Indian manufacturers seek financial relief
November 12, 2008 by Matt Brogan
Suffering from tighter credit and falling sales both locally and abroad, India’s automakers and suppliers are asking the government for financial relief.
The industry seeks a lower customs duty on metal imports, extensions of loan repayment schedules for smaller manufacturers and large infrastructure projects, including roads.
“The industry needs an immediate package to survive the current economic crisis,” J.S. Chopra, President of the Automotive and Component Manufacturers Association of India said.
With vehicle demand slowing, especially for commercial vehicles, several suppliers said that automakers were delaying payments and that loans to fund capacity expansion were difficult to get.
Some manufacturers have also slowed production with Ashok Leyland Ltd., the second-largest manufacturer of commercial vehicles, saying it would halve production until December at the earliest.
Tata Motors Ltd., the third-largest passenger-car manufacturer, said plants in Lucknow and Pune would halt production for six days this month. Tata also planned a two-day shutdown of a heavy-vehicle plant in Jamshedpur.
Mahindra Renault Ltd., a joint venture of automaker Mahindra & Mahindra Ltd. and Renault SA, will drop production of the Logan (pictured above) from 2,500 units a month to 1,000.
A drop in global sales, led by U.S. automakers, has cut revenue as much as 30 percent for some parts suppliers. The Automotive and Component Manufacturers Association estimates that India’s auto parts industry will grow by no more than 6 percent this year, compared with an average growth rate of about 25 percent for the previous five years.
India’s car market, among the fastest-growing in the world, dropped seven percent in October, which is usually considered a peak selling month when customers take advantage of “festive offers” during the wedding and Diwali season (a time when Indians buy new items for the home).
But with high interest rates (around 16 percent), demand has slowed considerably. It is hoped a government funded stimulus package with help turn things around.
Print it: 
Surely this can’t be true.
According to Silky (see story on Aust govt assisstance package), there is nothing wrong with the industry, here or overseas, it’s just Ford and GM — or maybe Silky really is just spinning more pro-toyota bs.
Love the look of the hatch in the first image
Hey Mitch,
It’s a Suzuki concept called the “A-Start”. Will be built at Suzuki’s Indian manufacturing site if given the go ahead.
Matt.
Same here mitch, that hatch looks pretty good
They need more than financial help, they need psychiatric help for desinging and Making such DISGUSTING ugly cars, they better not come to australia….god help us..s
@ Marcoz
All Suzuki Swifts sold in Australia are manufactured at Suzuki\’s Indian plant. The invasion has already begun :)
Better than those gas guzzlers (Commodore & Falcons) IMO.
What is the use of having so much of power when it is illegal to go over 110 km/hr??
I\’d be happy with a 2 litre – 150 bhp engine.
bhp, what are you talking about Floyd? The last time I ckecked we were using the metric system of measurement. In fact we have been doing so since 1974.
Your talking about the SX4 Floyd its 107kw. Its stated fuel economy is 8.5l per 100km manual and 9.5l per 100km auto.
So it’s not that much better than Falcon and Commodore. All relative to what and how you use the vehicle IMO.
Bret Says:
November 12th, 2008 at 10:56 am
Damn I hate it when someone beats me to the punchline.
See also the China Auto industry… Oh and the european and the Japanese, Malaysian, Taiwanese and the one in Thailand.
Matt,
is the “A Start” perhaps a swift replacement??
the country where I am originally from still uses bhp as metric system of measurement of power and calculates Fuel efficiency in terms of kmpl. Still not used to the Australian measurement system.
Sorry my bad.
@ Andrew
The A-Star is supposed to be slotted just below the Swift according to Team-bhp forum.
Here’s some info about the car I found on that forum.
“The maruti Suzuki A-star is all set to hit the roads next week has returned a mileage of 19.59 km per litre (5.104l per 100kms).
It’s powered by a 1.0L,3-cylinder 12 valve unit developing a maximum power output of 65bhp (48kw).”
Would make a good city / girl’s car IMO.
My current fav’s are the Ford Mondeo & Chevrolet Cruze.
Apparently there are more millionaires in India than the UK, so for the last ten years the capitalist there have been raking in the millions now they suffer. All this means that the manufacturers will discount cars which in turn means our current cars values will plummet. Why anyone would by a new car for it to be worth 30% after 3yrs is beyond me, except those in business who can write down the depreciation. Awww shucks i’m just jealous.
What’s with all these stories on car manufacturers asking for financial aid?
My business is also suffering, I’d like to ask for some financial aid from the Government. How does one go about doing this? Surely they’d be more interested in giving me a couple hundred thousand dollars than forking over a couple of million to a dying car manufacturer.
What makes them so special? Businesses rise and fall every day. Adding money into the bank account won’t fix your problems. Maybe look at your management and structure. Spend what little money you have left on some good advice you twats.
SteveC
well said SteveC.even my company is suffering who will bail me out?
I guess they just see it as an easy way to gain fast cash.
What surprises me is the top management still happily take home million dollar packages but have no problem in leaving their factory workers without a job.
Well said SteveC and Rocket_V6.
See my post under “GM asks for financial assistance”.
nice blog. i have read comments of other users and i find that this is very useful resource.