Thursday, June 2, 2011

Honda plans its next plant in Karnataka

Auto Manufacturing could get a boost in Karnataka as Honda Motorcycles and Scooters India may set up a manufacturing plant at a location close to the IT capital of India, Bangalore.  For the Southern state primarily known for the IT sector mainly concentrated in and around it’s capital, this bit of news could come as a welcome break as investments in the auto manufacturing space have been few and far in between, with most automakers preferring the neighboring state Tamil Nadu, for their investments.

According to sources in the know about this project, Honda’s two wheeler manufacturing unit in Karnataka could entail an investment of close to INR 1,000 crores. Also, a large number of jobs are expected to be created with the setting up of the manufacturing plant which would definitely boost the local economy. Honda, it seems is on a rapid expansionist spree with it’s second Indian plant at Rajasthan all set to go on stream on the 1st of June.

Silver Colour Honda CBR250R

Honda has been making no bones about the fact that it wants to be the top player in the Indian two wheeler market in the times to come and having exited it’s long time joint venture with the Hero group, Honda seems to be all set to work towards furthering it’s goal of being numero uno in India. So, the third plant being planned comes as no surprise although most two wheeler industry analysts estimated the third plant sometime in 2015-16.

As a prospective Honda two wheeler buyer, you can expect waiting times to go down if Honda’s expansion plans work according to plan and also the spare parts situation improve. Currently, Honda Activa buyers are havingto wait for 2-4 months for delivery even as we’re hearing many harried customers of the Honda CB Twister complaining about lack of spare parts, especially in times after a accident. Hopefully, Honda will be able to address these issues on a war footing once it’s production expansion begins.

Friday, May 20, 2011

Scooters India

 

The iconic Scooters India (SIL) could be up for revival with the government looking to divest its stake fully to a player who can infuse technology and funds. The move, if implemented fast and successfully, could see Congress challenge the Mayawati regime on the industrialization plank ahead of the 2012 elections. Scooters India was a leading manufacturing unit in Lucknow which produced the fashionable Vijay scooters before slipping into the red. Today, it manufactures three-wheelers and has a market share of 2.7%, employing 1,255 people. Though owned by the central government, it has become a symbol of general decline of Uttar Pradesh.

According to sources, the Centre would shed its 95% equity in the company to a strategic partner who would bring in money and technology to restore the cutting edge to the one-time giant. The Centre would identify the investor and decide the terms. The government feels the company, which lost its sheen after it stopped making two-wheelers 15 years ago, can hope for revival in long-term if money and technology are injected. Under the new owner, the company would offer a Voluntary Retirement Scheme (VRS) to 900 workers to attract joint venture partners. The VRS would cost Rs 78 crore, while other employee benefits would be borne by SIL.

It is expected that the symbolic value of SIL's revival among voters can paint broader agenda of Congress for the state, while taking a dig at the local government. The Rail Coach Factory, which made news for facing resistance from UP, would roll out its first wagon soon, and Congress is eager to make political capital over BSP ahead of the 2012 assembly polls. Industrialization and employment are votecatchers which go with the Congress campaign that development in UP has slipped under regional outfits. Industrialisation had triggered a major political tussle between Congress and BSP when CM Mayawati resented that the Congress first family was setting up units on its turf of Sultanpur-Rae Bareli-Amethi. UP blocked land acquisition for the rail factory in Rae Bareli and it led to a showdown when Sonia Gandhi threatened to court arrest in protest. The state then gave in.

A revival of Scooters India can appeal outside the limited Gandhi family turf to highlight the Congress agenda for the state, party observers said. The Lucknow-based unit attempted to reinvent itself in 1997 when it went for manufacturing three-wheelers. But an attempt at forging a JV later found no response. It is now a sick company with 83% machines older than 1970 and 43% workers aged above 55 years and set to retire in three years, sources said.

Saturday, April 30, 2011

Lohias to introduce electric 3-wheelers

Lohia Auto Industries plans to launch electric three-wheelers by Septe­mber this year. The yet to be named model will be launched in passenger and commercial variants. “The electric three-wheeler model will help in cheaper city travel. We have invested Rs 20 crore for a new assembly line for manufacturing three-wheelers at our factory in Uttarakhand,” Ayush Lohia, chief executive of the Uttrakhand-based electric two-wheeler maker, said.

