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The country's largest carmaker <keyword id="44883" type="General" weightage="20" keywordseo="maruti-suzuki" source="Orion">Maruti Suzuki</keyword> India (MSI) witnessed a massive over two-fold drop in <keyword id="22637" type="General" weightage="20" keywordseo="production" source="Orion">production</keyword> last month owing to the shortage of semiconductor chips. In a regulatory filing, the auto major reported total production of 81,278 units in September as compared with 1,66,086 units in September 2020.<br /><br />"Production volume of the company in September 2021 was affected due to electronic components shortage," it noted.<br /><br />MSI said total passenger vehicle production stood at 77,782 units last month, as against 1,61,668 units in September 2020.<br /><br />Production of <keyword id="913938" type="General" weightage="20" keywordseo="mini-cars" source="Orion">mini cars</keyword> comprising Alto and S-Presso models stood at 17,163 units last month as against 30,492 units a year ago.<br /><br />Similarly, manufacturing of compact cars, comprising WagonR, Celerio, Ignis, Swift, Baleno and Dzire, declined to 29,272 units from 90,924 units earlier, MSI said.<br /><br />Production of utility vehicles -- Gypsy, Ertiga, S-Cross, Vitara Brezza and XL6 -- dropped to 21,873 units last month from 26,648 units in the corresponding month of 2020.<br /><br />The company also reported a drop in the production of its Eeco van at 8,025 units last month as compared with 11,183 units in September 2020.<br /><br />MSI said production of its light commercial vehicle Super Carry stood at 3,496 units last month, as against 4,418 units in the year-ago month.<br /><br />MSI had reported a 8 per cent drop in total production in August on a yearly basis at 1,13,937 units.<br /><br />On August 31, the auto major had announced that it expects total vehicle production in September across its plants in <keyword id="41646" type="General" weightage="20" keywordseo="Haryana" source="Orion">Haryana</keyword> and Gujarat to be just 40 per cent of the normal output due to the semiconductor shortage.<br /><br />The company's production capacity at Gurgaon and Manesar plants in Haryana is around 15 lakh units per annum.<br /><br />Besides, Suzuki Motor Gujarat (SMG), a 100 per cent subsidiary of Japan's <keyword id="100743" type="General" weightage="20" keywordseo="suzuki-motor-corporation" source="Orion">Suzuki Motor Corporation</keyword>, has an additional installed production capacity of 7.5 lakh units per annum.<br /><br />SMG supplies cars exclusively to MSI.<br /><br />Semiconductors are silicon chips that cater to control and memory functions in products ranging from automobiles, computers and cell phones to various other electronic items.<br /><br />The usage of semiconductors in the auto industry has gone up globally in recent times with new models coming with more and more electronic features such as Bluetooth connectivity and driver-assist, navigation and hybrid-electric systems.<br /><br /><strong>SEE ALSO:<br /><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/ai-powered-professional-networking-platform-lunchclub-is-now-open-for-indian-users/articleshow/86936966.cms">AI-powered professional networking platform Lunchclub is now open for Indian users</a><br /></strong><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/is-urban-company-heading-the-ola-uber-way-with-over-100-beauticians-taking-to-the-street/articleshow/86935701.cms"><strong>Is Urban Company heading the Ola, Uber way with over 100 beauticians taking to the street?</strong></a><br />

Maruti Suzuki reports over two-fold dip in production in September

New Delhi, May 2 () Maruti Suzuki India on Saturday said its car seat manufacturing joint venture, Krishna Maruti Ltd, has handed over the first batch of 5 lakh units of triple-ply face masks to Gujarat administration at Gandhinagar. <p> Krishna Maruti, the joint venture between Maruti Suzuki and Krishna Group, had committed to donating 10 lakh triple-ply masks to Gujarat government.</p><p> The mask was developed by engineers of Maruti Suzuki and Krishna Group with almost hourly monitoring by Maruti Suzuki management and active support by Department of Textiles, Government of India and was finally approved by SITRA laboratory.</p><p> Speaking on the initiative, Krishna Group Chairman Ashok Kapur said, "We have committed 1 million masks each to Haryana and Gujarat governments."</p><p> "I am also planning to import some machines and produce N-95 masks. All important safety and physical distancing guidelines were observed while manufacturing these masks at our facilities to ensure the safety of all the staff."</p>Krishna group has its manufacturing plant next to Suzuki Motor Gujarat (SMG) plant at Hansalpur. SMG, which is a subsidiary of a Suzuki Motor Corp, manufactures cars on a contract basis for Maruti Suzuki India Ltd.  RKL  MRMR

