Even as companies are giving pink slips to employees as a result of the global meltdown, GM India is increasing its employee strength from the present 4,000 to 4,500 by 2009, a top official of the company said.
"We will be increasing the number of our employees from 4,000 to 4,500 by 2009," GM India Vice-President P Balendran told mediapersons here.
"The 500 include 300 for the car plant in Talegaon, 200 for the powertrain facility, also in Talegaon, and the engineering centre in Bangalore", he said.
On slashing prices, Balendran said the firm, which had been offering discounts ranging from Rs 2,000 to Rs 50,000, besides a discount of Rs 3,000 to Rs 5,000 to government and PSU employees during the festival season, would continue them (discounts) till the end of this month.
However, the firm is planning a price hike of 2-3 per cent in January 2009, he said. The market, Balendran said, was sluggish and the usual sales growth during the festive season, which used to be in the range of 25-30 per cent, had come down to 5-7 per cent this season.
"The main reason for the sluggishness is there is no liquidity in the market. Eighty-five per cent of GM's vehicles are financed, of which 70 per cent are by private banks," he said.
On the Talegaon plant, Balendran said, "The capacity of the plant, which commenced operations in September 2008, can go up from 1.40 lakh units now to 3 lakh units."
Source: Agencies
Tuesday, December 9, 2008
Is the slowdown, an opportunity in itself?
The current slowdown will also give an impetus to many technologies, some of which include Green IT, cloud computing, graphics and Web, writes Anil Chopra, editor at Cybermedia.
Media the world over is predicting this to be the worst economic slowdown ever. But then, people who have lived through various economic cycles would easily be able to split the hype from reality, and tell that while the causes of a slowdown vary, their impact is usually similar in nature. We can easily apply this formula to the current slowdown and predict that this one is no different from the previous one or the one before that.
Let's look at the slowdown of 2001, which happened due to the great dot com bust and compare it with the current one. Much before it actually happened, people predicted that there was a dot com bubble just waiting to burst, and bring with it a recession. But nobody of course could in their wildest of dreams predict the disaster that followed and brought down with it the US and world economy-the Sep 11 attack on WTC. Markets crashed, demands dipped, giving rise to higher unemployment, pink slips, and company closures.
Now let's come to the current slowdown. Much before it started, people knew that it would be caused by the US sub-prime crisis. Nobody however, had predicted that it would be so bad that many leading multi-national banks and financial institutes would go bankrupt. But the results of the current slowdown remain similar to the previous one-job cuts, stock market crash, dip in market demands, and the like.
So the key learning from slowdowns is that they're a way for markets to correct themselves and provide everyone an opportunity to think about the next big thing. After the dot com bust, the web emerged stronger than ever. Today everyone's going gaga over Web 2.0, social networking, and the benefits it provides. The humble server room transformed itself into a powerful data center to host business critical applications, and e-Commerce became a standard practice amongst most enterprises. The WTC attack reduced air travel, giving a boost to video conferencing, and also made DR and BCP common practice amongst enterprises.
Likewise, the current slowdown will also give an impetus to many technologies, some of which include Green IT, cloud computing, graphics, web, etc. We've talked about ten of them along with their likely future impact in this month's cover story.
It's also forcing CIOs to reduce their IT purchase and focus more on improving efficiencies within their existing IT infrastructures. We've talked about the impact of the slowdown on enterprises at length in our IT strategy guide for CIOs along with tips on how to survive the slowdown.
Lastly, the good thing about a slowdown is that it reduces complacency and forces people to think differently and identify new opportunities. So why should it be different during the current slowdown? Our IT careers story this time explains just how bad is the job market and areas that are growing.
So treat the slowdown as an opportunity and take yourself to the next level. All the best and wish you a fulfilling new year ahead!
Source: Cybermedia
Media the world over is predicting this to be the worst economic slowdown ever. But then, people who have lived through various economic cycles would easily be able to split the hype from reality, and tell that while the causes of a slowdown vary, their impact is usually similar in nature. We can easily apply this formula to the current slowdown and predict that this one is no different from the previous one or the one before that.
Let's look at the slowdown of 2001, which happened due to the great dot com bust and compare it with the current one. Much before it actually happened, people predicted that there was a dot com bubble just waiting to burst, and bring with it a recession. But nobody of course could in their wildest of dreams predict the disaster that followed and brought down with it the US and world economy-the Sep 11 attack on WTC. Markets crashed, demands dipped, giving rise to higher unemployment, pink slips, and company closures.