The model will be developed with 95 per cent local content and will compete with light commercial vehicles like Tata’s Ace. He said light commercial vehicles are generally used for a range of 100 km a day in a city and their usage could be rendered cheaper with an electric model.

Lohia said the company has written to the ministry of new and renewable energy seeking subsidy or cash benefits. The ministry has already granted cash benefits of Rs 5,000-6,000 on sale of electric two-wheelers and up to Rs 100,000 on sale of electric four-wheelers in December last year till the end of FY 2011-12 as part of the 11th five-year plan.

NK Lohia-promoted Lohia Group with roots in textiles and engineering plastics business. The company sold 5,000 units of electric two-wheelers in 2010-11 and aims to sell 9,000-10,000 units in 2011-12, said Lohia. “We plan to have 50 dealers in place including south India by the end of this fiscal,” Lohia said. The company is also looking to export its two-electric scooters Fame and O-Star to the UK, the US and Italy later this financial year through local distributors.

Wednesday, April 13, 2011

Vespa is coming back to India

The name Vespa strikes a chord in the Indian market. The Italian two and three-wheeler manufacturer's successful collaboration with LML for geared scooters was quite the story. But the joint venture with LML broke up in 1999 and it wasn't until eight years later that Piaggio announced plans to re-enter our market with a spanking new facility in Baramati that Vespa resurfaced. India will be the third country in the world, after Italy and Vietnam, to manufacture these scooters. Considering the fact that the Indian two-wheeler market is seeing ever growing demand for automatic scooters, there's always room for another manufacturer to spread its wares.

Piaggio's first scooter for India will be the automatic LX 125, set to arrive in 2012. The Vespa LX 125 is a classic model, paying tribute to the original 1946 Vespa with its retro styling. It is a compact scooter, sporting well-rounded curves and a cute, round headlamp which is flanked by chrome rearview mirrors. The front apron sports a centre cowl, reminiscent of scooters from the past, apart from a chrome grille that houses the horn. The front apron is otherwise clean, smooth and incorporates a set of tall, rectangular indicators. An angular front mudguard guards the front suspension and five-spoke alloys.

The LX dash employs a rounded housing and retro font, with a speedometer, fuel gauge, low-fuel warning light, tell-tale lights and digital clock. Switchgear is thoroughly modern, and classy. Inside the apron sits a petite glovebox, capable of holding a few knick-knacks. There's a ridged footboard below. The seat seems wide, and should provide comfort for both, rider and the pillion. A large under-seat storage bay is present as well. Behind the seat lies a functional-looking grab handle, while the LX 125 rear is smartly contoured, again retro, but simple with an edgy stop lamp and turn indicators. An all-metal body should endure the LX 125 with robustness, as opposed to most Indian plastic-body scooters of today. However, fit and finish and quality on the scooters to leave Baramati remain a question mark for now.

The LX 125 for India will deploy a 124cc, four-stroke, fuel-injected, air-cooled single cylinder engine. 125cc is a favourite displacement for Vespas, the Italian manufacturer having often given its vehicles similar capacity engines over six decades. Peak power output is a decent 10.7bhp at 8250rpm, while maximum torque will be 0.97kgm at 6500rpm. Its automatic CVT transmission, coupled with decent power and torque, should help the LX 125 deliver ample performance and offer convenience in Indian traffic conditions.

The front suspension is a single-side, linked arm with hydraulic shock absorber and coil spring, the rear suspension comprises a hydraulic shocker, adjustable for preload. The LX 125 uses a purposeful 200mm front disc brake, with a conventional 110mm drum behind.

With the pricing yet to be announced, indications are that the LX 125 will be dearer that its competition, with premium positioning. It is yet to be seen if the Indian market will accept premium scooters, shell out that difference in money and make a lifestyle statement. Only time and a India road test will give the answer.

Sunday, April 3, 2011

HMSI shows 2% increase in sales in March and jumps to 30% in 2010-11

Two-wheeler manufacturer Honda Motorcycle & Scooter India (HMSI) today reported 2.09 per cent jump in its total sales for March at 1,47,301 units compared to 1,44,288 units in the same month of the previous year.

For the entire 2010-11 fiscal, the company's total sales increased by 30.31 per cent to 16,56,727 units from 12,71,377 units in the previous fiscal, HMSI said in a statement.

During March, motorcycle sales inched marginally to 65,899 units as against 65,888 units in March 2010, it added.

