MUMBAI (Reuters) – Mahindra & Mahindra is finding it tough to exorcise the ghosts of failed Chinese ownership at its South Korean car unit Ssangyong as it looks to push the brand into China’s auto market, the world’s largest.

At the same time, the Indian car, tractor and truck maker, the core part of the $14.4 billion diversified Mahindra Group, will take its own rugged sport utility vehicles (SUVs) elsewhere, to emerging markets such as Brazil and South Africa – though it is developing engines to be used across both brands.

Mahindra’s muscular jeeps have for decades been a favourite in India’s rural hinterland, and its tractors work fields from Arizona to Zimbabwe. Cracking the Chinese market with Ssangyong would mark the next frontier for a company that has used booming domestic growth to fuel its global ambitions.

“China is a high priority for Ssangyong, but not for Mahindra,” said Pawan Goenka, president of Mahindra’s automotive and farm equipment sectors and chairman of Ssangyong, which the Indian company bought for $460 million in March last year.

Ssangyong Motor Co, which trails far behind Korean rivals Hyundai Motor and Kia Motors but is popular in Russia, was close to bankruptcy under its Chinese owners SAIC Motor Corp when Mahindra stepped in to buy a 70 percent stake.

The Indian firm started importing Ssangyong cars into China late last year, but has had “limited success” in a market that is slowing and which regards Ssangyong as a premium brand, Goenka said in an interview at Mahindra’s headquarters in central Mumbai.

“An important hurdle we faced was the ‘ghost of the past’ at Ssangyong. They were clearly badly bitten by SAIC.”

MUMBAI, May 24 (Reuters) – India’s Mahindra & Mahindra is finding it tough to exorcise the ghosts of failed Chinese ownership at its South Korean car unit Ssangyong as it looks to push the brand into China’s auto market, the world’s largest.

At the same time, the Indian car, tractor and truck maker, the core part of the $14.4 billion diversified Mahindra Group, will take its own rugged sport utility vehicles (SUVs) elsewhere, to emerging markets such as Brazil and South Africa - though it is developing engines to be used across both brands.

Mahindra’s muscular jeeps have for decades been a favourite in India’s rural hinterland, and its tractors work fields from Arizona to Zimbabwe. Cracking the Chinese market with Ssangyong would mark the next frontier for a company that has used booming domestic growth to fuel its global ambitions.

“China is a high priority for Ssangyong, but not for Mahindra,” said Pawan Goenka, president of Mahindra’s automotive and farm equipment sectors and chairman of Ssangyong, which the Indian company bought for $460 million in March last year.

Ssangyong Motor Co, which trails far behind Korean rivals Hyundai Motor and Kia Motors but is popular in Russia, was close to bankruptcy under its Chinese owners SAIC Motor Corp when Mahindra stepped in to buy a 70 percent stake.

The Indian firm started importing Ssangyong cars into China late last year, but has had “limited success” in a market that is slowing and which regards Ssangyong as a premium brand, Goenka said in an interview at Mahindra’s headquarters in central Mumbai.

“An important hurdle we faced was the ‘ghost of the past’ at Ssangyong. They were clearly badly bitten by SAIC.”

MUMBAI, May 22 (Reuters) – Car maker Fiat SpA, which recently split with its distribution partner in India, is open to bringing all of its vehicle brands to the country, said a senior executive who will soon take charge of the Italian company’s India operations.

Fiat India aims to open more than 100 showrooms by the end of 2014, and is mulling bringing its Chrysler, Jeep, Fiat Commercial and other brands to the country as it looks to ramp up its current lacklustre market share.

“We are investigating all the brands… we have a huge number of brands and models that we can look at, including those from the Chrysler stable,” Enrico Atanasio, head of commercial operations at Fiat India Automobiles, told Reuters.

Atanasio, who told Reuters he will take control of Fiat’s Indian unit as its managing director within the next few weeks, added that the company was open to importing, assembling or locally manufacturing any new brands brought to the country.

“Today we’re in an unsatisfactory place in terms of market share,” he said, adding that Fiat wants to expand beyond its current offerings in the compact and mid-range sedan segments.

“Once we fulfil the network, we’ll be looking at other segments above and below that,” he said.

Earlier this month, the Italian car maker announced the end of a six-year distribution and marketing agreement with India’s Tata Motors, and opened its first two dedicated Fiat showrooms over the past fortnight.

MUMBAI, May 9 (Reuters) – At the opening ceremony for Daimler AG’s $850 million India factory, Chairman Dieter Zetsche stepped down from the cab of a gleaming yellow 25-tonne truck with scaled-down horsepower, a stripped-back gearbox and no sign of the iconic Mercedes-Benz three-pointed star on its grille.