Maruti Suzuki India JV hands over 5 lakh face masks to Guj govt

New Delhi, Mar 23 () Auto stocks plunged up to 20 per cent on Monday as companies have suspended their production due to the coronavirus outbreak.<p> Motherson Sumi Systems cracked 20 per cent and Ashok Leyland fell 18 per cent, Maruti Suzuki India (17.02 per cent), Bajaj Auto (13.95 per cent) and  Apollo Tyres (13.86 per cent).</p><p> Shares of TVS Motor Company settled 12.94 per cent down while that of MRF and Eicher Motors dropped 12.34 per cent and 11.87 per cent, respectively, on the  BSE.</p><p> Likewise, Hero MotoCorp declined 11.07 per cent, Tata Motors (9.95 per cent) and M&amp;M (9.06 per cent).</p><p> The BSE Auto Index tumbled by 13.35 per cent.</p><p> The country's largest two-wheeler maker Hero MotoCorp on Sunday said it has suspended production at all its sites across the globe until March 31, 2020 in order to safeguard its employees against coronavirus infections.</p><p> On Monday, Maruti Suzuki India (MSI) said Suzuki Motor Gujarat has suspended production at its Gujarat-based plant to check the spread of COVID-19.</p><p> Suzuki Motor Gujarat manufactures cars on contract basis for MSI.</p><p> The company has been informed by Suzuki Motor Gujarat Pvt Ltd (SMG) that pursuant to Gujarat government directive to check the spread of COVID-19  transmission, they are closing their plant operations with effect from B-shift from March 23 through March 25, 2020, as per a regulatory filing.</p> Rockman Industries, the auto components arm of the Hero Group, on Monday said it has suspended all operations at its seven manufacturing facilities till March-end due to coronavirus outbreak.  SUM  RAM

Coronavirus: Auto stocks skid up to 20 pc on production suspension

<p></p><div class="KonaFilter image-container display-table lead-image-small"><div><div class="image on-image"></div><p></p></div></div><ul class="summary-list"><li><a href="https://www.businessinsider.com/category/apple" target="_blank" rel="noopener">Apple's</a> campus search, which concluded earlier this week, was conducted fairly quietly, especially compared to rivals like Amazon.</li><li>That's because Apple's main goal wasn't to gain the maximum incentives from local governments.&#xa0;</li><li>Instead, it wanted to portray itself as a job creator and American company for two reasons: To repay Trump for tax reform, and to protect the iPhone from Trump's tariffs and trade wars.&#xa0;</li></ul><p>Earlier this week, Apple <a href="https://www.apple.com/newsroom/2018/12/apple-to-build-new-campus-in-austin-and-add-jobs-across-the-us/">made a big announcement</a>, saying that it planned to open a new campus in Austin, Texas, as well as expand operations in Seattle, Los Angeles, and San Diego.</p><p>The announcement landed in the middle of the night: at 12 p.m. Pacific Time, or when most of the East Coast should be sleeping.</p><p>Even Apple CEO Tim Cook was probably sleeping when it crossed. He famously gets up at 4:00 a.m. and tries to get seven hours of sleep.&#xa0;</p><p>It wasn't quite a news dump, but 3 a.m. ET isn't the best time to announce news if you want to make headlines.&#xa0;</p><p><a href="https://news.google.com/stories/CAAqaAgKImJDQklTUXpvSmMzUnZjbmt0TXpZd1NqWUtFUWpLamVxcWpZQU1FZHo1TkVPNEJMNDdFaUZCY0hCc1pTQmhibTV2ZFc1alpYTWdKREZpSUVGMWMzUnBiaUJqWVcxd2RYTW9BQVAB?hl=en-NZ&amp;gl=NZ&amp;ceid=NZ%3Aen" target="_blank" rel="noopener">Apple got the headlines anyway</a> with its announcement, but the way it was rolled out reveals a core motivation behind Apple's public expansion - one that has far different aims than Amazon's HQ2 contest. Whereas Amazon was looking for public subsidies and information from its campus search, Apple's aims were political.</p><p>In fact, Apple's announcement ultimately had an audience of one: President Donald Trump.&#xa0;</p><p>Sure, the announcement means a lot to Apple employees, Texans, and people in any number of the cities where Apple is expanding. And Apple did get some financial incentives from the state of Texas as part of its search. But more than sharing the news, Apple's announcement was meant to underscore the fact that it's an American company, with lots of American employees - even if the iPhone is largely manufactured in China.&#xa0;</p><p>Apple doesn't usually talk about expansion plans or the number of people it plans to hire. So why did it put out a press release in the middle of the night?&#xa0;</p><h2>A fraught relationship</h2><p></p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div><p>The fraught relationship between the President and the CEO of the country's often-most-valuable company started in 2016.