Bharat Forge, India's largest auto components maker, said it will cut production as demand from car makers shrink.
The Trident and Taj Mahal Palace and Tower said they have been flooded with requests for reservations at their restaurants when they reopen December 21, almost a month after the terrorist attacks on these landmark hotels destroyed significant portions of both buildings.
The Chicago-headquartered company, which currently operates five hotels in India under the Hyatt Regency, Park Hyatt and Grand Hyatt brands in Mumbai, New Delhi, Goa and Kolkata, said it will also introduce two-three more brands in the country. The Chicago-headquartered company currently operates five hotels in India under the Hyatt Regency, Park Hyatt and Grand Hyatt brands in Mumbai, New Delhi, Goa and Kolkata.
Hotel expects 25-30 per cent occupancy on December 21 when it throws open its doors. Trident regulars are preparing to return to the hotel sooner than later.
Some analysts, however, suggest that car-makers threaten price rises every January in a bid to clear calendar year-end inventory. "There is always a threat from auto companies, usually in January, on a price increase in an attempt by them to clear the inventory. Sometimes, the ploy is never exercised," said Mahatesh Sabarad, a Mumbai-based analyst with Centrum Broking.
A day after leading car makers Maruti Suzuki and Hyundai Motor decided to cut vehicle prices in the wake of a reduction in taxes, Mahindra Renault on Tuesday said its Logan sedan will be offered at a discount of Rs 60,000.
Forget about the Tata Nano for Rs 100,000. Or buying a sleek Yamaha R15 for over Rs 97,000. An array of car models is now available at prices under Rs 100,000, thanks to an expected 20 to 25 per cent fall in used-car prices on certain models, in response to the government's decision to reduce Central value added tax (Cenvat) four percentage points for new cars.
Slowdown in vehicle demand also behind decision.
The current slump in the automobile sector has delivered a hard knock to component makers -- classified as small and tiny enterprises -- as about 600 manufacturing units in Jamshedpur have shut down operations, while more than 2,000 other units spread across the country are on the verge of closure.
Nissan Motor Company, Japan's third-largest auto maker, has decided to cut its small car sourcing target from India's biggest car company Maruti Suzuki by 80 per cent in view of the severe downturn in Europe's automobile market.
Bookings in five-star hotels and inflow of foreign tourists into the country were already running low due to the global economic meltdown. With Wednesday's terror attack, the hotel industry is expected to see a rise in the number of cancellations and also a substantial reduction in tourist numbers since the terrorists have struck at the peak of the tourist season.
Restoration of colonial woodwork could take almost an year.
The attack comes at a time when the hotel industry is already suffering from weak demand. Thanks to the credit crunch, companies have decided to curb overseas travels and move to low-cost alternative accommodation. Even though the terror attacks occurred in south Mumbai-based Trident and Taj hotels, tourists in Delhi's Le Meridean , Shangri La and Taj Mahal were seen cancelling scheduled events.
The models will carry a price tag of Rs 1.25 crore to Rs 3 crore, the most expensive in the company's line-up, and will be custom ordered and delivered directly from Germany. Delivery time may take two or three months depending on what the customer chooses.
Car companies are hoping to buck the slowdown by launching new models to push sales from January. Industry majors like Maruti Suzuki, Mahindra & Mahindra, Hyundai India have all lined up launches in the next few weeks and months hoping to generate reasonable volumes.
The move comes close on the heels of growth in developed auto markets such as the US and Europe dipping in the red. Analysts say that global auto companies are now focusing on developing new models for emerging markets like India, their with main focus on containing costs. The cost of development in India is considered to be the lowest in the world.
Auto component companies -- especially the mid-size and small ones -- are facing an uphill task to stay afloat as banks have become tight-fisted in giving credit and vehicle makers are cutting orders to combat the slowdown in sales.
The company is evaluating options to launch the Scorpio, Bolero, Xylo and pickup trucks in the Chinese market. However, no firm decision has yet been taken. In China, the company already has a presence in the tractor segment through Mahindra China Tractors, a joint venture company with and Jiangling Motors Company.
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.
Mahindra & Mahindra has decided to curtail its capital expenditure of Rs 5,000 crore (Rs 50 billion) in view of the ongoing slump in demand for cars and sports utility vehicles in the domestic market.
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