Auto dealers unsure of a revival in consumer sentiment in festive season

Current Affairs

India’s real or inflation-adjusted gross domestic product (GDP) grew at 5 per cent in the June 2019 quarter of financial year 2019-20 (Q1FY20), the slowest growth in six years (25 quarters). In nominal terms, the growth stood at 7.99 per cent, lowest since December 2002.
With this, fears of the slowdown being a more structural one than a cyclical one have surfaced.
What is a cyclical slowdown?
A cyclical slowdown is a period of lean economic activity that occurs at regular intervals. Such slowdowns last over the short-to-medium term, and are based on the changes in the business cycle.
Generally, interim fiscal and monetary measures, temporary recapitalisation of credit markets, and need-based regulatory changes are required to revive the economy.
What is a structural slowdown?
A structural slowdown, on the other hand, is a more deep-rooted phenomenon that occurs due to a one-off shift from an existing paradigm. The changes, which last over a long-term, are driven by disruptive technologies, changing demographics, and/or change in consumer behaviour.
Dissecting India’s slowdown

 A slowdown in consumption demand, decline in manufacturing, inability of the Insolvency and Bankruptcy Code (IBC) to resolve cases in a time-bound manner, and rising global trade tension...Read More

Anil Ambani's Reliance Naval risks insolvency as banks say no to debt plan

Current Affairs

There is no change in Pakistan's nuclear policy, the Foreign Office has said, hours after Prime Minister Imran Khan vowed that his country will never ever start a war with India, amid escalating tensions between the nuclear powers over the Kashmir issue.
Addressing a gathering of the Sikh community at the Governor's House in Lahore on Monday evening, Khan said both India and Pakistan are nuclear-armed countries and if tension escalates, the world will face danger.
"There will be no first from our side ever," he said, without explaining further.
However, Khan has been repeatedly threatening the possibility of a nuclear war with India over Kashmir after his efforts to internationalise the matter failed to gain any traction.
Khan also said conflict create more problems than resolving them.
"I want to tell India that war is not a solution to any problem. The winner in war is also a loser. War gives birth to host of other issues," he said.
However, Pakistan Foreign Office said Khan's comments were being taken out of context and did not represent a change in Islamabad's nuclear policy.
"Prime Minister's comments on Pakistan's approach towards conflict between two nuclear armed states are being taken out of context," Foreign Office spokesperson Mohammad Faisal said in a late night tweet on Monday.

 "While conflict should not take place between two nuclear states, there's no change in Pakistan's nuclear policy," he said...Read More

BMW to recall 360,000 cars in China over Takata airbags

Company News

Germany's BMW will recall 360,000 vehicles in China as part of the worldwide effort to root out defective airbags made by now-defunct Japanese supplier Takata, regulators in Beijing said.

Around 20 people have died in accidents linked to defects in Takata airbags since 2013, prompting a massive worldwide recall of at least 100 million cars from a wide range of manufacturers.
The recall will affect nearly 273,000 models built by BMW's joint venture with Chinese manufacturer Brilliance Automotive and more than 87,000 imported BMW cars, China's State Administration for Market Regulation said.

The agency said in statement posted on its website late Tuesday that a defect could cause the airbags to eject debris at passengers if deployed.

It did not mention any specific incidents caused by the BMW-installed airbags.

The China recall affects more than two dozen different BMW models built between 2000 and 2018, including several each in the i, X and M series, along with other models.

The suspect parts will be replaced for free, the notice said.Founded in 1933, Takata went out of business in 2017 because of the airbag crisis.The BMW announcement came as global carmakers were gathered for the Shanghai Auto Show amid a rare sales slump in the world's largest vehicle market.


 (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Mahindra to increase price of vehicles by up to Rs 73,000 from April

Company News

Auto major Mahindra & Mahindra (M&M) Thursday said it will increase the price of its passenger and commercial vehicles by Rs 5,000 to Rs 73,000 from April to partially offset the impact of rising input costs.

The price of the company's vehicles will go up by 0.5 per cent to 2.7 per cent from next month due to the price hike, the company said in a statement.

"This year has seen record high commodity price increases. Further there are regulatory requirements effective April 1 that have also led to cost increases.

While we have made efforts to reduce our costs, it has not been possible to hold back the price increase," M&M President Automotive Sector Rajan Wadhera said in the statement.
Consequently, the company is taking a price increase from April 1, he added.

The company sells various utility vehicles ranging from newly launched compact SUV XUV300 to premium SUV Alturas G4. M&M also sells various commercial vehicles including Supro and Jeeto in the domestic market.

Earlier this week, French car maker Renault had announced increase in price of Kwid range in India by up to 3 per cent from April.

Last week, Tata Motors had also announced increase in price of its passenger vehicles by up to Rs 25,000 from April on account of rising input costs and external economic conditions.

 M&M joins the likes of Toyota and Jaguar Land Rover which have also stated that they would raise price of select models from April.