Now let's come to the current slowdown. Much before it started, people knew that it would be caused by the US sub-prime crisis. Nobody however, had predicted that it would be so bad that many leading multi-national banks and financial institutes would go bankrupt. But the results of the current slowdown remain similar to the previous one-job cuts, stock market crash, dip in market demands, and the like.
So the key learning from slowdowns is that they're a way for markets to correct themselves and provide everyone an opportunity to think about the next big thing. After the dot com bust, the web emerged stronger than ever. Today everyone's going gaga over Web 2.0, social networking, and the benefits it provides. The humble server room transformed itself into a powerful data center to host business critical applications, and e-Commerce became a standard practice amongst most enterprises. The WTC attack reduced air travel, giving a boost to video conferencing, and also made DR and BCP common practice amongst enterprises.
Likewise, the current slowdown will also give an impetus to many technologies, some of which include Green IT, cloud computing, graphics, web, etc. We've talked about ten of them along with their likely future impact in this month's cover story.
It's also forcing CIOs to reduce their IT purchase and focus more on improving efficiencies within their existing IT infrastructures. We've talked about the impact of the slowdown on enterprises at length in our IT strategy guide for CIOs along with tips on how to survive the slowdown.
Lastly, the good thing about a slowdown is that it reduces complacency and forces people to think differently and identify new opportunities. So why should it be different during the current slowdown? Our IT careers story this time explains just how bad is the job market and areas that are growing.
So treat the slowdown as an opportunity and take yourself to the next level. All the best and wish you a fulfilling new year ahead!
Source: Cybermedia
Obama urged to appoint a cyber security czar
Report indicates that cyber security a major threat to US and has urged president-elect Barack Obama to appoint a cyber security czar.
Cyber security will pose a major threat to the US during the next administration, a new report has said, urging.
The report, Securing Cyberspace for the 44th Presidency, issued by the Centre for Strategic and International Studies, also urged president-elect Barack Obama to appoint a cyber security czar.
"Cyber security is now a major security problem for the US. Only a comprehensive national security strategy that embraces both the domestic and international aspects of cyber security will make us more secure," said the report.
Criticizing President George W. Bush for relying on the free market to secure the nation's networks, the report accused the Department of Homeland Security of being unable to protect the government from cyber attacks.
"In no other area of national security do we depend on private, voluntary efforts. We believe that cyberspace cannot be secured without regulation," it said.
The report recommended the creation of a White House office - Assistant to the President for Cyberspace - to coordinate responses to cyber threats across domestic, intelligence, military and economic elements of the government. It called for increased funding for research into cyber security.
Cyber security will pose a major threat to the US during the next administration, a new report has said, urging.
The report, Securing Cyberspace for the 44th Presidency, issued by the Centre for Strategic and International Studies, also urged president-elect Barack Obama to appoint a cyber security czar.
"Cyber security is now a major security problem for the US. Only a comprehensive national security strategy that embraces both the domestic and international aspects of cyber security will make us more secure," said the report.
Criticizing President George W. Bush for relying on the free market to secure the nation's networks, the report accused the Department of Homeland Security of being unable to protect the government from cyber attacks.
"In no other area of national security do we depend on private, voluntary efforts. We believe that cyberspace cannot be secured without regulation," it said.
The report recommended the creation of a White House office - Assistant to the President for Cyberspace - to coordinate responses to cyber threats across domestic, intelligence, military and economic elements of the government. It called for increased funding for research into cyber security.
Is Arun Sarin being considered for Yahoo CEO post?
The former chief executive of Vodafone Group Plc, Arun Sarin, is among those being considered by board members at Yahoo Inc to take Arun Sarin Tycoons with a golden heart
Modern Moguls the top job at the internet firm, the Wall Street Journal said, citing people familiar with the matter.
Yahoo's directors are moving closer to a recommendation and have authorized checking references on a few key candidates, the paper said.
Yahoo could not be immediately reached for comment.
The names of several executives of leading technology and media companies have been floating around as possible replacements to Yahoo co-founder Jerry Yang.
Yang agreed to resign as CEO last month after investors criticized him for management missteps. The company said at the time that it was hiring executive search firm Heidrick & Struggles.
Source: Agencies
Modern Moguls the top job at the internet firm, the Wall Street Journal said, citing people familiar with the matter.