Daimler has been assembling high-end trucks in India for years, but its recently launched cut-price BharatBenz line has joined a trend by global heavy equipment manufacturers to compete in India’s high-volume, high-growth – but cost-conscious - mass market.

The potential is huge. Truck sales alone grew 18 percent in the year to March 2012 to over 800,000 vehicles, and are expected to double to 1.6 million by 2017. This eclipses the United States, where just over 300,000 commercial trucks were sold in 2011.

But it’s a market where being best isn’t good enough. To target the low end of India’s engineering markets, which accounts for over 70 percent of sales, manufacturers need to offer the best value, and to do that they need to go local.

The BharatBenz 2523, a 25-tonne truck, will likely cost around 1.75 million rupees ($33,300) before tax. That’s less than half the price of a comparable Mercedes-Benz Axor 2529 that retails in Europe for 61,000 euros ($81,000).

“If customers can get gear manufactured by the global firms at lower or equal price points compared to the domestic manufacturers, then naturally there will be serious demand for international kit,” says Bharti Momaya, chief manager at distributor firm, Ajisons, which sells locally-made switchgear in Mumbai.

Car makers have been localising their products for years, sourcing materials and making cheap, India-tailored vehicles. India-made cars from companies such as Ford or South Korea’s Hyundai which poured billions of dollars into India in the 1990s now command 75 percent of the market.

MUMBAI (Reuters) – Hero MotoCorp(HROM.NS: Quote, Profile, Research), the world’s largest two-wheeled vehicle manufacturer, hiked prices and targeted industry-beating future sales growth as it blamed forex movements and rising input costs on quarterly profit that missed estimates.

Hero will target a ramping up of exports and capacity to drive growth, after material cost increases during the quarter to end-March outstripped revenue growth as a weaker rupee raised the cost of imports.

“There was a lot of damage that happened to the foreign exchange fluctuations,” said Ravi Sud, chief financial officer. “Out of whatever (cost) increase has come per unit in this quarter, about 70 to 75 percent is on account of forex.”

Imports account for around 15 percent of the company’s vehicle costs, Sud added. The Indian rupee weakened by around 13.5 percent against the dollar during the year to March 31.

Hero expects two-wheeler sales growth of 10 percent in the current fiscal year, said Anil Dua, senior vice-president of marketing and sales, outstripping industry growth as the company continues to increase its focus on a largely untapped rural market.

The company, which split from 26 year partner Honda Motor Co (7267.T: Quote, Profile, Research) last year in an $850 million deal, said it had raised prices of most of its products by 500 rupees to 1,000 rupees with immediate effect.

Hero said in a statement that rising input costs were to blame for the hike. The company’s motorcycles start at around 40,000 rupees.

MUMBAI, May 2 (Reuters) – India’s Hero MotoCorp, the world’s largest two-wheeled vehicle manufacturer, hiked prices and targeted industry-beating future sales growth as it blamed forex movements and rising input costs on quarterly profit that missed estimates.

Hero will target a ramping up of exports and capacity to drive growth, after material cost increases during the quarter to end-March outstripped revenue growth as a weaker rupee raised the cost of imports.

“There was a lot of damage that happened to the foreign exchange fluctuations,” said Ravi Sud, chief financial officer. “Out of whatever (cost) increase has come per unit in this quarter, about 70 to 75 percent is on account of forex.”

Imports account for around 15 percent of the company’s vehicle costs, Sud added. The Indian rupee weakened by around 13.5 percent against the dollar during the year to March 31.

Hero expects two-wheeler sales growth of 10 percent in the current fiscal year, said Anil Dua, senior vice-president of marketing and sales, outstripping industry growth as the company continues to increase its focus on a largely untapped rural market.

The company, which split from 26 year partner Honda Motor Co last year in an $850 million deal, said it had raised prices of most of its products by 500 rupees to 1,000 rupees ($9 to $19) with immediate effect.

Hero said in a statement that rising input costs were to blame for the hike. The company’s motorcycles start at around 40,000 rupees.

ORAGADAM, India, April 18 (Reuters) – Daimler AG entered India’s truck market on Wednesday promising reliable and efficient vehicles in an $850 million bet on a price-sensitive market dominated by local players that other foreign manufacturers have struggled to crack.

Daimler, the world’s largest truck maker, is betting on its high-quality and technologically superior BharatBenz commercial vehicles in India as it looks to win a piece of the world’s fastest-growing truck and bus market.

