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2020-10-28

Hyundai Plant in St Petersburg To Reduce Production by 15%

Hyundai plans to reduce annual production by 15% at its St Petersburg plant, according to plant director A. Kossack. As he notes, production volume at the plant has dropped significantly this year: in H1 2020, the plant produced only 73,000 cars, 25% of its production capacity.

Taking into consideration September’s output of 24,000 cars, total production volume through the end of the year should reach about 200,000 vehicles, almost 15% below the 2019 results. The plant has just returned to a three-shift working schedule. During the post-quarantine period, the plant working on a two-shift basis, making 700 cars per day. 

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PSR Analysis: It appears that the most pessimistic forecasts for the passenger car market to drop 40-50% are not going to be realized. Despite this outlook, Hyundai remains positive about the Russian market, and plans to start engine production here in 2021.    PSR

Maxim Sakov is Market Consultant, Russia, for Power Systems Research

2020-11-24

Russia To Start Making Diesel Engines for Passenger Cars

Maxim Sakov
Maxim Sakov

Today, there is no mass production of diesel engines for passenger cars in Russia. Production of the last such project, the turbodiesel ZMZ-514 for UAZ SUV, was halted several years ago.

But next year Russia will resume mass production of diesel engines for passenger cars. The PSMA Rus plant in Kaluga will make 1.6-liter diesels of the DV6 family, designed by French PSA. The production start is planned for mid-2021.

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Columbia Auto Market Maintains Growth Curve

The Colombian auto market has retained its growth curve in October by posting sales of 20,900 units, up 13.3% compared to September, a month which also grew 39% above August. Data source:   Andemos

The Andemos said this recovery is due to the increase of procurement for “safe transportation” as well as reopening of the economy and ending of personal isolation.

According to Andemos, if no new measures requiring isolation are taken, then the reduction compared to 2019 will be around 30%

Source: Autodata     Read The Article

PSR Analysis: As we stated in our Q3 2020 update forecast, Colombia is one of the countries most severely affected by COVID-19. It is very good to know that Colombia is restarting its growth cycle. PSR

Fabio Ferraresi is Director-Business Development-South America, for Power Systems Research

2020-12-21

Daimler India Adopts Aggressive Dealer Strategy

Daimler India, which recently set up 10 new touchpoints, plans to have at least 350 dealerships across India in the next two years as it looks to deepen market penetration.

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In September, DICV announced plans to grow its BharatBenz dealer network by 10%, exceeding 250 outlets by the end of 2020. With the opening of these new touchpoints, the company moves a step closer to cutting the distance between dealerships from 160 km to 120 km. The company is expanding strategically. The touchpoints are located on leading national and state highways, improving DICV’s golden quadrilateral coverage.

Along with increasing domestic reach, the company is focusing on the export market. Post announcement of the production-linked incentive (PLI) scheme, the company plans to invest in the country. The new investment could be used to increase the localization levels of components to avail the PLI. Furthermore, India has moved to BS-VI norms (equivalent euro 6 norms), it will be relatively easier for the company to cater to domestic as well as an export market with the same engines (with few moderations).   PSR

Aditya Kondejkar is Research Analyst – South Asia Operations – for Power Systems Research

Increased Utilization Fees for Vehicles Planned

Russian authorities plan to increase vehicle utilization fees in 2021, according to automotive sources.

Utilization fees could be increased by as much as 25-30% for all types of vehicles, including special machinery, according to industry sources. This measure would be accompanied by a comparable devaluation of the national currency, which would reduce trade barriers.

Utilization fees were implemented in 2012. It was always considered as a compensation of Custom’s tax reduce after Russia’s entry into WTO. It was set in Russian Rubles. Initially, the fees were paid by the importers only. However, they later were expanded to everybody, but then local OEMs started receiving industrial subsidies, compensating for this fee.

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PSR Analysis: With reduced tax collection and increased State expenses in 2020, Russian authorities are seeking sources to compensate for income losses. Increasing utilization fees is one way to do this.    PSR

Maxim Sakov is Market Consultant – Russia Operations for Power Systems Research

2021-09-26

Mercedes Announces BEV Bus for Brazil

Fabio Ferraresi
Fabio Ferraresi

Mercedes says it has committed an investment of US$ 20 million for the launch of the eO500U, the first electric bus by the German OEM, the market leader in Brazil. Roberto Leoncini, Sales Director said that Mercedes opted for beginning the electrification of the MHV segment by the Bus products because it has higher impact on the population.

One of the key drivers for this launch is the new legislation for São Paulo city that aims to convert 50% of the fleet to electric by 2027. This means 7,000 electric buses will be sold by 2027. Sales forecast starts with 50 to 150 units by 2022.

Source: Automotive Business     Read The Article

PSR Analysis: With new legislation, OEMs rush for e-bus chassis launch to keep market share. Meanwhile, BYD celebrates the opportunity to grow with the lack of competitors, but it needs an improved in business model and strategic aspects to grow. PSR

Fabio Ferraresi is Director-Business Development, South America, for Power Systems Research

2021-10-23

KAMAZ Increases Nine-Month Production 21%

KAMAZ has significantly increased production for the first nine months of 2021 versus the same period last year. Through September, the OEM produced 30,979 vehicles, up  21% from the same period in 2020, reports the company.

In September, KAMAZ made 4,067 vehicles (versus 3,676 vehicles in September 2020.

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PSR Analysis: KAMAZ has found ways to resolve the problem with components (mostly by offering simpler models), working with pent-up demand and increasing its market share.

Maxim Sakov is Market Consultant – Russia Operations, for Power Systems Research

2021-12-19

JCB To Expand Production Capacity in Brazil

JCB plans to invest R$ 120 million (US$ 20 million) in its factory located in Sorocaba, State of São Paulo, with the objective of increasing annual production capacity from 4,000 to 10,000 units by 2026. JCB expects to grow 50% in sales volume this year, compared to last year’s results, and more than double the sales.

Source: Valor Economico      Read The Article

PSR Analysis: With the increased production volume from new products made in Brazil, such as Wheel Loaders, JCB should be above 80% capacity. With the market growth forecast for Brazil, it will be necessary for JCB to increase production capacity. The scenario is slightly different for other players who have higher capacity in their plants in Brazil. PSR

Fabio Ferraresi is Director, Business Development South America, for Power Systems Research

2022-01-22

2021 Trailer Industry Grows 33% at 163,000 Units

The Brazil trailer industry registered 163,000 new license plates in 2021 vs. 122,000 in 2020, growing 33.5%. The result could have been even better since the segment was affected by a lack of components, such as steel, tires, etc. Export sales climbed to 4,600 units vs. 2,100 units in 2021.

Source: M&T / Anfir     Read The Article

PSR Analysis: The growth is in line with truck sales that confirm the health of the transportation industry. The growth of exports confirms the recovery of key markets of Trailers and MHV.

Fabio Ferraresi is Director Business Development-South America for Power Systems Research

2022-03-20

Brazil Cuts Taxes on Production of Several Segments

BRAZIL/SOUTH AMERICA REPORT

Taxes on Industrialized Products (IPI) will be reduced by 25% for most of industrialized goods, in a Governmental effort to boost Industry production. The total impact in federal revenue will be US$ 5 billion in 2022.

Source: M&T     Read The Article

PSR Analysis: This should affect positively sales and profitability in all engine powered segments. However, profitability should be more impacted than volume. Construction Equipment should have the higher impact as well as spare parts.   PSR

Fabio Ferraresi is Director Business Development-South America, for Power Systems Research