Maruti Suzuki unveils new plant in Manesar, to invest $416 mn
NEW DELHI: India's leading car maker, Maruti Suzuki, said on Tuesday it would invest 35 billion yen ($416 million) to build a new factory to meet growing local demand.
"We had not estimated the pace at which car demand would grow (in India)," the chairman of Suzuki Motor Corp, Osamu Suzuki, said in a speech to Maruti Suzuki shareholders.
Maruti, which has a strong following among India's growing middle class, is already producing at full capacity and has long waiting lists for some popular models.
The new factory will be the third unit at Maruti's complex in Manesar, Haryana, which is about 30 kilometres (18 miles) from New Delhi. The plant will lift the company's total production to 1.75 million units a year.
India has posted blistering car sales growth, with more than half a million sold in the first four months of the current fiscal year.
Car sales in India hit a record high in July on the back of soaring demand in rural areas, jumping 38 percent to 158,764, compared with 115,084 in the same month last year, according to industry figures.
Source : Economic Times
Ssangyong buyout to be debt free
CHENNAI: Automotive major (M&M ) said it would aim to bring Ssangyong Motors of Korea, (for which it has been selected as the preferred bidder), into its fold “near debt free” .
“We want Ssangyong to come into M&M fold with a clean slate,” Rajesh Jejurikar, chief of operations of automotive sector of M&M , told TOI. There are also plans to infuse significant cash into the bankrupt Korean company , on which Jejurikar did not elaborate. It is learnt that M&M would infuse nearly $400 million as equity into Ssangyong to acquire a controlling stake. These funds would be used to repay all long-term debts at around $320 million as of March 2010 post restructuring.
“As per our estimates, we hope to bring the Korean company into our fold by December this year or latest January 2011. The company has a positive EBIDTA (or operating profit) of nearly 2%,” he said.
While Ssangyong has a chequered history, recent performances suggest a turnaround in fortunes. For the first seven months of 2010 the company’s sales are 25% higher than the full of 2009. The labour force too has been restructured reducing fixed costs by nearly 37%. Ssangyong posted a positive EBIDTA in the first quarter of the current fiscal after a gap of seven quarters.
On the domestic front, M&M is stung by shortage of tyres, castings and fuel injection pumps. “We are losing nearly 1,500 to 2,000 vehicles every month in sales due to supply-side constraints . We are trying to address these component issues. It might take a while before we get back into full steam of delivering market requirements,” Jejurikar said.
Source : Economic Times
Did Tata Motors buy the brand for the 2011 Jaguar XJ?
MONTEREY, Calif. – Do you believe in love at first sight? Consider this: One look was about all it took when executives of Tata Motors, who in late 2007 were deciding whether to buy Jaguar from Ford Motor, saw sketches of what would become the 2011 XJ.
“What we had coming to market,” Gary Temple, president of Jaguar North America, said in a recent interview, “was what made them buy the company.”
Developed largely before Tata, of India, took over, the new XJ is a bold, mold-breaking styling statement. The old XJ’s long-running retro theme – traditional grille, quad headlamps, sculptured hood, low beltline and long tail – has finally been exorcized. While unmistakably a Jaguar, the new XJ is a thoroughly modern, flamboyant, unfettered expression of luxury.
Some loyalists feared that such a radical departure might alienate the typical Jaguar owner (known inside the company as the fictional “Mrs. Schwartz on Long Island”).
But based on early sales figures, two things seem apparent. The Jaguar faithful (presumably including Mrs. Schwartz) are still happily on board. And the new car’s wow factor has smitten those who thought the XJ had become too old-school.
For more than 40 years, the XJ has been Jaguar’s flagship. When originally introduced in 1968, the company’s founder, Sir William Lyons, appeared in grainy television commercials extolling it as “the greatest Jaguar – ever!”
Indeed, while the original XJ was a landmark car – it has been called the most beautiful sedan ever – the XJ’s iconic status within the company has for decades cowed those who longed for a bold update. The previous three major redesigns hewed closely to the look of the original.
“We were almost afraid to mess with it," Temple said. “There was a limit to how far we wanted to take the design; we didn’t want to lose the look we had nurtured for so long. But in doing that, to some degree, we will admit we lost our way.”
Well, then, welcome back.
“We are trying to bring the word ‘sleek’ back to Jaguar styling,” said Ian Callum, the chief designer. “It has not been easy.”
As an example, Callum cited the new instrument panel: “It’s nine inches lower than the previous car’s dashboard. That wasn’t just all hollow space behind there; it was full of components. All those things had to be relocated.”
The lowered dash gives the cabin a feeling of spaciousness – it seems much larger than its predecessor. “It’s not,” Callum assured me. “We’re talking about millimeters.”
The new interior ranks among the most elegant in the auto industry, irrespective of price. I slipped into the cabin of a top-line Supersport XJL, which is offered only by special order at a starting price of $114,075; it was like being admitted to an exclusive English club.
The scent of glove-soft leather was intoxicating; the seats are a select “aniline” hide, with contrasting piping and embossed headrests. There is leather, leather and more leather – on the headliner, the door posts, the dash, the backs and sides of the seats, the console.
My only wish was for a wood-trimmed steering wheel instead of one wrapped solely in leather.
The cabin is rimmed with choice wood – materials other than wood, like carbon fiber, are available – forming what Callum calls the Riva line. It is meant to evoke the shape of a classic Riva Aquarama mahogany speedboat.
Source : Economic Times
M&M non-committal on retaining SsangYong staff
NEW DELHI: Mahindra & Mahindra (M&M) has not made any commitment on retaining jobs or volume growth in its deal with SsangYong Motor to buy a majority stake in the ailing South Korean automaker.
The memorandum of understanding (MoU) between the two companies, signed on August 23, only offers to “honour” the current wage agreements that SsangYong has signed with its unions, said Pawan Goenka, president, automotive & farm equipment division, M&M.
“M&M’s MoU with SsangYong honours the current wage agreement that the company has with the unions,” he said. “We will hope to grow employment as the volume grows though we have no specific commitments.”
This is crucial given SsangYong’s history of labour problems. The company faced a devastating strike last year that severely hit its production and profitability and prompted the management to cut its work force by almost one-third to more than 4,000 from around 7,000 workers.
Auto analysts say the flexibility on the headcount front will help M&M turnaround the company faster. “Labour is always a critical component of a big deal like this... In SsangYong’s case it’s even more critical given its track record and any flexibility on this front will help M&M,” said the principal analyst of a Delhi-based multinational consultancy firm who requested not to be named.
M&M has been chosen preferred bidder for the sports utility vehicle maker and has already paid 5% of the deal amount. It will start confirmatory due diligence on Monday, which will last five to six weeks. The deal is expected to close by November.
Analysts say one of the reasons why Ssangyong’s earlier owner, Chinese firm SAIC, could not turn around the SUV maker was because of problems and trust issues between the union and the new management. M&M has, however, indicated it has no plans to cut jobs after the acquisition.
During the JLR deal, Tata Motors had to work closely with Unite, the JLR unions, to take care of worries over jobs and pension and other benefits. Immediately after the deal went through, the global recession hit the company badly and Jaguar Land Rover announced a restructuring plan that included closing of one of its three plants as well as voluntary rightsizing.
Earlier this year when JLR chief David Smith quit, there were reports that he had faced disagreements regarding a new pension and work conditions scheme at JLR though both the company and parent Tata Motors denied it.
Source : Economic Times