Automobile manufacturers now feel a pinch of recession.
>> Friday, November 7, 2008
Most of the Automobile manufacturers are now in a puzzle. Let it be India or let it be the whole world.
Recession is the only thing affecting the auto sales , due to feel of recession people have cut their expenses on luxury items or more expensive items.
In two wheeler segment Both Bajaj Moters and TVS showed negative sales , while Hero Honda showed a positive sales figure.
In four wheeler segment all of the scrips have tumbled. Sales have reduced.
Sales on Diwali day were marginally lower compared to last year.
(Last year 17,000 units in one day this year 15,000 units in a day)
Ashok Leyland has already felt the pinch as it has reduced the days of production.
Today Ford Motor Co posted a $2.98 billion quarterly operating loss and shares in world No. 1 automaker Toyota Motor Corp plunged on Friday after it warned this year's profits would hit a 13-year low.
So is it all the Recession Effect ?
2 comments:
Auto is a cyclical industry. In boom times we see lot of purchases and it goes dull in other times. Just because indian auto industry is seeing some downside numbers doesn't mean auto sector is all gone. No. Last 5 years we have witnessed a major boom in RE, Real estate, Stock markets, Jobs, salaries, borrowing power and so on. This triggered the numbers of auto makers to go haywire. Now that all of the above has calmed down, so has the numbers of these companies. They have come to more realistic levels. Some may think they are going down. But if you carefully look, they are still much higher when compared to what they were in 2000 or thereabouts (relatively).
Parsoon Gopal on Stocks Buddy.
If you look at Maruti, they had a pretty decent sales month in October. I think the current auto-selloff is over-rated. If we can see lending rates come down to around 10% in the next 3 months, we will see auto sales picking up.
Tushar
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