Go Back   Team-BHP > BHP India > The Indian Car Scene


Reply
 
Thread Tools Search this Thread
Old 18th December 2008, 09:30   #1
BHPian
 
prateekswarup's Avatar
 
Join Date: Jul 2008
Location: Delhi NCR
Posts: 233
Thanked: 109 Times
Default The future of GM, Ford & FIAT in India...

I am a little confused and I'm hoping someone here can enlighten me.
The bailout for the big three is not materializing.

What is going to be the future of the vehicles that belong to the big three in India?

I mean, will Ford and GM shut down in India concerning the situation of their parent company?

Or are the Indian offices of GM and Ford safe from the bankruptcy that is eventually going to hit their parent companies?

Also, FIAT is shutting down its 6 factories in Italy for a month due to lack of sales in the European market. Is FIAT also on the verge of shutting down?

Link for FIAT news:
UPDATE 1-Fiat extends temporary plant closure programme | Industries | Consumer Goods & Retail | Reuters

@Mods: If this it at the wrong section please feel free to remove/move this thread. Thanks
prateekswarup is offline   Reply With Quote
Old 18th December 2008, 09:56   #2
Senior - BHPian
 
finneyp's Avatar
 
Join Date: Dec 2005
Location: Bangalore
Posts: 2,619
Thanked: 160 Times
Default

Fiat has temperorily halted production in some of its factories in Italy coz of low sales in Europe, that in no way means Fiat is shutting down!
finneyp is offline   Reply With Quote
Old 18th December 2008, 10:31   #3
Senior - BHPian
 
Join Date: Feb 2004
Location: Mumbai
Posts: 3,717
Thanked: 425 Times
Default

The slowdown has hit all car makers globally so it's not just about the three makers listed down here.

- Suzuki and Suburu have pulled out of WRC. Honda pulled out off F1.

- Honda has slashed it's profit forecast by 67% and has announced 10% paycuts for it's managerial and directorial staff. It has also delayed declaring dividends.

- Honda North America is slashing production by 1,19,000 units.

- Honda has put on hold it's global expansion plans including the Indian one.

- Honda Car India is stopping production for the rest of December due to piling up inventories.

- Nissan Japan is cutting production by 78,000 units and laying off about 450 workers. This is going to lead to the company stopping production at it's Japanese factories temporarily.

- Toyota is expected to come out with it's own set of grim news.

- Suzuki is also cutting production, laying of temporary workers and planning to temporarily shut it's factories due to piling up inventories.

Point is that the grim news is not just restricted to a few car makers. As the Fiat CEO has said, this phase means cartain carmakers will have to get together to tide over the crisis or risk permanant closure of their business.

I think Chrysler will be the first car-maker to fall to this crisis.

Have any of you read Toyota's announcement that if the Big-3 fall, it will lead to chaos at Toyota plants too as they share a lot of vendors with the Big-3 and a lot of vendors are going to go bankcrupt if the big 3 fall.
amit is offline   Reply With Quote
Old 18th December 2008, 10:47   #4
Senior - BHPian
 
snaronikar's Avatar
 
Join Date: Jun 2007
Location: Bengaluru
Posts: 2,845
Thanked: 23 Times
Default

IMO, the indian arm may slow down operations but will definately they will not shut down the plants. India is a growing economy and we are less affected compared to other developed countries in the world. Shutting down operations be it in India or in BRIC countries will mean more disaster to these companies.
snaronikar is offline   Reply With Quote
Old 18th December 2008, 11:21   #5
Distinguished - BHPian
 
phamilyman's Avatar
 
Join Date: Jul 2007
Location: Gurgaon
Posts: 5,601
Thanked: 3,452 Times
Default

Amit has nailed it. thread title needs to be changed
phamilyman is offline   Reply With Quote
Old 18th December 2008, 13:16   #6
BHPian
 
Sowmya's Avatar
 
Join Date: May 2007
Location: Bangalore
Posts: 494
Thanked: 16 Times
Default

@Amit You have forget to mention our Home Company.
- Tata temporarily shut down their factory for few days. Jamshedpur/Pune plant is shut down weekly 2/3 days. But the irony is that TATA is taking part in F1.

FIAT will not shut down until TATA and Maruthi are there. Where will TATA and Maruthi will go for engine ?
Sowmya is offline   Reply With Quote
Old 18th December 2008, 13:28   #7
Senior - BHPian
 
aseem's Avatar
 
Join Date: Jul 2005
Location: Delhi
Posts: 1,737
Thanked: 416 Times
Default

The fact of the matter is that these companies wont go bankrupt as the 700 billion dollar financial bailout funds will now be used to rescue GM in the short term. Fords outlooks is relatively good and it doesnt need money to survive in 09.
If however 1% these companies do file for chapter 11, in that case you can kiss goodbye to GM india.
aseem is offline   Reply With Quote
Old 18th December 2008, 13:28   #8
JVH
Senior - BHPian
 
JVH's Avatar
 
Join Date: Aug 2008
Location: Bangalore
Posts: 1,021
Thanked: 148 Times
Default

Quote:
Originally Posted by amit View Post
The slowdown has hit all car makers globally so it's not just about the three makers listed down here.