The company reported an increase of 3.83 per cent in scooter sales to 81,402 units last month from 78,400 units a year ago during the same month.

During 2010-11, the company's motorcycles sales rose by 44.06 per cent to 7,48,895 units from 5,19,832 units in the previous fiscal.

Scooters sales in the last fiscal stood at 9,07,832 units as against 7,51,545 units in 2009-10, up 20.80 per cent.

Sunday, March 27, 2011

Honda plans to unveil scooters with stronger engines

Honda Motorcycle and Scooter India (HMSI), the leader in the automatic scooter segment, is preparing to launch a bigger capacity scooter.

Honda, the maker of Activa, India's largest selling gearless scooter, will tap the customer base which seeks upgraded versions of the available 100-125cc engines.

Shinji Aoyama, President and CEO, HMSI, said, "We will introduce a bigger displacement scooter in the coming period. There is a need for a more powerful product in that segment".

The company currently sells the Activa (110cc), Aviator (110cc) and Dio (102cc) in the scooter segment and five motorcycles � Twister, Shine, Stunner, Unicorn and Dazzler. Scooters will contribute nearly 55 per cent to the company's sales this year, which is expected to stand at 1.65 million units.

Although power scooters are popular in some overseas developed markets, manufacturers have been conservative in introducing them in India due to their higher price tags. Pune-based Kinetic Motor Company, once the market leader in the scooter segment, had launched a 165cc engine power scooter, Italiano Blaze, for nearly Rs 50,000. The demand for the Blaze was high due to its superior performance, but Kinetic wasn�t able to provide the service and back-up parts. Kinetic eventually decided to wrap up its business and sold its assets to Mumbai-based conglomerate Mahindra & Mahindra for Rs 110 crore in 2008.

Although there was no clear indication on what the new scooter from HMSI will be, market experts believe it would have an engine of around 130-150cc. The move towards a bigger engine is also triggered by the buoyant demand seen for the Suzuki Access 125. While a small capacity scooter of around 100cc carries a price tag of Rs 41,000, a bigger engine scooter by HMSI will ideally be priced at Rs 50,000-55,000, say market analysts.

The India scooter market has seen scorching growth so far this financial year, with sales of 1.88 million units, an increase of 44 per cent in the domestic market. HMSI currently has a market share of 43 per cent in the scooter segment with annual sales of 813,000 units.

Wednesday, March 23, 2011

Honda two wheelers to launch more auto-gear scooters

Honda Motorcycles and Scooters India (HMSI), country's market leader in auto-gear scooters, announces their plans for the coming years declaring more auto-gear scooters on their way.

"We are the market leader in gearless scooters. With demand for gearless scooters to grow in the domestic market, we are upbeat on this segment. Going forward, HMSI sees 40% business from scooters and 60% from motorcycles," said HMSI's President and CEO, Mr. Shinji Aoyama.

With good sales figures of 16.5 lakh units in last fiscal, HMSI is aiming to touch 21 lakh sales mark this fiscal and claiming the number one spot in the next decade. "We are very happy for the support from the people (in India). We need the same support to be number one in the next decade in India,"  said Mr. Aoyama adding "Our products are more in demand in the domestic market. Currently, we have 2.6-lakh waiting customers and plan to increase the capacity to meet market demand".

HMSI is also to expand their plant in Tapukara, Rajasthan to an initial capacity of 6 lakh units which is soon to be doubled. The company has invested Rs. 1000 crore on this new plant.

In the motorcycles department, Honda is launching next month the 250-cc version of its veteran  CBR called the Honda CB250R which is to be priced at Rs. 1.50 lakh.

Monday, March 21, 2011

Scooters India assemble on disinvestment reports

The heavy industries ministry has cleared outright sale of sick state-run companies Scooters India and HMT Bearings in a clear departure from its divestment policy that focused on sale of small stakes in profit-making firms.

The government holds 95% in Scooters India and 97% in HMT Bearings through HMT. The two companies together incurred losses of around 37 crore in the fiscal year ended April last.

Friday, March 18, 2011

Feeling of heat in “Japanese zone” in Jaipur

The industrial complex Majrakath at Neemrana, which has gained the name Japanese zone' because of a number of Japanese units coming up there, is in a state of uncertainty because of the crisis in tsunami-hit Japan.