Yahoo's directors are moving closer to a recommendation and have authorized checking references on a few key candidates, the paper said.
Yahoo could not be immediately reached for comment.
The names of several executives of leading technology and media companies have been floating around as possible replacements to Yahoo co-founder Jerry Yang.
Yang agreed to resign as CEO last month after investors criticized him for management missteps. The company said at the time that it was hiring executive search firm Heidrick & Struggles.
Source: Agencies
Have 30,000 lost jobs over the past one week?
News of the US officially slipping into recession seems to have spurred another round of massive retrenchment, as the first week of December alone saw a stunning 30,000 layoffs, with more than half happening in the world’s largest economy.
The whopping numbers are just a continuation of a strained labour market as employers in America slashed 5,33,000 jobs in the month of November, the maximum downsizing in 34 years. Right from telecom giant AT&T to battered banking major Credit Suisse to steel maker ArcelorMittal, the layoffs are spread across the sectors, amid the worst financial turmoil since the great depression of 1930s.
Moreover, since the start of recession in December last year, as concluded by the National Bureau of Economic Research, 1.9 million people lost their jobs and two-thirds of the losses happened in the last three months. Leaving a gloomy November, this month’s layoffs are led by AT&T which would slash 12,000 jobs or about four per cent of its total workforce.
JP Morgan is reportedly planning to reduce its workforce by 21%. The move is expected to result in 4,000 employees being given the pink slip by January at Washington Mutual.
Source: Agencies
The whopping numbers are just a continuation of a strained labour market as employers in America slashed 5,33,000 jobs in the month of November, the maximum downsizing in 34 years. Right from telecom giant AT&T to battered banking major Credit Suisse to steel maker ArcelorMittal, the layoffs are spread across the sectors, amid the worst financial turmoil since the great depression of 1930s.
Moreover, since the start of recession in December last year, as concluded by the National Bureau of Economic Research, 1.9 million people lost their jobs and two-thirds of the losses happened in the last three months. Leaving a gloomy November, this month’s layoffs are led by AT&T which would slash 12,000 jobs or about four per cent of its total workforce.
JP Morgan is reportedly planning to reduce its workforce by 21%. The move is expected to result in 4,000 employees being given the pink slip by January at Washington Mutual.
Source: Agencies
Monday, December 8, 2008
Booster shots for global meltdown victims!
As the global economic slowdown spreads, countries after countries have announced rescue packages. The United States has so far committed $8.317 trillion to tackle the crisis. The United Kingdom, France, Russia, China and the European Union also have announced various stimulus packages.
Here’s a look at the specific fire-fighting measures announced by various countries.
United States
President-elect Barack Obama crafting $175 bn package to create 2.5 million jobs
President George Bush signed a $168 bn, 2-yr stimulus into law in early 2008
Package includes tax rebates of up to $600 per individual earning $75,000 gross income
Declared two stimulus packages worth $ 1.5 billion
Financial Package One
Bill to disburse $700 bn in stages
After the first $250 bn is authorised, President could request another $100 bn
Final $350 bn could be cleared by a further act of Congress
Financial Package Two
Fed will purchase up to $600 billion more in mortgage-related assets
Fed will lend up to $200 billion to the holders of securities backed by various types of consumer loans
Fed will buy up to $100 billion in direct obligations from mortgage giants
US Govt Measures
Up to about $1.8 trillion in Fed purchases of top-rated US dollar commercial paper under a facility launched in October
Up to about $1.9 trillion in new Federal Deposit Insurance Corp (FDIC) guarantees for banks
Up to $800 billion in Fed support for mortgage and consumer credit markets
Up to $600 billion in Fed purchases of US dollar commercial paper and certificates of deposit under a Money Market Investor Funding
Up to $900 billion in Fed Term Auction Facility loans was offered to meet financial institutions' cash needs
Unlimited commitments to lend through discount window to banks and broker dealers(totaled $296.82 billion as of Nov. 19)
$700 billion for the Treasury to buy equity stakes in financial institutions
Treasury, the FDIC and the Fed have agreed to shoulder up to $249.3 billion in losses from a Citigroup portfolio
Unlimited temporary Fed currency swap lines with the Central banks, Fed maintains $165 billion in swap lines with other banks
Up to $50 billion from the Great Depression-era Exchange Stabilisation Fund
At least $26.57 billion in Treasury direct purchases of mortgage-backed securities since September
$200 billion to backstop Fannie Mae and Freddie Mac
Up to $144 billion in additional MBS purchases by Fannie Mae and Freddie Mac
AIG will get up to $152.5 billion in support from Treasury equity purchases
$300 billion for the Federal Housing Administration to refinance failing mortgages
$4 billion in grants to local communities to help them buy and repair homes
$29 billion in financing for JPMorgan Chase's government-brokered buyout of Bear Stearns & Co in March.