- Suzuki and Suburu have pulled out of WRC. Honda pulled out off F1.

- Honda has slashed it's profit forecast by 67% and has announced 10% paycuts for it's managerial and directorial staff. It has also delayed declaring dividends.

- Honda North America is slashing production by 1,19,000 units.

- Honda has put on hold it's global expansion plans including the Indian one.

- Honda Car India is stopping production for the rest of December due to piling up inventories.

- Nissan Japan is cutting production by 78,000 units and laying off about 450 workers. This is going to lead to the company stopping production at it's Japanese factories temporarily.

- Toyota is expected to come out with it's own set of grim news.

- Suzuki is also cutting production, laying of temporary workers and planning to temporarily shut it's factories due to piling up inventories.

Point is that the grim news is not just restricted to a few car makers. As the Fiat CEO has said, this phase means cartain carmakers will have to get together to tide over the crisis or risk permanant closure of their business.

I think Chrysler will be the first car-maker to fall to this crisis.

Have any of you read Toyota's announcement that if the Big-3 fall, it will lead to chaos at Toyota plants too as they share a lot of vendors with the Big-3 and a lot of vendors are going to go bankcrupt if the big 3 fall.
Spot on! This applies not only to the Auto industry but also other industries as well where global players have offices/plants around the world.

On The Toyota vendor thing, there is an interesting discussion going on in linkedin. Many are even thinking about the possibility of how Indians (read Tata) make the best out of the situation
JVH is offline   Reply With Quote
Old 18th December 2008, 13:41   #9
BHPian
 
prateekswarup's Avatar
 
Join Date: Jul 2008
Location: Delhi NCR
Posts: 233
Thanked: 109 Times
Default

Quote:
Originally Posted by amit View Post
The slowdown has hit all car makers globally so it's not just about the three makers listed down here.

- Suzuki and Suburu have pulled out of WRC. Honda pulled out off F1.

- Honda has slashed it's profit forecast by 67% and has announced 10% paycuts for it's managerial and directorial staff. It has also delayed declaring dividends.

- Honda North America is slashing production by 1,19,000 units.

- Honda has put on hold it's global expansion plans including the Indian one.

- Honda Car India is stopping production for the rest of December due to piling up inventories.

- Nissan Japan is cutting production by 78,000 units and laying off about 450 workers. This is going to lead to the company stopping production at it's Japanese factories temporarily.

- Toyota is expected to come out with it's own set of grim news.

- Suzuki is also cutting production, laying of temporary workers and planning to temporarily shut it's factories due to piling up inventories.

Point is that the grim news is not just restricted to a few car makers. As the Fiat CEO has said, this phase means cartain carmakers will have to get together to tide over the crisis or risk permanant closure of their business.

I think Chrysler will be the first car-maker to fall to this crisis.

Have any of you read Toyota's announcement that if the Big-3 fall, it will lead to chaos at Toyota plants too as they share a lot of vendors with the Big-3 and a lot of vendors are going to go bankcrupt if the big 3 fall.
I know about the production woes of Honda, the WRC scenario and even the Toyota announcement. Although the above information clarifies that the automakers are facing a severe crisis and are doing everything plausible to rectify the situation, I am under the impression that the big -3 will be the most hit.

If this is the case, where does it leave the people who are going to buy Ford/GM vehicles in India? Do we assume that a lot of models may be shelved to streamline the costs or will the Indian customer enjoy the same reliability in terms of parts and after-sales of the cars produced by the Big 3 in India?

Basically would it be alright to buy a Ford/Gm vehicle right now?

What happens to their Indian operations if the parent company files for bankruptcy?
prateekswarup is offline   Reply With Quote
Old 18th December 2008, 13:50   #10
BHPian
 
Join Date: Jul 2008
Location: Bangalore
Posts: 175
Thanked: 2 Times
Default

Quote:
Originally Posted by JVH View Post
Spot on! This applies not only to the Auto industry but also other industries as well where global players have offices/plants around the world.

On The Toyota vendor thing, there is an interesting discussion going on in linkedin. Many are even thinking about the possibility of how Indians (read Tata) make the best out of the situation
Can you show me the link on linkedin? Thanks

Nitin
crn12 is offline   Reply With Quote
Old 18th December 2008, 13:57   #11
Newbie
 
Join Date: Aug 2008
Location: hyderabad
Posts: 16
Thanked: 0 Times
Default

None of the big three would face a situation of a complete shut down around the world.
The only possibility is cutting down on their size in loss making / economically unviable markets.
After all these companies have all the technology they need in the world to create products of good quality that can compete in any international or domestic market.
Maximum hit that these companies will take would probably be a reduction of 40% in terms of overall size, which would trim their revenues and expenses equally.