The Rajasthan Industrial Development and Investment Corporation (RIICO) was successful in developing the Japanese zone in an expanse of 1166.63 acres. In all, 124 plots ranging from 4000 square metre to 40,000 square metre have been created and 20 plot allotments have already been made.

According to the MD of RIICO, Rajendra Bhanawat, nine projects have already begun trial production. These are for manufacturing of automobile brakes components and assemblies, PP compounds, cylinder liners, air conditioners & chillers and slide adjusters.

Now uncertainty looms large on the first such exclusive enclave in the country which has come up after RIICO reached an understanding with the Japan External Trade Organisation ( JETRO) to develop a zone on 1100 acres. Japanese investment worth $450 million have already come to Neemrana from Japan.

At RIICO's headquarters at Jaipur, no official was willing to talk about the impact on Neemrana's Japanese zone will have because of the crisis in Japan.

Japan is the sixth largest investor in India in terms of FDI with $22 billion invested in the last 10 years. Nearly 70% of this have come in the last three to four years. Of the portfolio flows that have come to India in recent times, Japan accounted for $8 billion. Out of which Neemrana received only $450 million. But the expectations were still high for future.

Analysts in Jaipur now expect that the Japanese economy will take longer than expected to come out of its current soft patch owing to the earthquake and tsunami. In a highly integrated world, it is impossible to escape aftershocks of a crisis like the one in Japan.

Last year, Honda Motorcycles and Scooters India Ltd (HMSIL) commenced construction of its two-wheeler manufacturing plant in Khushkhera industrial area. HMSIL planned to invest Rs 1100 crore in the unit employing 13,000 persons directly and indirectly and with the HMSIL coming to Khushkhera it was hoped that Tapukra, Neemrana and Khushkhera would become an automotive hub. But the uncertainty in Japan has put a question mark on the future. This company was to produce 12 lakh two wheelers annually.

The Honda group of companies is already setting up two green field projects in the Bhiwadi region. Honda Siel cars India Ltd (HSCIL) is setting up a car unit with an installed capacity of atleast 50,000 cars per annum.The project, which was to attract an investment of Rs 2000 crore, has now suffered a jolt because of the crisis in Japan. The company is currently manufacturing sheet metal parts, crank shaft and connecting rods with an investment of Rs 800 crore.

Nissin Brakes India Pvt Ltd, manaufacturing brake components and assemblies, Mitsui Prime Advanced Composites India Pvt Ltd manufacturing PP compounds, TPR Autoparts Manufacturing India Pvt Ltd manufacturing cylinder liners, Daikin Airconditioning India Ltd manufacturing air conditioners, Immasin India Pvt Ltd manufacturing slide adjusters, Toyoda Gosei India Pvt Ltd manufacturing auto components Daini Colour India Pvt Ltd manufacturing chemical compounds and Mikuni India Pvt Ltd manufacturing

auto components have already started production and three more companies were expected to start production soon.

"It is certain that such units that have invested considerably would continue to operate from the Japanese zone. But new investments in the next two years are unlikely because of the current situation in Japan," said an official of RIICO.

Wednesday, March 16, 2011

TVS Motors to return electric scooters market

TVS Motors on Friday said it was planning to re-enter the electric scooters market in the next financial year. The company has already developed an electric variant of Scooty Teenz, along with another new product for the domestic market.

H S Goindi, president (marketing), TVS Motors said, “We are testing 50 electric scooters in towns across the country. Depending on the feedback, the scooters will be launched sometime in the next financial year.”

The scooters would be rolled out from the company’s facility in Mysore and the company would initially use lead acid batteries for the electric scooters. “Business in electric scooters picked up in India a few years back, but dropped due to issues with battery technology and the withdrawal of subsidies. There is potential in the market, with the government announcing a national mission for promoting electric and hybrid vehicles. We see some proportion of sales coming from this segment over the next five years,” Goindi said.

In April 2008, TVS Motors had launched the ‘Scooty Teenz Electric’, for which the company targeted sales of around 40,000 units per year. However, it stopped production in May 2009, as the product received a lukewarm response.

Goindi said TVS Motors is studying the impact of the rise in commodity prices on the company’s margins and a decision on price rise is likely to be taken next month.

Meanwhile, the company on Friday launched its premium bike, ‘Apache RTR 180’, which boasts of anti-lock braking system technology and is priced at Rs 78,880 (ex-showroom, Delhi).