&#xa0;</p><p>Cook supported Hillary Clinton in the presidential election, and held a fundraiser for her in Palo Alto, California. He even made it onto Clinton's <a href="https://www.businessinsider.com/wikileaks-email-shows-apple-ceo-tim-cook-on-vp-shortlist-2016-10">shortlist for vice president</a>.&#xa0;</p><p>Cook's political leanings are not public, and he's been supportive of both Democrats and Republicans, including Paul Ryan. But as a gay CEO in Silicon Valley, where most people supported Clinton - and given Trump's campaign talking point that he'd like Apple to make <a href="https://www.businessinsider.com/donald-trump-ill-make-apple-build-in-the-us-2016-1">iPhones and other computers in the United States</a> - the support for Clinton made sense.</p><p>Plus, at the time, Clinton was projected to win by nearly every major poll. Supporting her was business as usual.&#xa0;</p><p>Then Trump won.&#xa0;</p><p>A month later, Cook - along with top leaders from Google, Facebook, Amazon, and other big tech companies - went to Trump Tower to meet with the then-president-elect in person.</p><p><a href="https://www.businessinsider.com/trump-meeting-photo-jeff-bezos-elon-musk-tim-cook-2016-12">You've probably seen the photos from that meeting</a>. Cook doesn't look very happy. But he needed to do it to support Apple's two major policy goals.&#xa0;</p><h2>Corporate tax reform</h2><p></p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div><p>Apple had two things it wanted from the Trump administration.</p><p>Most importantly, it wanted corporate tax reform. Cook laid out Apple's goals in this area in an <a href="https://www.washingtonpost.com/sf/business/2016/08/13/tim-cook-the-interview-running-apple-is-sort-of-a-lonely-job/?utm_term=.123d18c78fe6">interview with the Washington Post</a> in 2016 before Trump was elected.&#xa0;</p><p>"I think it's in the best interest of the US to have corporate tax reform, regardless of which political party is in charge of the White House," Cook said.&#xa0;</p><p>"The tax law right now says we can keep that in Ireland or we can bring it back. And when we bring it back, we will pay 35% federal tax and then a weighted average across the states that we're in, which is about 5 percent, so think of it as 40 percent. We've said at 40 percent, we're not going to bring it back until there's a fair rate," Cook continued.</p><p>Apple had collected more than $250 billion in cash and marketable securities on its books. All that money was technically on the books of an Irish subsidiary, and Apple wanted to bring it back to the United States so it could return it to shareholders in the form of dividends and share buybacks.</p><p>In December 2017, Apple got what it wanted. A tax bill backed by Republicans and Trump was passed, bringing widespread changes to the US tax code, including a carve-out allowing for a one-time repatriation of corporate cash held abroad at a lower tax rate than previously possible.&#xa0;</p><p>A month later, Apple <a href="https://www.apple.com/newsroom/2018/01/apple-accelerates-us-investment-and-job-creation/">put out a press release</a> that said it planned to bring all of its overseas cash back to the US, saving it tens of billions of dollars in tax implications. That announcement was also when it first said it would build a new campus.</p><p>Trump noticed. "I promised that my policies would allow companies like Apple to bring massive amounts of money back to the United States. Great to see Apple follow through as a result of TAX CUTS," Trump <a href="https://twitter.com/realdonaldtrump/status/953771038114045954?lang=en">wrote on Twitter</a>.</p><h2>Big, beautiful plants</h2><p>But saving billions on taxes was only one of Apple's two goals with its Trump administration outreach.</p><p>The second policy goal was to prevent Trump's <a href="https://www.nytimes.com/interactive/2018/12/12/business/economy/tariff-man-origin-story.html">penchant for tariffs</a> from affecting the iPhone, which is primarily manufactured in China, although there are some US-made components.&#xa0;</p><p>Trump had said before the election that he wanted Apple to do manufacturing in the United States, which most experts say <a href="https://www.businessinsider.com/why-donald-trumps-plan-to-build-iphones-in-us-wont-work-2016-3">is impossible</a> for a product like the iPhone. Too much of the supply chain is based in Asia.&#xa0;</p><p>Trump had also gone on the record multiple times saying that Apple planned to build "<a href="https://www.businessinsider.com/trump-apple-ceo-tim-cook-promised-to-build-three-plants-united-states-2017-7">three big plants</a>" in the United States - a claim that Apple has never confirmed nor denied, although it does not make sense. Apple doesn't build factories; it contracts with companies like Foxconn to build its products.