While the Nano is priced at Rs 1.12 lakh, Bajaj Auto's RE petrol variant costs about Rs 90,000, while its diesel variant is pegged at Rs 1.2 lakh. Analysts also say Bajaj can drop prices without any problem. "Bajaj Auto has been in the three-wheeler segment for 60 years. Which means their plants are fully depreciated and they can afford to lower the prices, which other manufacturers can't do," says a top executive from a competing three-wheeler brand.
Typically, about 70 per cent of a car dealer's revenue comes from businesses like servicing, arranging finance, sale of spare parts and accessories, insurance renewals, offering driving lessons, etc. A New Delhi-based dealer said even those ancillary services might not fetch them the margins they earn from servicing other models of Tata Motors like Indica and Indigo.
The Honda company is working on entering the same segment, with a sporty bike, in 2010. It hopes to sell a few lakh of these a year, to begin with
Surinder Kapur, president of the company's 'vendor council,' said it has about a dozen representatives from Tata Motors and an equal number from the vendors. "We supply for about 4-5 per cent of our revenues to Tata Motors and we do not have payment issues," he said. Lumax, which derives about 15 per cent of its turnover by supplying almost half of the lighting solutions for Tata Motors worth about Rs 60 crore a year, said they had not experienced any payment issues.
The country's largest manufacturer of commercial vehicles by sales, Tata Motors, is lifting the production curbs imposed between October and December last year across all its plants that make commercial vehicles.
India's largest sport utility vehicle maker Mahindra & Mahindra's plan of launching its vehicles in the US has suffered a delay of almost 12 months following clearance awaited from the US homologation department.
Unprecedented fall in sales has resulted in build-up of huge inventories, and dealers are pleading with car makers. . .
Indian Oil Corporation, the country's largest oil marketing company by sales, will open the country's first hydrogen fuel-dispensing station in New Delhi next month. The new-age pump will be set up in Dwarka.
India's auto component makers not only face slower growth in the domestic market, the Export Credit Guarantee Corporation of India is now refusing credit insurance to over 50 auto component companies that sell to the Big Three car makers in Detroit.
The company attributes the delay to the slump in demand for commercial vehicles in the country since the beginning of the current year.
The special discount of Rs 800,000 offered on the Honda Civic Hybrid is not sustainable by the car-maker and could be a strategy to clean up its inventory.
Second-hand car prices have dropped 15 to 25 per cent following the imposition of stringent Supreme Court norms over repossessing and selling cars of owners defaulting on their loans.
Auto majors have introduced a range of petrol engines for compact cars that comply with the Euro-V norms and are meant for the export markets. This enables them to prepare for the stringent emission norms to be introduced in the country. While the latest compact cars manufactured in India are Euro-V compliant, the latest petrol car engines are highly fuel efficient.
Import duty on steel is a critical factor determining domestic steel prices. Auto component makers and automobile majors, faced with sagging sales over the last two quarters, have expressed strong reservations against the steel industry's demand for re-imposition of 5 per cent import duty on non-alloy steel (used to manufacture car bodies and stamped auto parts).
Manufacturers view the agreement - when it is signed - as a defence against the slowdown in the car market.
We will not be in the ultra-low-cost car segment. Our focus will be on the A1 and A2 segments, which are growth areas in which many of the new players like Nissan, Volkswagen or Toyota are planning to enter. Our entry-level car will remain the Maruti 800.
In addition to the showroom discounts that ranged from Rs 12,000 on Maruti 800, Rs 11,000 on Alto and Rs 18,000 on Wagon R and Estillo, it offered an additional discount of about Rs 4,000 to such employees. This year, it has stopped financing the scheme. Instead, it has tied up with Axis Bank that offers financing at 10.75 per cent with repayment periods of three to five years (market rates are currently at 14 -15 per cent).
India's four-wheeler sector may post a flat profit growth in the first quarter due to a rise in input costs. The cost of automobile steel, which constitutes about 40 per cent of the total raw materials, rose by more than 25 per cent during the three-month period. Prices of raw materials like aluminium, copper, rubber and fuel also appreciated significantly.
With prices of oil forecast to touch $200 per barrel this year, auto makers in the country have launched a slew of options that are not just fuel efficient but also easy to maintain. Battling the rising fuel bill is premium car maker Honda Siel, who will launch the country's first hybrid car - the Civic hybrid shortly.
Roughly 70 per cent of the country's car owners may cringe at the rise in fuel prices, but the rising cost of petrol and diesel does not appear to have put the brakes on the market for luxury cars, even though they deliver a measly mileage in single digits. Till April, sales of luxury cars, defined as those costing Rs 40 lakh and more, touched 4,000 units the same as the number of cars sold for the whole of 2007.
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