Tuesday, March 8, 2011

Yamaha in manufacture of scooter for India mkt in Japan

India Yamaha Motors India is gearing up to foray into the fast growing scooter segment in the country with an all-new product that parent Yamaha Motor Corporation (YMC) is developing specifically for the Indian market.

Roy Kurian, national business head, India Yamaha Motors, said, “We were studying the Indian market intensively over the last two years to gauge the requirements of customers here. We decided we needed a new product for the consumers here. A product is in development at our R&D centre in Japan, which would be introduced shortly.”

Industry sources indicate a gearless scooter from the Yamaha fold is likely to hit Indian roads by the end of next year.

Kurian, however, declined to specify a definite timeline and technical specifications of the scooter the company is considering for introduction in the Indian market.

Scooters, at present, account for nearly 18 per cent of sales in the overall two-wheeler market in India. The segment is posting strong growth numbers with sales increasing by around 47 per cent between April and January this financial year to 1.7 million units. An electric scooter may also be launched for India in due course.

Additionally, the company is also considering introducing two new motorbikes in India in the course of the year, which may include possible upgrades.

Kurian added, “We want to consolidate our position in the market here. We sold 2.5 lakh units in India last year. This year, we expect to grow by at least 50 per cent and then double the growth rates recorded by the overall two-wheeler industry in the country.”

India Yamaha Motors has sold 228,378 motorcycles in the domestic market till January this year, which is an increase of 21.28 per cent as compared to the corresponding period of the last financial year.

The motorcycle segment in the period has grown by 23.57 per cent to 9.7 million units.

Yamaha, which has 13 models in its portfolio in India, is targeting having 10 per cent share of the two-wheeler market over the next three to four years. The company’s current market share stands at 3.5 per cent. To this end, the company has launched six products in the 150 cc segment and is looking at attaining 20 per cent share in the category in the course of the year. “We are going to introduce top-end products in India and then work our way down the pyramid to lower segments. Our products are known for their technology and now we are seeing demand for 150 cc bikes even from the B and C category towns,” said Kurian.

The company which has two facilities at Surajpur in Uttar Pradesh and Faridabad, Haryana has a combined installed capacity to roll out six lakh units annually.

The capacity can be scaled up to manufacture nine lakh units per annum depending on demand. Yamaha sells products in India through its network of 400 dealers across the country.

Last year, the company had said it would focus more on the Indian market, with more investments, and aimed to have 10 per cent of its total global sales from the country within the next four years.

Monday, March 7, 2011

Bajaj Auto faces uneven ride in Indian car market

Abhijit is fiercely proud of his Kawasaki Bajaj motorbike and considers himself a company loyalist, but such attitudes could be a stumbling block for auto firms when it comes to promoting cars, analysts say .

"Motorbikes are the best for urban travel. They're economical and easy to park," the Mumbai sales executive in his 30s told AFP.

But while Abhijit, who uses only one name, wants to upgrade to four wheels, he is not yet sure whether he will stay true to the Bajaj brand, even though the company has announced that it is looking to get into the small car market.

"You know what you're getting with bikes and scooters," he explained. "A car from Bajaj? I'm not too sure."

Bajaj is India's second-largest manufacturer of two- and three-wheelers, and its name is synonymous with auto-rickshaws in the country, the world's largest market for such vehicles.

The Indian car market, where nearly two million new cars were sold last year, is increasingly crowded and cut-throat.

"Bajaj has the right DNA to make a car but not the experience," said Hormazd Sorabjee, editor of Autocar India magazine.

"It won't be easy. It will be a steep learning curve," he told AFP.

Bajaj Auto has tied up with French car giant Renault to produce, market and sell what it says will be a "pathbreaking", ultra low-cost, fuel-efficient minicar. The vehicle is slated to be launched next year.

The move makes strategic sense with small cars increasing their presence on India's roads ever since the launch of the Maruti 800 in 1983 -- the product of a partnership between Maruti Udyog and the Suzuki Motor Corp.

Nowadays, its successor the Maruti Suzuki Alto is the country's most popular small car, with Hyundai's Santro also a firm favourite among urban drivers.

Car penetration is low, with just 13 out of every 1,000 Indians owning one. But the market is the second-fastest-growing in the world, with sales forecast to rise by at least 25 percent in the current financial year, according to the Society of Indian Automobile Manufacturers trade body.