France
President Sarkozy unveiled a $32.9 billion stimulus plan
Targeting investment projects rather than directly aiding consumer
Measure to boost GDP by 0.6% by 2009
French package will cost 1.3% of GDP, will push budget deficit to 3.9%
Budget deficit will be above the European Union’s 3% limit
EU allowed the exceed budget limits in 2009
United Kingdom
Prepared a $29.06 bn package centering around consumer tax cut
Announced a range of tax cuts and govt spending over 18 months
Package includes 2.5% cut in VAT to 15%, postponement of corporate increase
Package will increase public borrowing to $178.6 bn next year, nearly 8% of Britain’s GDP
Germany
Unveiled plans worth 31 billion euros or 1.25% of GDP
Govt refusing to deliver tax cuts to help stimulate economic growth
Package will generate investments and new contracts worth over 50 billion euros over 2 years
New lending of up to 15 billion euros will be introduced, strengthen its lending activities
Russia
Unveiled $20 billion economic stimulus package
Package includes cut in profit tax to 24% from 20%
Govt sanctioned state-run banks to support industry with billions of dollars of soft lending
European Union
Fiscal boost amounting to 200 billion euros($260 bn), nearly 1.5% of EU’s GDP
EU commission urges member-states to commit 170 billion euros to their own rescue package
Considering system of guarantees and loan subsidies where credit is tight
Aid to SMEs increased to 30 billion euros from 10 billion Euros
China
Introduced stimulus package worth 4 trillion yuan ($586 bn)
Package mainly for govt spending on infra projects and earthquake-related relief work
Stimulus package to boost domestic demand through 2010
VAT rule changes allows companies to deduct the cost of core investment expenses
Govt increased export tax rebates for wide range of products
Australia
More than $ 12 bn for auto industry, family benefit and domestic residential backed mortgage market
Japan
$51 billion package for new govt spending
Package includes payout to families, tax break on mortgages
South Korea
$25 billion announced till date to ease financial crisis
Taiwan
$30 billion for domestic investment and consumption
Shopping voucher handout about Taiwan dollar 3,600 per citizen
Argentina
President announced $3.7 billion plan to deal with spreading financial crisis.
Source: Agencies
Here’s a look at the specific fire-fighting measures announced by various countries.
United States
President-elect Barack Obama crafting $175 bn package to create 2.5 million jobs
President George Bush signed a $168 bn, 2-yr stimulus into law in early 2008
Package includes tax rebates of up to $600 per individual earning $75,000 gross income
Declared two stimulus packages worth $ 1.5 billion
Financial Package One
Bill to disburse $700 bn in stages
After the first $250 bn is authorised, President could request another $100 bn
Final $350 bn could be cleared by a further act of Congress
Financial Package Two
Fed will purchase up to $600 billion more in mortgage-related assets
Fed will lend up to $200 billion to the holders of securities backed by various types of consumer loans
Fed will buy up to $100 billion in direct obligations from mortgage giants
US Govt Measures
Up to about $1.8 trillion in Fed purchases of top-rated US dollar commercial paper under a facility launched in October
Up to about $1.9 trillion in new Federal Deposit Insurance Corp (FDIC) guarantees for banks
Up to $800 billion in Fed support for mortgage and consumer credit markets
Up to $600 billion in Fed purchases of US dollar commercial paper and certificates of deposit under a Money Market Investor Funding
Up to $900 billion in Fed Term Auction Facility loans was offered to meet financial institutions' cash needs
Unlimited commitments to lend through discount window to banks and broker dealers(totaled $296.82 billion as of Nov. 19)
$700 billion for the Treasury to buy equity stakes in financial institutions
Treasury, the FDIC and the Fed have agreed to shoulder up to $249.3 billion in losses from a Citigroup portfolio
Unlimited temporary Fed currency swap lines with the Central banks, Fed maintains $165 billion in swap lines with other banks
Up to $50 billion from the Great Depression-era Exchange Stabilisation Fund
At least $26.57 billion in Treasury direct purchases of mortgage-backed securities since September
$200 billion to backstop Fannie Mae and Freddie Mac
Up to $144 billion in additional MBS purchases by Fannie Mae and Freddie Mac
AIG will get up to $152.5 billion in support from Treasury equity purchases
$300 billion for the Federal Housing Administration to refinance failing mortgages
$4 billion in grants to local communities to help them buy and repair homes
$29 billion in financing for JPMorgan Chase's government-brokered buyout of Bear Stearns & Co in March.
