, which will be announced on Monday, will help the maker of luxury brands access working capital, the funds used for the day-to-day operations such as paying suppliers.
World's fastest cars
financing from GE Capital, in a unique financing deal, a first of its kind in Europe. ( Watch )
GE Caps has undertaken to finance all new production of JLR cars from the time the cars leave the factory for up to 90 days, while the cars are in transit to dealers. Says Sean Neville, European business development director at GE Capital, who structured the deal for GE Caps: “While the cars are sitting in trucks, highways, and ships on their way to markets all over the world, they soak up cash like a sponge. We will squeeze the cash out and make it available to JLR.”
The deal, which will be announced on Monday, will help the maker of luxury brands access working capital, the funds used for the day-to-day operations such as paying suppliers.
Tuesday, November 3, 2009
India, China small car sales cheer auto companies at global level
MUMBAI: Consumers in emerging markets have saved the day for top global auto makers grappling with the after-effects of the steepest fall in global
output since the Great Depression. On Monday, Japan’s Suzuki Motor said that its annual operating profit would be four times more than previously forecast because of strong sales in India, according to a Reuters report.
Auto majors such as Suzuki and Hyundai Motors, South Korea’s biggest automobile maker, have seen growth buoyed by sales of small car in emerging markets. According to international media reports, Hyundai recorded about 55% of sales from China and India while Toyota saw around 31% of sales coming from emerging markets.
Hyundai, the second-largest carmaker in India, exported Santro cars and Accent sub-compacts made in India to over 100 countries, said company officials. Analysts say that small cars have emerged as a source of competitive advantage for these companies, giving them an edge over other big carmakers such as Ford and General Motors (GM), which have taken a hit in numbers.
When contacted, RC Bhargava, chairman of Maruti-Suzuki, said: “We will produce over one million cars this year and will certainly boost the consolidated balance sheet of Suzuki. A good-performing subsidiary always helps the parent company.”
Indian advantage
Suzuki’s 50% share in the rapidly-growing Indian market provides it an unusual advantage, at least in the current circumstances, compared to its much bigger rivals like Toyota and Honda who are more exposed to the US and European markets. India makes almost a quarter of Suzuki’s global production, company officials say.
Maruti Suzuki, India’s largest carmaker, also posted a 32% growth in domestic sales at 85,415 units in October 2009. Hyundai Motor India’s total sales for October 2009 stood at 51,736 units, up 11%. Tata Motors and M&M — the two largest companies owned by Indian entrepreneurs — saw growth rates in excess of 20% in October. Crucially, Tata Motors has seen a smart recovery in sales of commercial vehicles, a bellwether for economic growth.
India is the world’s fifth or sixth largest maker of passenger vehicles, depending on definitions. Sales of cars and utility vehicles is expected to be around 1.8 million units for the year ended March 31, 2010.
Despite the brisk growth rate in India, they palled compared to the eye-popping 9.6 million units sold in the first nine months of 2009 in China. The sharp contraction of consumer demand in the US has propelled China into the position of the world’s largest automobile market.
Government incentives
Domestic growth rates have been boosted by Indian government’s efforts to combat the fallout of the financial meltdown in the second half of 2008. As a result, taxes on small cars — defined according to length and the size of the engine — as well as trucks were cut to 8%, the lowest level in many years.
This is true for countries worldwide. China has halved taxes on small cars, while developed markets have sought to boost sales by encouraging consumers to bring forward purchases of new cars. The most famous of these is the ‘cash for clunkers’ programme introduced in the US that encouraged car owners to purchase a more fuel-efficient one by trading in a less-efficient car.
Both Germany and France have had similar schemes, popularly known as “scrappage schemes”. Exports of small cars from India to European countries have benefited from these.
output since the Great Depression. On Monday, Japan’s Suzuki Motor said that its annual operating profit would be four times more than previously forecast because of strong sales in India, according to a Reuters report.
Auto majors such as Suzuki and Hyundai Motors, South Korea’s biggest automobile maker, have seen growth buoyed by sales of small car in emerging markets. According to international media reports, Hyundai recorded about 55% of sales from China and India while Toyota saw around 31% of sales coming from emerging markets.
Hyundai, the second-largest carmaker in India, exported Santro cars and Accent sub-compacts made in India to over 100 countries, said company officials. Analysts say that small cars have emerged as a source of competitive advantage for these companies, giving them an edge over other big carmakers such as Ford and General Motors (GM), which have taken a hit in numbers.