Two-wheelers remain India's favourite form of transport because of their low cost and easy maintenance, with motorbikes now accounting for 80 percent of the market, a turnaround from just a few years ago when cheaper, smaller scooters dominated.

Almost all of Bajaj's two-wheeler sales are now motorbikes, and Mahantesh Sabarad, an auto analyst at Mumbai-based Fortune Equity Brokers, said that the firm's focus on more powerful machines has paid off.

"The company has seen a rise in profits over the past decade even as scooter sales and market share dropped," he added.

But while the business, based in Pune, 170 kilometres (110 miles) southeast of Mumbai, has 50 years of manufacturing experience, a Bajaj car may be a harder sell.

Even Tata Motors -- one of India's leading vehicle makers -- has found the going tough.

It has tried to capitalise on the aspirational value of cars to Indians -- and their traditional eye for a bargain -- with the Nano, launched in mid-2009. Selling from just 100,000 rupees (2,500 dollars), the no-frills vehicle is the world's cheapest.

Nonetheless in November last year Tata said sales had slumped to just 509 units, forcing it to offer a string of after-sales perks to tempt new buyers. Sales have rallied but still just over 83,000 have been sold overall -- well below initial expectations.

Rajiv Bajaj has said his company's aim was to deliver a car with "mileage of 30 kilometres to a litre of fuel (71 miles to the gallon)". The company has refused to divulge any more details on the new car or its business strategy.

For his part, Sabarad said that whatever form the car takes, it will need to be a little more luxurious than the Nano.

"The Tata Nano experience shows that Indians do not necessarily like a bare-boned car. They like their car to be small but packaged with all the comforts of a full-sized one," he added.

Thursday, March 3, 2011

Rajiv Bajaj says focus on bikes, No comeback in scooters

The country's second-largest two-wheeler maker Bajaj Auto today reiterated it will not make a comeback to the Indian scooter segment in immediate future as it aims a bigger share in the global motorcycle market.

"We are a motorcycle company and we will remain focused on motorcycles," Bajaj Auto Managing Director Rajiv Bajaj said at an All India Management Association conference here.

He was replying to a query on reports quoting the company Chairman Rahul Bajaj that Bajaj Auto may consider re-entering into the scooter market.

"The world market for motorcycles is of 35 million units and Bajaj will end this fiscal by selling only 3.5 million units. We have a market share of 10%, and so we have headroom for 90% growth," Bajaj said.

In the April-January period this fiscal, the company sold 19,89,377 bikes in the domestic market as against 14,11,259 units in the same period last year, up 40.96%.

Bajaj Auto's export during the period has also grown by 35.78% to 8,36,617 units as against 6,16,135 units in the same period a year ago.

When asked why the company stopped production of its scooters, Bajaj said: "We did not phase out, but people stopped buying scooters."

In December 2009, the company had announced that it would stop making scooters by end of 2009-10 fiscal, thus bringing down the curtains on 'Hamara Bajaj', which revolutionised the two-wheeler market in the country.

However, since the auto major stopped making scooters, the segment has witnessed a significant growth, led by gearless scooters from Honda Motorcycle & Scooter India, which is the market leader in the segment now.

In the April-January period this fiscal, the Indian scooter market has witnessed a growth of 46.57% at 16,97,204 units as against 11,57,902 units in the comparable period last fiscal, as per Society of Indian Automobile Manufacturers Association (SIAM) data.

The Pune-based two-wheeler maker on the other hand is focusing on motorcycles, offering a range of models such as Discover, Pulsar and has even increased stake in Austrian bike maker KTM Power Sports AG to nearly 38.09% as it looks to expand presence globally.

Bajaj Auto and KTM have been jointly developing products and the first of the co-developed products, KTM Duke 125, will hit European markets this year. The KTM models are supposed to be launched in India during the second half this year.

Monday, February 28, 2011

Stake sale likely in HMT Bearings and Scooters India

BS reported that the Indian ministry of heavy industries and public enterprises is considering an outright sale of government’s stake in sick public sector units HMT Bearings and Scooters India.

While HMT Bearings had reported a net loss of INR 15.3 crore for 2009-10, Scooters India had registered a net loss of INR 22 crore.

A senior ministry official confirmed the development and said the proposal had been sent to the cabinet for approval. The official said that “We are considering selling the government’s entire stake in Scooters India and HMT Bearings, as both are in bad financial position.”

He said that “Competitive bids would be called for offloading stake in the companies. The companies can be revived with fresh capital infusion by the new owner.”

