Force Motors sells stake in JV to MAN for 150 mn euros

Mumbai: Commercial vehicles maker Force Motors Ltd has decided to sell its 50% stake in MAN Force Trucks Pvt. Ltd to its German joint venture (JV) partner and quit the heavy duty trucks segment.

Force Motors will sell nearly 56 million equity shares in MAN Force Trucks to MAN Truck and Bus AG for €150 million (Rs. 1,050.54 crore), subject to necessary approvals, it said in a statement to BSE Ltd.

The Pune-based company had initially held a 70% stake in the joint venture, formed in 2003, but later became an equal partner of MAN Trucks.
“We concluded that they should be allowed to take the full lead,” Force Motors chairman Abhay Firodia said.
Force Motors will continue to supply parts and some critical aggregates to MAN Trucks, he said.
“It’s another step in enhancing our presence in the growing Indian market. We now have a good standing here,” a MAN Truck and Bus spokesperson said on the phone from Munich, Germany.
The joint venture has not been performing optimally, Mint had reported on 15 September.
MAN Force’s plant in Pithampur, Madhya Pradesh, which makes heavy duty trucks, has been operating at half its capacity. The factory can produce 12,000 units a year but sells just 6,000 on average.
Nearly 200,000 heavy duty trucks are sold in the country annually, according to the Society of Indian Automobile Manufacturers, an industry lobby.
In April-October this year, 162,026 such trucks were sold in the domestic market, an expansion of 12% over the same period last year.
Firodia had earlier said Force Motors had converted its commercial vehicles business into the joint venture with MAN Trucks expecting large export orders, but that never happened.
The heavy duty commercial vehicles segment in India is dominated by Tata Motors Ltd and Ashok Leyland Ltd.
Companies such as Mahindra Navistar Automotive Pvt. Ltd, Volvo Eicher Commercial Vehicles Ltd and Daimler Commercial Vehicles Pvt. Ltd have also entered the market lately. The latest to join this space is the commercial vehicle maker from China, Beiqi Foton Motor Co. Ltd, which is setting up a manufacturing unit in Chakan, near Pune.
As competition intensifies, it would have been difficult for the joint venture to survive in its current form, said V.G. Ramakrishan, senior director, automotive and transportation at Frost and Sullivan.
“They (Force Motors and MAN Trucks) realized the JV was going nowhere and neither of them was able to add any value. They had to take a decision on how they want to take things forward,” he said.
Shares of Force Motors closed at Rs. 501 apiece, up 0.2% on the Bombay Stock Exchange, while the benchmark Sensex index closed at 15,946.10 points, down 2.6%.
The valuations “seem to be more rational given the company was valued at around Rs. 2,000 crore in 2008, when the JV was realigned,” said the head of mergers and acquisitions at a domestic investment bank, asking not to be identified. “Indian promoters are beginning to be more realistic with valuations and you will see many transactions going through at lower valuations in near future.”

Tata Motors​ can’t meet heavy-duty truck demand

Tata Motors Ltd, the country’s largest auto maker by sales, is finding it difficult to cope with demand for heavy-duty trucks, with buyers having to wait four-six weeks for deliveries.

Such a situation hasn’t arisen in the past few years, said vendors, dealers and fleet operators in Mumbai and Delhi. The company, however, said that the waiting period was typical for this time of year.
Fleet operators and logistics companies may start buying heavy-duty trucks from rival makers such as Ashok Leyland Ltd if the delivery period doesn’t come down.

Uncertainty looms: A file photo of Tata Motors’ Jamshedpur plant.

