The much-awaited excise duty cut on small cars to 12 per cent (from 16 per cent) made by the finance minister may have brought smiles on the faces of car manufacturers but this, dealers say, will increase the waiting period on some popular models by another additional month.
Auto component sourcing has touched $3 billion in India and is expected to double by next financial year-end. Such sourcing has provided Indian players with the opportunity to charge a premium that varies between 5 and 10 per cent.
Rs 1,199 spread comfortably across 84 months or 7 years. The rate of interest is 11-11.5 per cent, which is cheaper than a two wheeler loan.
Indian tyre makers are expanding their capacities in the wake of international players flooding the Indian markets.
Yamaha is all set to launch two premium bikes, priced close to Rs 1 lakh. This is an attempt to revive the company's dipping sales and image.
MV Agusta, the Italian exotic superbike maker, is actively looking to launch its bikes in India
Say lower duties could enhance demand.
Italian auto major Fiat Auto has asked Rajeev Kapoor, the newly appointed president and CEO of Fiat Auto India Automobiles, to take charge of the Indian operations after managing director De Filippis Giovanni's recall from the position about a week back.
The Italian car company Fiat's much-awaited launch of the year, Grande Punto hatchback, which is expected to take on Maruti Suzuki's Swift and Hyundai's Getz, will not be priced close to the two models.
Call it the "Nano effect" but less than a month after Tata Motors displayed its competitively-priced small car at the Delhi auto show, prices in the 1.3-million used-car market crashed 15 to 30 per cent, if not more.
Vehicles from global giants such as Yamaha, Kawasaki could be 40-50% cheaper when assembled in India.
According to the plan, Volvo will buy used tippers, which are used in mining and construction, from its customers at an agreed price and refurbish them internally and externally, before reselling them to a new buyer with a six-month warranty.
Auto analysts suggest that Tata Motors may not be able to generate more than three to four per cent on net profit margins and five to six per cent on EBIDTA margins on the car. In addition, while production of the model is ramped up, sales will also have to rise in tandem.
Volkswagen plans to integrate its Indian facilities, which will help the company contain costs and maintain uninterrupted supply of auto parts.
Swedish behemoth Volvo has charted out an aggressive strategy to become a leader in the country's heavy commercial vehicle sector, following its alliance with the Delhi-based Eicher Motors.
The Triumph executive, however, declined to comment on the companies, which were in talks with it. Sources said Bajaj might be one of the companies the UK group is holding talks with. Representatives of Bajaj, which was reportedly negotiating with Triumph for an equity buyout, had visited the company's plants in the UK.
After showcasing the yet-to-be-named car (Ratan Tata calls it "the people's car") in the capital, the company is planning a similar splash at the Geneva Motor Show in March, a company spokesman confirmed.
Companies, which are jumping into the bandwagon, include MNCs. For instance, the world's leading component company Bosch has committed an investment of Rs 2,650 crore (Rs 26.50 billion) through four subsidiaries in India. Funds will be used to set up manufacturing facilities for gasoline systems, electronic control units and ABS systems.
The ongoing credit squeeze in the sluggish two- and three-wheeler markets may affect the March sales targets of the three leading domestic players in the country. Taking the cue from a buoyant FY07 where the two-wheeler industry grew by a healthy 11.42 per cent, companies such as Hero Honda, TVS Motors and Bajaj Auto were hoping to surpass the FY07 target of 7.8 million units this year.
The industry will see as many as 24 new launches in 2008, from 14 car makers across the country, with nearly all of them being unveiled at the upcoming Auto Expo in New Delhi. New model releases from the top three manufacturers will include Tata's much awaited 'One lakh car' concept (almost production ready), new compact car Indica, mid-sized car Indigo and the Sumo multi-utility vehicle.
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