&#xa0;</p><p>So while Apple couldn't say it was building manufacturing plants, like Trump wanted it to say, it could do the next best thing: tout new high-quality jobs and offices it was creating.&#xa0;</p><p>Otherwise, Trump could put a tariff on the iPhone - as he <a href="https://www.wsj.com/articles/trump-expects-to-move-ahead-with-boost-on-china-tariffs-1543266545">threatened in November</a>.</p><p>Apple has grown prodigiously over the past decade. It probably would have needed 20,000 new employees anyway. But Apple cast itself as a job creator - it wasn't just hiring, it was creating new jobs. And these jobs aren't the kind where workers <a href="https://www.businessinsider.com/qa-with-an-iphone-factory-worker-at-pegatron-changshuo-in-shanghai-2017-4">screw a single screw into the iPhone over and over</a>, they were good "middle skill" jobs, like call center employees.&#xa0;</p><p>Thus the press release on Thursday, basically confirming much of what Apple said back in January about its planned expansion. It highlighted how many Americans Apple employ, and how many states it's based in. And ultimately, it gave Trump an opportunity to claim credit for the jobs Apple is hiring for.</p><p>Of course, Trump noticed the announcement. After all, it was basically targeted directly at him.&#xa0;</p><p>"Thank you to Tim Cook for agreeing to expand operations in the U.S. and thereby creating thousands of jobs!" Trump tweeted.&#xa0;</p><p>&#xa0;</p><div></div><div></div><div></div><div></div><div></div><div></div>    <div class="margin-top">        <h3>NOW WATCH: <a href="https://www.businessinsider.com/bmw-self-driving-motorcycle-driverless-tech-2018-10">Watch BMW's self-driving motorcycle accelerate, turn, and brake to a stop</a></h3>        <div>                    </div>    </div>

Apple's big campus announcement had a very specific audience - Trump

NEW DELHI: <keyword id="44883" type="CITY" weightage="20" keywordseo="Maruti-Suzuki">Maruti Suzuki</keyword> India Ltd (MSIL) has appointed two local investment bankers — Kotak Mahindra Capital and Axis Capital — as the company seeks to persuade minority investors to back a controversial plan that calls for the carmaker's proposed Gujarat factory to be set up by parent <keyword id="200508" type="COMPANY" weightage="20" keywordseo="Suzuki-Motor-Corp-">Suzuki Motor Corp.</keyword><br />
<br /> Maruti <keyword id="6911" type="CITY" weightage="20" keywordseo="suzuki">Suzuki</keyword>'s manufacturing will be contracted to the plant in a practice that some experts say is unusual for the industry. The move has been opposed by some shareholders who believe it will undermine the Indian unit and divert income to the parent.<br />
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Maruti Suzuki is seeking minority shareholder approval under Section 188 of the Companies Act for the special resolution related to the plan. It needs the support of at least three-fourths of its public shareholders to get the proposal passed, which in effect means a bloc with an 11% stake can block the resolution.<br />
<br /> <keyword id="111052" type="CITY" weightage="20" keywordseo="Suzuki-Motor">Suzuki Motor</keyword> owns a 56.21% stake in MSIL, with the rest being held by the public. The investment bankers won't have any role in trying to sway investors, a Maruti Suzuki spokesperson said by email. They "have not been appointed to convince the institutional investors — domestic or foreign — to vote in favour of the Gujarat project structure," he said. That's being done by a Maruti Suzuki team led by chairman RC Bhargava and managing director and CEO Kenichi Ayukawa, he said.<br />
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"The investment bankers are required to identify the investors in various parts of the world, arrange the meetings with them and the necessary logistical support. They are also involved in discussions with MSIL in finalizing the presentations and strategy for the discussions," he said.<br />
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The margin of victory needed to get the plan approved came in for some questioning. "The new law requires that the proposal be passed by a special resolution. It is not clear why 26% of minority shareholders should be able to override 74% of minority shareholders in a vote where the promoter is not voting," the spokesperson said.<br />
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After strong concerns were raised by domestic institutional investors over the issue, all eyes are now on Life Insurance Corp. (LIC) of India that owns a 6.63% stake in Maruti Suzuki. Domestic mutual funds, which together own a 6.16% stake in Maruti Suzuki, have already opposed the plan.<br />