“We have been facing delays in delivery of trucks with large wheelbase and (are) considering buying them from other manufacturers,” said a senior official at a Delhi-based logistics firm, who declined to be identified.
Some of the heavy-duty models for which there is a waiting period are the 2515, 3118, 4118.
Trucks with a payload capacity upwards of seven tonnes are classified as medium and heavy duty.
In the nine months to December, sales of medium and heavy-duty trucks expanded 47.38% to 188,000 as the country’s economy expanded 8.9% in the first half of the year, fuelling capital goods and consumer durables demand, according to the Society of Indian Automobile Manufacturers, an industry lobby.
Transporters said the delay in delivery that they have been experiencing since December hasn’t impacted business, but the uncertainty is affecting fleet renewal and expansion plans.
“There is a continuous requirement of at least five to 10 new vehicles in the fleet per month. But we haven’t been getting them,” said Guru Pratap Singh, vice-president of the Bombay Goods Transport Association.
Singh’s firm, Calcutta Express Roadlines Pvt. Ltd, runs a fleet of 200 trucks.
Some transporters indicated that the delay may herald a price increase.
“There are no straight answers for these delays,” said a Delhi-based transporter, who declined to be named. “It’s an artificial shortage created by the company to go for another round of price hike.”
Tata Motors last raised prices of commercial vehicles by Rs. 1,500-30,000 on 1 January.
The head of a Tata truck dealership, one of the biggest in Maharashtra, said the delays began a month-and-a-half ago. He declined to be identified.
In an email response, a Tata Motors spokesperson said: “The months of February and March usually witness more demand every year. There is a marginal waiting period during these months, but that is again generic in nature.”
Tata Motors also attributed the waiting period to strong demand for new models introduced recently.
“Over the last 10 months, the company has introduced many new models with additional features and customer benefits,” he said. “Since October 2010, we have introduced the Bharat Stage III range (trucks compliant with new emission norms), wherein we have upgraded the power trains to provide higher torque and power along with better fuel efficiency. The market response has been very favourable and we are witnessing strong demand for our products.”
In response to whether the firm plans to undertake further price hikes, the spokesperson said Tata Motors doesn’t give a guidance on price hikes.
According to S.P. Singh, senior fellow and coordinator at Indian Foundation of Transport Research and Training, robust freight rates in recent months have left fleet operators with lots of cash that most of them want to use to purchase new vehicles.
Truck rentals have shot up from 26% to 39% over the last 13-14 months, he said.
Fleet expansion and upgrade plans may have been advanced by factors such as an impending rise in interest rates by non-banking financial companies and banks, Singh pointed out.
The fleet owners, he added, are also anticipating another round of price increases by the manufacturers as the government is likely to roll back the 4% reduction in excise duty, which had been cut as part of fiscal stimulus efforts in December 2008 and February 2009. The sale of such vehicles had dropped from the peak to almost one-third in the second half of 2008.
Earlier this week, at a vendor conference in Chennai, Tata Motors said it plans to produce at least 30% more trucks in February and March, and asked suppliers to ramp up accordingly, said an official from an auto parts firm who attended the meet.
The Tata Motors spokesperson did not elaborate on the plan for raising production, but said: “Higher number of units are planned during these months. So, production is as per plan.”
Ashok Leyland, the second largest truck maker by sales, is bullish about demand in the months ahead.
In a conference call with analysts on 24 January after announcing December quarter earnings, K. Sridharan, chief financial officer, said the company plans to close the year ending March with a total sale of 95,000 vehicles, up 48% from last year.
He expected overall truck and bus sales for the industry to expand more than 35%.
Manoj Mohta, head of research at rating agency Crisil Ltd, said commercial vehicle growth may get muted from April onwards as the segment is more susceptible to macroeconomic factors such as industrial production and interest rates on vehicle financing.
He, however, maintained that growth in high-tonnage trucks will continue to outpace the rest of the medium and heavy commercial vehicles even after the current quarter and is likely to expand 13-15% in fiscal 2012.

LOOSING 20% HEAVY VEHICLE SPARE PARTS SALE DROP IN ANDHRA PRADESH

Granite export slowdown from Andhra Pradesh to China .After processing the Granite in China; Chinese are export to Brazil, America, Taiwan and Myanmar. Due to international market crisis AP state Granite Industry in sleeping condition. Last 2 months, all transactions have been stopped.  This Industry is having nearly 1000 quarries in Andhra Pradesh.

The following reasons are 1) AP State Granite Industry was depending on Granite export to China. In China all leading and Important Projects works was stopped as well as House Constructions.

 Granite Sources in AP:

Chimakurthy, Ongole District: Black Galaxy

Khammam, Khammam District: Black Granite

Karimanagar, Karminagar District: Chili Red, Tan Brown, Mifil Red, Coffee Red,

Chittor, Ananathapuram District: White Granite

Srikakulam, Srikakulam District: Blue Granite

SPARE PARTS DEMAND FOR ASIA MOTOR WORKS (AMW)

 Asia MotorWorks (AMW), which has been founded in 2008, presently sells 1,000 trucks on monthly basis via 87-touch points across India. This displays robust growth for the firm and also reaffirms the surging acceptance of AMW among the truck buyers in the country.