When contacted, RC Bhargava, chairman of Maruti-Suzuki, said: “We will produce over one million cars this year and will certainly boost the consolidated balance sheet of Suzuki. A good-performing subsidiary always helps the parent company.”
Indian advantage
Suzuki’s 50% share in the rapidly-growing Indian market provides it an unusual advantage, at least in the current circumstances, compared to its much bigger rivals like Toyota and Honda who are more exposed to the US and European markets. India makes almost a quarter of Suzuki’s global production, company officials say.
Maruti Suzuki, India’s largest carmaker, also posted a 32% growth in domestic sales at 85,415 units in October 2009. Hyundai Motor India’s total sales for October 2009 stood at 51,736 units, up 11%. Tata Motors and M&M — the two largest companies owned by Indian entrepreneurs — saw growth rates in excess of 20% in October. Crucially, Tata Motors has seen a smart recovery in sales of commercial vehicles, a bellwether for economic growth.
India is the world’s fifth or sixth largest maker of passenger vehicles, depending on definitions. Sales of cars and utility vehicles is expected to be around 1.8 million units for the year ended March 31, 2010.
Despite the brisk growth rate in India, they palled compared to the eye-popping 9.6 million units sold in the first nine months of 2009 in China. The sharp contraction of consumer demand in the US has propelled China into the position of the world’s largest automobile market.
Government incentives
Domestic growth rates have been boosted by Indian government’s efforts to combat the fallout of the financial meltdown in the second half of 2008. As a result, taxes on small cars — defined according to length and the size of the engine — as well as trucks were cut to 8%, the lowest level in many years.
This is true for countries worldwide. China has halved taxes on small cars, while developed markets have sought to boost sales by encouraging consumers to bring forward purchases of new cars. The most famous of these is the ‘cash for clunkers’ programme introduced in the US that encouraged car owners to purchase a more fuel-efficient one by trading in a less-efficient car.
Both Germany and France have had similar schemes, popularly known as “scrappage schemes”. Exports of small cars from India to European countries have benefited from these.
Friday, October 30, 2009
Competition, currency woes hit auto cos' global ambitions
UMBAI: Auto and two-wheeler makers like Bajaj Auto, TVS, Ashok Leyland and Tata Motors are finding it difficult to scale up their global
manufacturing plans given that most of them are currently loss-making. Recessionary trends and a fluctuating currency have hurt the cost structures of these plants, making them highly unprofitable.
TVS and Bajaj Auto, which set up two-wheeler operations in Indonesia, incurred losses of Rs 88 crore and Rs 48 crore, respectively, in 2008-09. Tata Motors, which has a pick-up plant in Thailand, posted a loss of Rs 89 crore for FY09, while Ashok Leyland, which has a bus-making unit at Ras Al Khaimah and a truck-making plant in Czechoslovakia called Avia, are apparently incurring losses.
There are well-entrenched global players in these markets and it is difficult to compete with them with a limited product portfolio, said M Sabarad, senior analyst at Centrum, a Mumbai-based broking firm. After October 2008, the retail financing companies suffered a liquidity crisis and tightened credit norms. Interest rates were increased and it affected the automobile sales. This was a major hindrance affecting the scalability of most overseas plants, said a senior official from Bajaj Auto.
manufacturing plans given that most of them are currently loss-making. Recessionary trends and a fluctuating currency have hurt the cost structures of these plants, making them highly unprofitable.
TVS and Bajaj Auto, which set up two-wheeler operations in Indonesia, incurred losses of Rs 88 crore and Rs 48 crore, respectively, in 2008-09. Tata Motors, which has a pick-up plant in Thailand, posted a loss of Rs 89 crore for FY09, while Ashok Leyland, which has a bus-making unit at Ras Al Khaimah and a truck-making plant in Czechoslovakia called Avia, are apparently incurring losses.
There are well-entrenched global players in these markets and it is difficult to compete with them with a limited product portfolio, said M Sabarad, senior analyst at Centrum, a Mumbai-based broking firm. After October 2008, the retail financing companies suffered a liquidity crisis and tightened credit norms. Interest rates were increased and it affected the automobile sales. This was a major hindrance affecting the scalability of most overseas plants, said a senior official from Bajaj Auto.
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