Tyre Prices Shooting Up In India
There has been an increase in the prices of the car tyes. And the 7 per cent increase for the tyre price is because of the high demand and low supply. The car owners actually need not spend an extra 5 to 7 per cent. But it is the carmaker who needs to shell out an additional cost of Rs.800 for a new tyre for every new car they sell.
A deficiency of tyres in the market has become the reason for decrease of inventories at tyre makers to just 5-7 days from 20-25 days. And this is seriously affecting car manufacturers such as Maruti Suzuki, Hyundai Motor India, Tata Motors, General Motors India and Ford India. There isn't any clear information on how much are the carmakers affected by this situation.
"There is a demand-supply mismatch. While production has increased in the past few weeks, the supply of tyres has not kept pace, resulting into shortages. We have asked tyre companies to augment supplies but that has not happened yet," a senior executive at Tata Motors said.
Auto makers assume that tyre companies are charging arbitrary prices. But the tyre makers are of the opinion that they are trying to meet the demand despite production constraints.
"Tyres are a capital-intensive industry and there has been no major capacity addition in a year due to slowdown in the market and economic recession. While sales have jumped in recent months, production has not increased to that level, leading to shortages," said a senior executive of a tyre company on condition of anonymity. It is expected that the price will be dropped once the festival season is over and the demand for cars come down.
Hero Honda posts highest-ever May sales of 22.5%
Hero Honda Motors Ltd (HHML), the world's largest two-wheeler manufacturer, keeps consolidating its market leadership. The company today reported sales of 3,82,678 units in May 2009 - its highest-ever sales for the month of May. This is a 22.5 per cent growth over the corresponding month in 2008, when it had sold 3,12,317 units.
This comes close on the heels of a 30 per cent growth in Hero Honda's April sales, when the company sold 3,70,575 units of two-wheelers. With this, Hero Honda's cumulative sales in the new financial year (April-May, 2009-10) goes up to 7,53,253, a growth of 25.8 per cent over the corresponding period last year when the company sold 5,98,569 units.
Hero Honda has been consistently building on its strong 58 per cent share in the domestic motorcycle market in the country, even as the uncertainty over interest rates and an overall credit squeeze continues to impact the industry adversely.
Mr. Anil Dua, Sr. Vice-President (Marketing, Sales & Customer Care), Hero Honda Motors Ltd said, "The strategic building-blocks that we put in place in the past couple of years have been key to our consistent growth month after month. Consistent product refreshes, aggressive network expansion, exploring new markets, clutter-breaking communication and ground activation have been the hallmark of this strategy. We have also built an extensive network of over 3500 touch-points across the country, which will be taken up to 4000 by the end of this year.
"Going forward, we will therefore also keep up our relentless effort to reach out to customers spread across the semi-urban and upcountry markets," he added.
Most of the new launches such as the Passion Pro, Splendor NXG self-start, the special edition Hunk, the new Pleasure, in addition to the trusted Splendor + and Passion Plus, have been share-and-volume drivers for the company.
Hunk and CBZ X-treme continue to help build on Hero Honda's steadily growing share in the premium segment. Hero Honda was given the "Trusted Brand" (Motorcycles) Award 2009 by Reader's Digest magazine in the month of May.
[Via: infibeam]
Bike sales grows, but at snail’s pace
Motorcycle sales have managed a modest growth between April-08 to Feb-09 despite the entry-level segment registering a decline. The on-going global economic slowdown played a key role in the slowing down of two-wheeler sales.
Adding fuel to the fire were the existing vehicle repossession norms and the lack of easy finance. The entry-level bike segment which accounts for around 70% of the two-wheeler market registered a decline in sales by almost 2%. A sales decline in this major segment should have caused a slump in the overall sales of the bike segment.
However, as per the latest figures from the Society of Indian Automobile Manufacturers (SIAM) the overall bike sales managed to grow by 51,687 units to a total of 53,13,145 units compared to 52,61,458 units in the last financial year. The overall two-wheeler sales were up marginally to 67,83,653 units from 66,18,302 units in the last financial year.
The entry-level market leader, Hero Honda was the sole manufacturer to register a gain by around 3 lakh units in the segment. Bajaj Auto sold around 2.75 lakh units less compared to the last fiscal year. TVS Motor Co sold 84,299 units less while India Yamaha Motor sold 23,353 units less compared to the same period last year.
Even in the executive segment Hero Honda registered a marginal gain while Bajaj Auto still sold lesser number of units compared to the last fiscal year. Overall sales in the executive segment increased to 15,29,362 units compared to14,09,380 units in the same period last year. The scooter segment grew overall to 10,59,054 units compared to 9,67,087 units in the same period last year. The sales of bigger scooters fell to 41,331 units compared to 58,880 units in the same period last year.
[Via: BIKE]
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