Reports suggest that the firm had manufactured its 20,000th truck from its production plant in Bhuj, Gujarat in September this year.

The Bhuj unit has got a capacity to produce 50,000 trucks per annum and it has been established at a cost of Rs 1,500 crore. It presently employs 2,200 people and makes use of state of the art production processes for developing world class trucks for the Indian market.

The total addressable market of HCVs in 2010-11 has stood at 220,000 commercial vehicles per annum, which is presently growing at nearly 9% per annum. During this fiscal year, AMW would have forayed into all segments of the HCV market and is will grow strongly due to its surging penetration into the construction and mining segment.

Asia MotorWorks (AMW) produces commercial vehicle and components and has it strengthened its position in Indian transportation sector via innovative engineering and high customer orientation.

PROBLEMS FOR GARAGES AND DEALERS IN TAMILNADU

Chennai: Automobile vehicles and spare parts distribution company, TVS and Sons, part of the TVS Group, on Wednesday, inaugurated its 18th facility at Karur in Tamil Nadu.

Ashok Leyland​ executive director Rajive Saharia inaugurated the 3-S (Sales, Service and Spares) facility in the presence of TVS and Sons president N. Krishnamoorthy at Karur, on Wednesday, a company statement here said.

The opening of new dealerships was in line with the firm’s plans to establish facilities for every 50 km to 100 km depending on requirement of the location. This would also prove a boon to customers in not sending their vehicles for servicing to far-off locations.
More 3-S facilities would be set up in tier II and III locations, Krishnamoorthy said.
Some advantages of Karur facility include two bay servicing for vehicles, a computerized wheel alignment system, the statement added.

SHOULD BE PLAN FOR MFG. MAHINDRA SPARE PARTS

Commercial segment which includes passenger and load catagaries, had a phenomenal growth of 67%

2011 MOVEMENT UNIVERSAL JOINT CROSS (TRUCK, BUS) IN INDIA MARKET

DESCRIPTION APPLICATION O.E PART NO DIA

1 WITH 90 GREASE NIPPILE TATA 1210 DI/SE,1109,A.L STAR BUS, 407 New 012 410 0031J (38.05mm x 104.50mm)
407 LATEST, FRONT

2 WITH 60 GREASE NIPPILE TA T1312,1612,1616,2515EX 257 641 110141 (46.06mm x 120.00mm)
Modified FLAT G.N TATA 1312,1612,1616,2515EX 257 641 110141 (46.06mm x 120.00mm)

3 WITH 2CIRCLIPS, 2 STRAPS TATA SUMO, SAFARI, SIERRA, 207DI, MOBILE 2698 4110 0101 (27.00mm x 81.60mm)

4 TATA 407 2651 4110 0105/0110 (30.06mm x 81.60mm)

5 XLO TYPE A.L COMET P1500151 (39.68mm x 115.60mm)

6 WITH OUTER CIRCLIPS A.L TAURUS/ EICHER JUMBO GALAXY(30.25) P38 002 51(KEMPH) (47.65 mm x 135.00mm)

7 MSL TYPE A.L TUSKER, A.L HINO,1612,2214, P40 003 39 (34.91mm x 126.10mm)

MSL TYPE( G.N) TATA 1612,909 EX(Spicer) BS-III(Spicer), P40 003 39 (34.91mm x 126.10mm)
EICHER (30.25), CANTER,MAZDA,709TURBO EX

TATA 2515TC (EX) REAR 2518(EX) HYWA 2171 4100 0107

9 XLO TYPE A.L CARGO 709, 909 P45 001 51 (30.19mm x 106.15mm)
TATA LPT SFC 909, 709 TURBO EX, 407 EX, 2641 41111 5102
EICHER, CANTER,MAZDA
MAHINDRA NAVISTAR (SOME MODELS)