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In case LIC joins hands with them, the combined holding of those against the move would cross 12%, enough to block the resolution. "Given the stance taken by LIC in the case of Cairn India depositing $1.25 billion (Rs 7,500 crore) with its parent Sesa Sterlite, there is all likelihood that the largest Indian institutional investor is likely to oppose the proposal," said the head of one of the mutual funds.<br />
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Maruti Suzuki pointed out that the objections by the domestic funds predate changes to the plan. "The letter was written before the March modifications to the original structure," the spokesperson said. "After the March modifications, no one has written to us conveying any concerns about the proposal."<br />
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A senior LIC official, who didn't want to be named, said, "LIC has always worked to protect the interests of investors and this case will not be any different." Some believe the state-owned insurer may not oppose the plan. "The feedback we have received that it would support the proposed structure," said another mutual fund head.<br />
<br /> Incidentally, Suzuki Motor chairman Osamu Suzuki met Prime Minister <keyword id="6354477" type="PERSON" weightage="20" keywordseo="Narendra-Modi">Narendra Modi</keyword> last week. Mutual fund representatives said the appointment of investment bankers is also aimed at gauging the pulse of investors. In case they're not able to convince more than three-fourths of public shareholders, Maruti Suzuki may revisit its plan to seek shareholder approval.<br />
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The next annual general meeting is set for September 4, but the proposal is not on the agenda. "We would not be ready for the vote on this matter by September 4, as we would not have completed our meetings with all investors in India and abroad," said the spokesperson.<br />
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The resolution will be taken up at a later time. "The company plans to have a separate shareholders' meeting sometime later this year, which will be contingent upon the ongoing exercise to bring large investors on its side," said a fund manager.<br />
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If the Maruti Suzuki plan goes ahead, it could set a precedent. Many promoters of listed companies would prefer to follow the same route that will result in destroying shareholder value, said a senior executive at an insurance company.<br />
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"This opens up the door to every single promoter converting their listed company into a marketing arm. Will they now set up manufacturing outfits as 100% owned entities that sell through the listed company?" said Amit Tandon, CEO of Institutional Investor Advisory Services. "On what basis will companies be valued? And where does this end?"<br />
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In March, a group of 19 leading domestic institutional investors that includes HDFC Mutual Fund, Birla Sun Life, ICICI Prudential, Reliance Mutual Fund, UTI SBI Mutual Fund and Axis Bank Mutual Fund among others wrote to Maruti Suzuki raising serious concern over the transaction.<br />
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"As a policy, we don't comment on market rumours or speculations, hence we would not like to comment on this," said an Axis Bank official. Kotak did not reply to ET's queries. Under the proposed transaction, Suzuki Motor plans to set up the Gujarat project as part of its whollyowned subsidiary, Suzuki Motor Gujarat Pvt (SMG), which in turn will enter into an exclusive long-term contract manufacturing agreement with Maruti Suzuki.<br />
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The contract manufacturing agreement would initially be for 15 years and will be automatically extended for a further 15 unless the parties mutually agree to terminate it.<br />
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Maruti Suzuki said this would allow it to save on the investment required for setting up the plant to the extent of the equity investment made by Suzuki Motor in SMG. However, the fund managers said Maruti Suzuki is a debt-free company with cash and investments worth Rs 8,000 crore, which earns less than 10% annually, compared with the 20% return on equity.<br />
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"Why should idle money not be invested in equity with clear visibility of business," said a fund manager. Maruti Suzuki is confident of gaining the support of stakeholders. "We believe that the financial benefits to minority shareholders are so obvious and large, that the vote would support the proposed structure," the spokesperson said.<br />
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