Last year, the ministry had approved a 74% stake sale in the loss making two and three wheeler maker Scooters India. The then heavy industries minister, Mr Vilasrao Deshmukh had said Mahindra & Mahindra was interested in buying the government’s stake in the company. However, the process was stalled following opposition from other ministries.

The government owns 95.4% in Scooters India. Buyers are expected to show keen interest in the company, as it owns 150 acres of land, worth more than its accumulated losses of INR 826 crore. The government had infused 600 crore into the company in 1996, but the move failed to revive the company.

HMT Bearings has cumulative losses of INR 81 crore. Production has declined over 60% over the last three years due to inadequate availability of raw material, arising out of shortage of working capital. The company’s revival plan is also affected, as it has failed to secure a loan of INR 17.4rore against government guarantee. The loan has been pending since 2006. HMT Bearings is trying to sell surplus land around the factory’s premises in Hyderabad to infuse working capital.

While the move, if approved, may breathe new life into the two entities, concerns persist as the ministry’s earlier proposals of outright sale of sick state-owned units, such as Indian Telephone Industries, had met with stiff opposition from trade unions and political parties, both in the opposition and the ruling alliance.

Wednesday, February 9, 2011

Govt could sell its all stake in Scooters India

He said unless Scooters India Ltd (SIL) gets fresh capital infusion, it cannot survive for long as it is not in a good financial position.

Government was earlier considering a joint venture with private sector for revival of SIL, which has piled up a loss of Rs 22.03 crore in the fiscal 2009-10.2nd hand cars

Patel had earlier said that there was an "absolute" case for privatisation of the PSUs which have remained closed.

Government holds 95.38 per cent in Scooters India.

Its Shares hit the upper circuit today and jumped 10% to Rs 28.15 on the BSE.

Located near Lucknow, Scooters India is an integrated automobile plant, engaged in designing, developing, manufacturing and marketing a broad spectrum of conventional and non-conventional fuel driven 3-wheelers. Mahindra First Choice

Monday, January 31, 2011

New Generation Gearless Scooters

Scooter manufacturers, especially those who have introduced new-generation gearless scooters, are enjoying the fruits of their labour, as sales have continued in top gear in December.used autos in India

Surprisingly, December sales have made current market leader Honda Motorcycle & Scooter and Bajaj Auto, the erstwhile leader in the scooter segment, mere spectators, as other manufacturers enjoyed bumper sales, that too in the last month of 2010. Auto sales in December are often lower compared with previous months.

In December, TVS Motor and Hero Honda Motors witnessed sales growth of over 100%, while sales for current market leader Honda grew by just 9%. Others, like Mahindra Two Wheelers and Suzuki Motorcycle India saw their scooter sales increase by 72% and 71%, respectively. However, looking at these bumper sales figures, one cannot but help feel bad for Hamara Bajaj, which last year decided to exit the scooter market.

Honda remained the market leader with sales of 76,307 units, taking its nine-month sales (April to December 2010) to 6,65,051 units from 5,22,399 units in the previous corresponding period. However, despite finding favour with customers, the company is still finding it difficult to deliver scooters in time. According to sources, Honda Activa has a waiting period of six to eight months.Tata Showrooms in India

This waiting period for an Activa is proving to be beneficial for others like Hero Honda and TVS Motors. Especially TVS, which has seen demand soar for its newly-launched Wego scooter, on easy availability and a loyal customer base built around its Scooty brand. Hero Honda, on the other hand, has benefitted from its brand image and large dealer network. Increased demand and non-availability of Activa may have played an important role in people trying out the models of other manufacturers.electric bikes in India

While, TVS's Wego, Mahindra's Rodeo and Duro and Suzuki's Access do have features similar to Activa, people did not think much about these products previously. But since the delivery time for an Activa has increased, those not prepared to wait long are turning to other models, and this is propelling sales of Wego, Access, Rodeo and Duro.

During the nine months do December, scooter sales rose 49.2% to 14,92,342 units, while motorcycle sales increased 24.6% to 66,54,280 units. This makes one wonder about the decision by Bajaj to 'sacrifice' scooters to push its motorcycle business.