10 WITH ONE GREASE NIPPLE, 4CIRCLIPS, STRAPS TATA 1510, 1612, 1613 (SPICER) 2632 4111 0133 (34.91mm x 126.10mm)

11 OUTER LOCK ALWYN NISSAN, 407 LATEST (30.19mm x 91.90mm)

12 ACE TRUCK/MAGIC TATA ACE/MAGIC (2 types) - SPICER 2829 4110 0109 (23.84mm x 35.20mm)

13 SPICER TYPE A.L 4018 8854 4101 4018 (49.20mm x 154.90mm)
TATA 4018 P4501251
AMW, MAN FORCE

14 RSB TYPE(Inner Lock) TATA 2515CEX/ 1613 EURO II/1613 TIPPER 280941100110 / 263241100 117 (42.04mm x 119.70mm)

15 RSB TYPE(Outer Lock) TATA 2518,3518 HYVA, 2171 4112 0127 (42.04mm x 129.50mm)

16 RSB TYPE (48.03 O.L) TATA 2518,3518 HYVA, 4018 (Latest) (48.03mm x 134.50mm)

BEAWARE FOR UNDER CHASIS SPARE PARTS MFG.{TOWARDS TACKLING OVERLOADING ON ROADS}

Road transport is vital to economic development,

trade and social integration, which include the

conveyance of both people and goods. Easy

accessibility, flexibility of operations, door-to-door

service and reliability have earned road transport

an increasingly higher share of both passenger

and freight traffic vis-à-vis other transport modes.

Roads carry 61% of freight traffic and 87% of

passenger traffic. National Highways, which are

the major arteries of the road network, carry 40%

of road traffic. The unanticipated growth in volume

of goods vehicles coupled with heavy loads is,

however, responsible for premature deterioration

of the roads in the country.

Studies in developed countries have established

that for every increase in axle load beyond the

permissible limit, the extent of damage caused to

the condition of pavement increases exponentially

by power four, which is a significant impact. It has

been assessed that overloaded freight vehicles are

responsible for approximately 60% more damage

to the road surface, as opposed to legally loaded

vehicles. As per the current practice, flexible

pavement is designed for a service life of 10 to

15 years, rigid pavement for 25 to 30 years and

bridges for a life of 50 years. Research carried

out in South Africa has shown that 10 per centOverloading, therefore, reduces the

overloading of goods in excess of prescribed

loads reduces the life of pavement by about

35 percent.

service life of pavement causing signs of early

distress. Unbalanced loading in trucks is also

considered to be harmful to the pavement. As pertruck manufacturer’s technical specifications, loads

in trucks should be distributed in the ratio of 1 to 2

on front and rear axles respectively.

Overloaded vehicles threaten road safety and

contribute to many fatal accidents on our roads.

Literature survey has revealed that overloading of

vehicles poses the following risks:The overloaded vehicle becomes less stable,

difficult to steer and will take longer to stop.Overloaded vehicles cause the tyres to overheat

and wear rapidly which increases the chance

of premature failure or blow-outs.The driver’s control on the overloaded vehicle

is diminished, enhancing the chances for an

accident.The overloaded vehicle cannot accelerate as

normal, making it difficult to manoeuvre.Brakes have to work harder because the

vehicle becomes heavier. Brakes overheat and

lose their effectiveness to stop the vehicle.The whole suspension system comes under

stress and with time, the weakest and most

stressed point can give way.

In short, the overloaded vehicle is a serious concern

for safety and the life of the vehicle is also reduced

considerably.

Since the percentage of goods transported by roads

is increasing, it is expected that heavy vehicles

would remain a common sight on our roads, in

future. However, in the interest of the roads as well

EDITORIAL

(R.P. Indoria)

Secretary General

as the vehicles, overloading should not be allowed

to continue unchecked, for long. Law enforcement

agencies need to take stringent action against the

operators of overloaded vehicles. Compliance

could be achieved through a combination of

enforcement and prevention. Instead of the

current focus on enforcement alone, there should

be a focus on use of technology in solving the

underlying problem of overloading. There is a

need for enforcement of loading at source itself

or setting up of Weigh-in–Motion stations along

the highways. The data so gathered could be used

to generate statistical overviews on the loading

situation on a specific road. Such overviews could

be used by road administration authorities for

road design and road maintenance. Enforcement

agencies could use this overview in the planning

of enforcement activities, when and where control

stations are to be deployed. If we are able to

enforce legal limits on axle loads, we may hope

to ride on better and safer roads. Simultaneously,

modernization of vehicle fleet is also to be carried

out, to transport higher loads without exceeding

the permissible axle loads. This would help in

improving the management of roads within the

available resources.

