Monday, November 28, 2011

Tata Nanos Aren’t Cheap Enough as India Chooses Motorbikes:Cars

Nov. 29 (Bloomberg) -- India’s inflation is producing an unexpected beneficiary. Motorcycle makers are poised for record sales this year as the highest borrowing costs among Asia’s major economies push consumers to choose a cheaper ride.


Two-wheeler deliveries rose 2 percent in October, extending consecutive monthly gains since January 2009, while passenger- vehicle sales tumbled the most in more than a decade, as the central bank implemented the fastest round of interest rate increases in its history.
“The worst affected is the passenger-car market, where the dependence on loans and the ticket price is high,” said Ravi Sud, chief financial officer of Hero MotoCorp. Ltd., maker of almost half the motorcycles in India. “Only about 30 percent of buyers buy a motorcycle with a loan.”

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