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This week in Auto: Demand puts models on waiting despite down industry; EV-makers cut prices

Here is a look at all the developments in the automotive space that made headlines during the week

August 03, 2019 / 11:36 AM IST
Jawa 42 | Rs 1.65 lakh | The Jawa 42 is a slightly different take on the classic Jawa with lack of chrome and a single-pod instrument cluster. The 42 is also priced a little lower. It, however, gets the same 293cc liquid-cooled single-cylinder that produces 26.51 PS and 27.05 Nm.

Jawa 42 | Rs 1.65 lakh | The Jawa 42 is a slightly different take on the classic Jawa with lack of chrome and a single-pod instrument cluster. The 42 is also priced a little lower. It, however, gets the same 293cc liquid-cooled single-cylinder that produces 26.51 PS and 27.05 Nm.

 
 
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At a time when manufacturers and their dealers are busy offering mouth-watering discounts, a handful of models are defying the norm. The demand for them remains so high that some of them are not available for bookings. More on this later in the article, but, first, here is a look at all the latest developments in the automotive space that made headlines during the week.

Electric vehicle makers cut prices

Mahindra & Mahindra (M&M), Hyundai, Tata Motors, Ampere and Ather Energy cut prices of their battery-powered vehicles to the extent of the cut in GST. The GST council brought down the rates on electric vehicles to 5 percent from 12 percent to spur demand.

While M&M and Tata Motors cut prices of the eVerito and eTigor by Rs 80,000 respectively, Hyundai slashed a whopping Rs 1.5 lakh on the recently launched Kona. Two-wheeler makers like Ampere and Ather Eergy brought down their prices by Rs 5,000.

Motor vehicle bill becomes law

Rajya Sabha passed the Motor Vehicles (Amendment) Bill 2019 on July 31. The bill was approved in Lok Sabha on July 23. The upper house of the Parliament witnessed a heated debate as opposition members questioned the government’s haste in getting the bill passed.

The bill proposes the development of a National Transportation Policy by the Centre to set up guidelines for the transportation of goods and passengers

Tata Motors, Tata Power joins hands to install charging stations

Tata Motors and Tata Power on August 2 said it would install 300 fast charging stations by the end of this fiscal in five cities -- Mumbai, Delhi, Pune, Bengaluru and Hyderabad. As a part of the initiative, the companies inaugurated seven charging stations in Pune to enable the e-mobility drive in the city.

Over the next two months, it plans to install 45 more chargers across other four cities. The chargers will be installed at Tata Motors dealerships, certain Tata Group retail outlets and other public locations.

Tata Motors to add four EVs in 18 months

Tata Motors will have five electric vehicles on the roads in 12-18 months in an effort to capture the maximum share of the segment which is getting a major push from the government.

Speaking to shareholders at the 74th annual general meeting, Tata Motors Chairman N Chandrasekaran said, "In the next 12-18 months we will have five electric vehicles in the market. This will be the Tigor, electric Nexon, electric Altroz, a new Tigor with higher mileage and one more vehicle."

Tata Motors looking for partners for JLR

British automotive brand Jaguar Land Rover will have to scout for partners to fund its massive appetite of capital expenditure (capex), which was cut down by nearly a fifth by parent company Tata Motors during the last 12-18 months.

Chandrasekaran said that the company was evaluating proposals for a tie-up.

Rahul Bajaj hits out at the Center

Bajaj Auto Chairman Rahul Bajaj criticised the Centre’s lack of effort towards arresting the falling demand and boosting private investments. He was speaking to shareholders at the company's 12th Annual General Meeting.

The 81-year-old billionaire businessman did not mince words while highlighting the challenges faced by the auto industry, which recorded its eight consecutive months of sales decline.

Auto sales continue their slide

Increased prices and negative sentiments kept buyers away from showrooms in July, which continued the slump in sales of cars and SUVs through its ninth consecutive month.

Hikes on insurance premiums, and an increase in the cess on fuel also played their part to dampen demand for the month. The fall comes despite high discounts offered by the dealers and the manufacturers.

Maruti Suzuki, Hyundai, Tata Motors, Mahindra, Bajaj Auto, Hero Motocorp, TVS Motor Company and Honda posted double-digit fall in volumes during July. These manufacturers say that there is a clear-cut demand issue at the retail level that needs to be addressed immediately.

But, just when everything seems down and out, some news reports appear to be far stranger than they should during a growth phase. When nearly every model is being sold at a discount, there are handfuls which are demanding a waiting period.

Hyundai’s newest addition to its India portfolio – Venue - has claimed to have received 50,000 bookings in 60 days. That is more than 800 bookings a day. The compact five-seater SUV compete with the Maruti Suzuki Brezza.

Another similar example is the Hector, a mid-size SUV from MG Motors. The Chinese-owned company has declared a stock out for the Hector for the rest of the year. Bookings have closed, and the company has expedited the production of the vehicle.

Also, in the same league, are a few motorcycles. Royal Enfield’s first twin cylinder experiment – Continental GT and Interceptor – has hit the right notes with the buyers. The niche bike-maker said that there was a waiting period of two-three months on the twins, which has forced the company to increase production to 5,000 units a month.

Closely following behind is the Jawa, the retro motorcycle brand revived by its current owner Mahindra and Mahindra (M&M). Launched in the second half of 2018, the two models – Jawa and Jawa 42 – remain out of reach for all aspirers. The closure of bookings imposed seven months ago has not been lifted by M&M yet. Bookings may reopen in October.

These models are outliers in a struggling market holding a promise that not everything is dead just yet.

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Swaraj Baggonkar
Swaraj Baggonkar
first published: Aug 3, 2019 10:55 am

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