One of the problems has been that while all scooter makers launched products based on fresh R&D and improved features (such as auto gears), performance and mileage, Bajaj did not make much of an effort on this front. The company continued with its iconic (now defunct) geared scooters.maruti second hand

In effect, Bajaj's scooter segment appears to have died an unnatural and untimely death, mainly due to the lack of support from the family. Last heard, managing director Rajiv Bajaj has said that the company would drop the name 'Bajaj' from its products, showrooms and service centres and re-brand them as 'Pulsar' or 'Discover', after the names of two of the company's best-selling motorcycle variants.

Monday, January 24, 2011

Piaggio More Components For India

“At present, we source 50 per cent of components for our global operations from India and same amount from China. We want to source components from India as much as possible,” Gregorio Alessio Ruffo, global purchase India and development, Piaggio & C. s.p.a. told Financial Chronicle. Tata Dealers In India At present, Piaggio has a vendor base of 100 suppliers in India that provide components for two-wheelers and light commercial vehicles valued at a total € 40 million (Rs 245.2 crore).

A couple of years ago, the company had set up a global purchase office in India, keeping in mind the quality and cost advantage over European suppliers. “As we launch a range of scooters with an engine capacity of 125cc to 200cc, we will be able to expand the supplier base further,” said Ruffo.

The Italian two-wheeler major also plans to introduce its mass commuter segment motorcycles with an engine capacity of around 125cc to 200 cc sold under its global brands Aprilia, Derbi and Scarabeo among others, in India. “We are evaluating the launch of our motorcycle with 125cc engine in the Indian market. For the low-powered motorcycle, we can achieve nearly 50 per cent localisation as it would have a common vendor base with our scooters,” he said.

Piaggio Vehicles, the Indian subsidiary of Piaggio group has invested €30 million (Rs 183.9 crore) to set up a greenfield two-wheeler manufacturing facility in Baramati in Maharashtra. “The facility will have a capacity of 1.5 lakh scooters annually.Indian electric bicycles We plan to achieve 1,00,000 sales volume for the Vespa LX125 that will be launched in January 2012,” said Ravi Chopra, chairman and managing director, Piaggio Vehicles. India’s scooter sales grew by around 49 per cent year on year to 15.17 lakh over the April-December 2010 period.

Tuesday, January 18, 2011

TI Cycle's Power Scooters

TI Cycles of India, a part of the Murugappa group, expects to grow its electric scooters and bicycles business by 50 per cent in the next financial year, on the back of a renewed interest in electric bikes and with new products, especially the ‘Pedelec', a battery-powered bicycle.

TI Cycles, which is a division of Tube Investments of India, expects its electric vehicles business to earn revenues of Rs 30 crore this FY and “our anticipation is that we will grow the business by 50 per cent in the next financial,” said Dr D. Raghuram, President, TI Cycles. The TI Cycles division made Rs 960 crore in revenues in the last year.

On Monday, Mr A. Vellayan, Chairman, Murugappa Group, received at Dare House, the Murugappa group's corporate headquarters in Chennai, a team of six senior executives of TI led by Dr Raghuram, who had completed a 743-km, coast-to-coast ride from Kollam in Kerala to Chennai.

Dubbed the ‘BSA Hercules electric coast to coast' ride, the team took six days to travel the distance. The idea was to test its electric bikes under all conditions, said Dr Raghuram, and also interact with dealers, school children, customers and promote its ‘faster, fitter and greener' platform.

The Pedelec, powered by a 24 volt battery, which makes cycling easier for the rider, will be launched by March. To be priced in the band of Rs 7,000 to Rs 12,000, the Pedelec, pointed out Mr Rajesh Mani, General Manager, Marketing, will provide a youngster looking to buy an unaffordable two-wheeler an option to own a motorised two-wheeler which is safer and ‘greener'. On a single charge, which could take between 8 and 10 hours, the cycle's battery, along with some pedalling, can last for 40 km. Imported till recently, the batteries are now made by Exide for TI.

TI also expects its BSA electric scooters to get a boost from the subsidy of Rs 4,000 per bike announced recently by the Ministry of Renewable Energy. The subsidy will be given to manufacturers who have 30 per cent indigenised content. This, said Dr Raghuram, is a welcome break, even though it does not match the Rs 10,000 subsidy given by the Delhi Government which helps TI price its scooters at around Rs 16,000 approximately for its lowest-end version which is powered by a 250 volt battery. In other markets, the prices range from Rs 25,000 to Rs 40,000, the latter being the higher-powered 800 volt version. The 250 volt version does not require a licence to ride.