Damage to roads, as a result of overloading,

leads to higher maintenance and repair costs

and shortens the life of a road.

the road pavement, with the resultant increase in

roughness, lead to increased vehicle operating

costs, discomfort, decreased riding quality and

reduced safety conditions. This, in turn, puts

additional burden on the governments as well as

the road users, who ultimately have to bear the

costs of careless and inconsiderate overloading.

As per available reports, efforts have been made

in China to curb overloading through a nationwide

conducting education programmes, standardizing

vehicle manufacturing and refitting, labelling

vehicle tonnage, reducing toll fees etc.

Overloading of vehicles has been engaging the

attention of highway engineers and administrators

for quite some time. In a significant judgement

delivered by the Supreme Court, the practice

of issuing gold cards/tokens by some State

Governments, which allowed the card holders

charges, has been banned. In this judgement, the

Supreme Court has desired State Governments

transporter the cost of the operations. In addition,

the State Governments have also been ordered to

levy a penalty on the extra tonnage. As per the

available newspaper reports, while the benefits of

the SC ruling seem to be manifold, there have been

practical hurdles in its uniform implementation

by all the States. All said and done, the long-term

benefits of ending the system of government

overloading could materialize only if

the SC order is implemented strictly.

While damage to the roads by heavy overloaded

vehicles cannot be eliminated, it is imperative in

the interest of road users and the road transport

agencies that all reasonable steps should be taken

to minimize the deterioration of our roads. For

this, it is essential that government agencies

and the transport industry work together since

overloading is unwanted.approved

to offload the overloaded cargo and charge the

to overload their trucks after payment of fixed

Deformation of

campaign by strict enforcement of traffic laws,

HIGHWAYS, 3, april 2011

Back State Editions Dehradun Dumper association demands immediate ban on overloading Dumper association demands immediate ban on overloading .

Members of the dumper association, associated with collection of riverbed materials, here on Wednesday gheraoed the divisional forest officer, the terai east forest division, demanding immediate ban on overloading of riverbed materials.
The agitated transporters alleged that the concerned enforcement agencies in connivance with the stone- crushers are allowing the overloading which is completely banned in the State and elsewhere in the country as per the Supreme Court guidelines. But the members of the dumper association alleged that despite their repeated requests, the concerned authorities seemed to be quite ignorant about this issue.
Accusing the enforcement agencies of ignoring overloading in connivance of the stone-crushers, Manoj Mathpal, president of the dumper association, informed The Pioneer, that as per the guidelines of the apex court a load of only nine tonne is allowed at a time. But, Mathpal, alleged, that certain transporters there are carrying load over 14 tonnes. And more importantly, the enforcement agencies seem to be quite ignorant about this act.
The matter of fact is that, this is an open violation of the direction of the apex court. But here the people associated with collection of riverbed materials are violating these norms fearlessly. We during our talks with DFO, Terai-East forest  division, P K Patro, took up the issue  and urged him to take necessary action to do away with the menace of overloading, further informed Mathpal.
He alleged, the DFO did not give any concrete assurances. The DFO only said that he would take up the matter with the district magistrate.
The response that we got from the DFO was very disappointing. The fact is that the stone -crushers are continuously pressurising the transporters for overloading, he alleged.
There are over 4000 vehicles presently deployed for lifting riverbed materials only from the local river Gola. And the Government has granted permission for collection of riverbed materials till May 2012. So if the overloading continues in such a rampant manner for the next five or six months, one can imagine the huge financial losses that the State Government is going to suffer in terms of royalty from this collection of riverbed material business, stated the agitated dumper association members.
More so, overloaded vehicles cause maximum accidents on roads and cause damage to the public properties, added the agitators. But it seems the concerned authorities are little worried about these issues, they maintained.

Source: Pioneer

DEMAND INCREASED FOR TIPPER SPARE PARTS

Tata Motors Ltd and Ashok Leyland Ltd reported strong truck and bus sales in October,2011 because of an increase in construction activity that boosted demand for tipper

Overall sales have been led by tippers, following a pick-up in construction activity, even as the industry has seen a slower off take by the cargo segment.

“The tippers have grown much faster given non-availability of such vehicles last year resulting in pent-up demand, a good replacement demand and healthy road construction activity.

Sources: Mint