The only reason for any company to completely withdraw from any market would be is if their products are not competitive enough in the market. The big-3 will surely remain in the global markets but might not continue to hold the top spots.
varun83 is offline   Reply With Quote
Old 18th December 2008, 14:11   #12
JVH
Senior - BHPian
 
JVH's Avatar
 
Join Date: Aug 2008
Location: Bangalore
Posts: 1,021
Thanked: 148 Times
Default

Quote:
Originally Posted by crn12 View Post
Can you show me the link on linkedin? Thanks

Nitin
Nitin,

You've got to be a member of linkedin and a group member of India Leadership network to access this. If you do have the relevant memberships, here is the link

LinkedIn: Sign In

@prateekswarup - we can discuss and speculate on a lot of things on your questions but don't you think only time is the answer to how would this turn out to be?

If I were a prospective car buyer, I would not consider them atleast for the next 6 months
JVH is offline   Reply With Quote
Old 18th December 2008, 14:23   #13
ACM
Distinguished - BHPian
 
ACM's Avatar
 
Join Date: Mar 2008
Location: Mumbai
Posts: 4,152
Thanked: 2,457 Times
Default All equals

I guess its mostly all equals. It is as safe or unsafe to buy any perticular brand currently among the names mentioned.

My perception:

Tata in India is also leveraged poorly after the Jal Land Rover Deal, and Suzuki (Maruti) is obviously a smaller player than Honda and Toyota who too are hit.

The government in USA if as likely to do something for GM / Ford in the USA as they are for say the Indian Govt. Tata or to some extent Maruti in India. (If required that is)

Amercian cos; Ford seems safer than GM which seems safer than Crystler
Jap cos: JToyota seems safer than Honda which seems safer than Suzuki which seems safer than Mitshubishi.
Korean cos: Hyundai seems much better off than Kia.
German cos: Were never into big numbers except the VW.

VW Group and Fiat both seem to be better bets than the American set but worse off than the Toyota from the Japs.

Each nation will do its bit for a it's own companies and these may each differ investment into foreign plants but that would/ should not mean closure of sales and service networks.

One major company going down even for a short while would affect sentiment globally, but then there is be more business that the rest can share amongst themselves.

I guess it is the same in all industries.

As mentioned earlier that's my perception, but have been know to be wrong.
ACM is offline   Reply With Quote
Old 18th December 2008, 16:39   #14
Senior - BHPian
 
aaggoswami's Avatar
 
Join Date: May 2007
Location: Vadodara
Posts: 4,675
Thanked: 1,427 Times
Default

The fact is that Suzuki, Subaru ( now part of Toyota ), Honda are having good amount of cash on hand. Compare this with GM, Fiat, Chrysler. They are not having sufficient cash. That's why Fiat is planning a merger. Mostly Fiat and PSA are going to merge. So there are chances of Fiat managing to stay alive, so in India also, they will survive. But the same cannot be said about GM. If GM files for bankruptcy, then the Indian operations are bound to get hit. In one way or other.

Ford is in good condition, but if the GM and Chrysler fall down, the entire supplier chain is going to get hit and in turn Toyota, Honda will also get hit. Suzuki is basically dependent on its home operations, India and Europe, so no problem here.

GM is what I see as the one to fall after Chrysler and so GM India's future is cannot be said as very bright in India. Fiat will survive.
aaggoswami is offline   Reply With Quote
Old 19th December 2008, 10:46   #15
BHPian
 
rudrah's Avatar
 
Join Date: Dec 2007
Location: Navi Mumbai
Posts: 606
Thanked: 20 Times
Default

Yesterdays reports at CNN:

1. Chrysler going to shut down all operations all over US for a month
2. General Motors announced it was idling 30% of its North American manufacturing capacity during the first quarter of 2009
3. Ford confirmed that the automaker is adding a week to its normal two-week seasonal shutdown at a number of its plants.
rudrah is offline   Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
6 month old Ford Figo DCT: Battery dead 7 times! An ordeal with Bhagat Ford & Ford India Night Raven Technical Stuff 27 20th September 2016 16:25
FIAT Future: Multijet-2, SuperFIRE, DDCT & Multiair sushanthr77 The International Automotive Scene 25 1st January 2013 21:15
Why Fiat Has Failed In The Past, Present & Will Continue To Fail In The Future smartcat The Indian Car Scene 60 29th February 2012 14:03
Ford India's future line up chennai-indian The Indian Car Scene 276 5th January 2012 09:54


All times are GMT +5.5. The time now is 05:31.

Copyright ©2000 - 2017, Team-BHP.com
Proudly powered by E2E Networks