January Newsletter – 29/1/2020

Headlines

1) Amidst the slowdown, Honda Cars India floats VRS scheme for its manufacturing staff

Sighting the ongoing slowdown in the Indian automobile sector, Japanese carmaker Honda Cars India (HCIL) has floated a voluntary retirement scheme (VRS) for its permanent employees (for manufacturing) at the Greater Noida plant, effective from January 28, 2020. (Source: auto.economictimes.indiatimes.com)

2) Maruti Suzuki India announces price hike for select models

Maruti Suzuki India today announced a price hike up to 4.7 percent on select models due to an increase in the input costs. Although the new prices are effective today onwards, the carmaker didn’t disclose the models that see their prices going up. The new prices are effective from January 27, 2020. (Source: www.indiatoday.in/auto)

3) Companies issuing travel advisories: Corona clouds on China cos in India

China Inc has a big and growing presence in India. China-originated Coronavirus is a growing threat worldwide, including in India. Now, the two are colliding. There are concerns over Chinese executives who may be visiting India for the auto expo and Chinese companies’ India units are issuing travel advisories to their executives.

The biggest concern, SIAM officials said, is that the expo will be open to the general public from February 6. And that their questions to the ministry will include whether, given the considerable Chinese presence, there should be additional checks like thermal screenings, as have been installed at seven airports, at the venue entrances. (Source: economictimes.indiatimes.com)

Auto Components & Accessories

1) Subros slips after Q3 PAT declines 22%

Subros declined 2.96% to Rs 268.9 after the auto parts maker reported weak Q3 2019 numbers during market hours today. On a consolidated basis, Subros’ net profit declined 22% to Rs 13.35 crore in Q3 December 2019 as against Rs 17.09 crore posted on Q3 December 2018. (Source: www.business-standard.com)

2) India’s crude steel output rises 1.8 percent to 111.2 million tonnes in 2019: Report

Asia produced 1,341.6 million tonnes of crude steel in 2019. India’s crude steel output increased marginally by 1.8 percent to 111.2 million tonnes (MT) in 2019, according to the World Steel Association. (Source: www.thehindubusinessline.com/economy)

3) ZF wins U.S. approval to buy Wabco on condition of asset divestiture

German auto parts maker ZF Friedrichshafen AG won U.S. antitrust approval for its $7 billion deal to buy U.S. rival Wabco, the Justice Department said on Thursday.

To win approval, the government required the companies to sell Wabco’s steering components business, R.H. Sheppard Co Inc, since ZF and Wabco are the only North American suppliers of steering gears for large commercial vehicles. (Source: finance.yahoo.com/news)

4) ACMA Reiterates Need For Uniform 18% GST On All Auto Components

The Automotive Component Manufacturers Association (ACMA), the apex body of the Indian auto component industry reiterated the need for a uniform 18% GST rate on all auto components in its recommendations for the Union Budget 2020. (Source: www.business-standard.com)

Government Policy

1) Budget 2020 expectations: Automobile industry hopeful for right incentives for EVs, reduction in GST

PM Narendra Modi-led government prepares to present the first budget of its second term on 1st February, expectations run high among vehicle manufacturers with a hope that Finance Minister Nirmala Sitharaman would announce favorable policies and incentives. (Source: www.financialexpress.com/auto)

2) Government blocks Rs 40,000 crore GST claims on returns mismatch

The Central Board of Indirect Taxes and Customs (CBIC) has frozen tax credits of around Rs 40,000 crore as the returns did not match, exposing alleged fraud by close to 2,000 entities, apart from cases where returns were not filed. (Source: auto.economictimes.indiatimes.com)

Auto Industry

1) MG Motors targets expansion to 3-lakh units with fresh investment for India

British brand MG Motors has tasted success with Hector SUV and got a massive response to its newly introduced ZS EV. Its big bang debut at the Auto Expo 2020 will be a full line-up of compact, hatchbacks, sedans, SUV’s and the people mover Vans as it targets Indian customers across all segments. (Source: auto.economictimes.indiatimes.com)

2) Auto Expo 2020: Maruti Suzuki to display Futuro-E Concept, Vitara Brezza facelift

Maruti Suzuki will display an array of cars and technologies during Auto Expo 2020. During the auto show, the company will unveil three cars – Futuro-E Concept, as well as facelift models of compact SUV Vitara Brezza and hatchback IGNIS. (Source: www.businesstoday.in)

3) Auto sector needs sops to reverse structured degrowth: SIAM president

Rajan Wadhera, President, SIAM points out that in the past also, the government has extended support in 2009 and 2014 at times of degrowth. Also, we are hopeful that the finance minister will consider giving more money to people by reducing the income tax rates in the Budget. (Source: economictimes.indiatimes.com)

Four Wheelers & Two Wheelers

1) Honda Amaze launched with BS-6 compliant engines; prices begin at Rs 6.09 lakh

Japanese carmaker Honda Motor Company has updated its compact sedan Amaze in India with BS-6 compliant engines. The price for the updated Honda Amaze starts at Rs 6.09 lakh (ex-showroom, Delhi). It still has the same 1.5-litre diesel and 1.2-litre petrol engines. (Source: www.businesstoday.in)

2) Ather Energy launches its second e-scooter 450X at Rs 1.5 lakh, enters Delhi market in July

The Pawan Munjal-backed electric vehicle start-up Ather Energy, which has fast garnered a reputation for making high-end performance electric scooters, on Tuesday launched its second product, the 450X, at Rs 1.49-1.59 lakh. The company, which is so far present in just two cities – Bangalore and Chennai – also said it was entering four more cities – Delhi, Mumbai, Pune and Hyderabad – with the launch of this scooter in July. (Source: www.businesstoday.in)

3) TVS launches iQube Electric scooter

India’s second-largest scooter manufacturer TVS Motor Company has launched iQube Electric scooter marking its venture into the electric scooter segment. TVS’ iQube Electric scooter is powered by the company’s electric drivetrain and next-gen TVS SmartXonnect platform. It will be available in Bengaluru from January 27.
(Source: www.businesstoday.in)

Global Market

1) Auto Parts Maker BorgWarner To Buy Delphi Technologies In $3.3 Billion Deal

BorgWarner Inc., a large supplier of automotive powertrain parts, has agreed to buy Delphi Technologies PLC for $3.3 billion to expand its ability to supply hybrid and electric vehicles. (Source: www.forbes.com/sites)

2) Volvo Counting on Hybrid Cars to Avoid Paying Hefty CO2 Fines

Volvo Car AB is counting on tripling sales of plug-in hybrid models this year as a way to avoid paying what could amount to hundreds of millions of euros in European penalties for the sale of its more polluting yet popular combustion-engine SUVs.(Source: www.bloombergquint.com)

3) Global auto production may have peaked, Bosch says

Global automotive production may have peaked, Robert Bosch said on Wednesday, announcing job cuts and a review of its business to cope with a 44 percent drop in full-year operating profit and a downturn in demand for cars. (Source: europe.autonews.com)

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