“The initial purchase price may be a single-digit percent higher than others, but BharatBenz products have a total ownership cost that is value for money,” said Andreas Renschler, Daimler’s trucks head, without providing specifics.

India’s roads transport around 65 percent of the country’s freight, but are typically plied by old and inefficient trucks, precariously piled cargo strapped down with rope and covered with tarpaulins flapping in the wind.

The Stuttgart, Germany-based automaker, which also makes its luxury Mercedes-Benz cars in India, is banking on transport companies stumping up for its advanced technology, but could face a pricing challenge in a developing market.

“Our focus is the modern domestic segment which has much higher standards than the majority of trucks on Indian roads today … Work-life and durability will be much larger than comparable trucks,” Renschler said.

Commercial vehicle sales in India have more than doubled over the past six years to around 800,000 per year, outstripping car sales growth, as construction booms and infrastructure development increases in Asia’s third-largest economy.

MUMBAI (Reuters) – Japanese automaker Honda’s Indian marriage is on the rocks.

Accusations by its local partner of “inappropriate” corporate governance and a tussle over future investment have exposed the perils of operating in a business model that has run out of gas for foreign automakers in India’s booming car market.

As sales and their confidence rises, overseas manufacturers are tearing up local partnerships and pumping billions of dollars into wholly-owned Indian units, encouraged by the government’s hands-off policy that gives it an edge over Asian rival China.

With more foreign car makers choosing to have complete control of their Indian businesses, investment is increasing, capacity is rising, and Asia’s third-largest economy is fast challenging Thailand and China as an automobile export hub.

“The automotive industry requires significant investment, particularly at the initial stages, coupled with a lengthy product development cycle,” Michael Boneham, president of Ford Motor Co’s (F.N: Quote, Profile, Research) wholly-owned India unit told Reuters.

“Such capital intensiveness can be burdensome on partnerships, and the need for large investment and R&D can be difficult to maintain if it’s not your core business.”

Like Honda (7267.T: Quote, Profile, Research) , Ford entered India in a joint venture, with Mahindra & Mahindra (MAHM.NS: Quote, Profile, Research) in 1995. That lasted 10 years and sold a total of 120,000 cars. By comparison, Ford’s subsequent solo venture, which has committed $2 billion (1.3 billion pounds) to India, shifted almost 100,000 cars in the last financial year alone.

MUMBAI (Reuters) – Japanese automaker Honda Motor Co’s (7267.T: Quote, Profile, Research) Indian marriage is on the rocks.

Accusations by its local partner of “inappropriate” corporate governance and a tussle over future investment have exposed the perils of operating in a business model that has run out of gas for foreign automakers in India’s booming car market.

As sales and their confidence rises, overseas manufacturers are tearing up local partnerships and pumping billions of dollars into wholly-owned Indian units, encouraged by the government’s hands-off policy that gives it an edge over Asian rival China.

With more foreign car makers choosing to have complete control of their Indian businesses, investment is increasing, capacity is rising, and Asia’s third-largest economy is fast challenging Thailand and China as an automobile export hub.

“The automotive industry requires significant investment, particularly at the initial stages, coupled with a lengthy product development cycle,” Michael Boneham, president of Ford Motor Co’s (F.N: Quote, Profile, Research) wholly-owned India unit told Reuters.

“Such capital intensiveness can be burdensome on partnerships, and the need for large investment and R&D can be difficult to maintain if it’s not your core business.”

Like Honda, Ford entered India in a joint venture, with Mahindra & Mahindra (MAHM.NS: Quote, Profile, Research) in 1995. That lasted 10 years and sold a total of 120,000 cars. By comparison, Ford’s subsequent solo venture, which has committed $2 billion to India, shifted almost 100,000 cars in the last financial year alone.

MUMBAI, April 16 (Reuters) – Japanese automaker Honda Motor Co’s (7267.T: Quote, Profile, Research) Indian marriage is on the rocks.

Accusations by its local partner of “inappropriate” corporate governance and a tussle over future investment have exposed the perils of operating in a business model that has run out of gas for foreign automakers in India’s booming car market.

As sales and their confidence rises, overseas manufacturers are tearing up local partnerships and pumping billions of dollars into wholly-owned Indian units, encouraged by the government’s hands-off policy that gives it an edge over Asian rival China.

With more foreign car makers choosing to have complete control of their Indian businesses, investment is increasing, capacity is rising, and Asia’s third-largest economy is fast challenging Thailand and China as an automobile export hub.

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