France
President Sarkozy unveiled a $32.9 billion stimulus plan
Targeting investment projects rather than directly aiding consumer
Measure to boost GDP by 0.6% by 2009
French package will cost 1.3% of GDP, will push budget deficit to 3.9%
Budget deficit will be above the European Union’s 3% limit
EU allowed the exceed budget limits in 2009
United Kingdom
Prepared a $29.06 bn package centering around consumer tax cut
Announced a range of tax cuts and govt spending over 18 months
Package includes 2.5% cut in VAT to 15%, postponement of corporate increase
Package will increase public borrowing to $178.6 bn next year, nearly 8% of Britain’s GDP
Germany
Unveiled plans worth 31 billion euros or 1.25% of GDP
Govt refusing to deliver tax cuts to help stimulate economic growth
Package will generate investments and new contracts worth over 50 billion euros over 2 years
New lending of up to 15 billion euros will be introduced, strengthen its lending activities
Russia
Unveiled $20 billion economic stimulus package
Package includes cut in profit tax to 24% from 20%
Govt sanctioned state-run banks to support industry with billions of dollars of soft lending
European Union
Fiscal boost amounting to 200 billion euros($260 bn), nearly 1.5% of EU’s GDP
EU commission urges member-states to commit 170 billion euros to their own rescue package
Considering system of guarantees and loan subsidies where credit is tight
Aid to SMEs increased to 30 billion euros from 10 billion Euros
China
Introduced stimulus package worth 4 trillion yuan ($586 bn)
Package mainly for govt spending on infra projects and earthquake-related relief work
Stimulus package to boost domestic demand through 2010
VAT rule changes allows companies to deduct the cost of core investment expenses
Govt increased export tax rebates for wide range of products
Australia
More than $ 12 bn for auto industry, family benefit and domestic residential backed mortgage market
Japan
$51 billion package for new govt spending
Package includes payout to families, tax break on mortgages
South Korea
$25 billion announced till date to ease financial crisis
Taiwan
$30 billion for domestic investment and consumption
Shopping voucher handout about Taiwan dollar 3,600 per citizen
Argentina
President announced $3.7 billion plan to deal with spreading financial crisis.
Source: Agencies
Legal firms to make hay in slowdown
Fortunes of domestic law firms will continue to rise on account of spurt in layoffs and commercial disputes, even though the government injected a booster dose of over Rs 30,000 crore to propel growth.
"Workload on disputes pertaining to joint venture terminations, franchising problems and layoffs have increased as companies have started taking pre-emptive actions," said senior partner of the law firm Titus and Co, Diljeet Titus.
Although the government has come out with a fiscal stimulus package to boost industrial growth and economy, it is unlikely to have perceptible impact in the short run and raise business confidence, which has led to layoffs, partial and complete closure of plants and termination of joint ventures, especially those involving foreign partners.
According to Titus, who deals mostly with foreign clients, "Recently, we have received more than two dozen references on joint venture terminations, closure of wholly owned subsidiaries, branch offices and liaison offices."
Company law expert U K Chaudhary said, "We have been approached by some big companies for consultation work on compensation package for the employees to be retrenched."
Several big and small companies battling demand slowdown are trying to get rid of surplus employees to save costs.
"It is true that world is suffering from a severe financial crisis, but for many Indian legal firms, it is a boom time and lawyers across the country are getting a lot of works related to litigation and drafting," opined Rabindra Jhunjhunwala, Partner Khaitan and Co.
According to latest IMF estimates, world economic growth rate is expected to slow down to 2.2 % in 2009. Many countries in the world including the US, Eurozone nations and Japan are in recession. Economic growth rate in India too is expected to moderate to 7 % during 2008-09 from 9 % in the previous fiscal.
Source: Agencies
"Workload on disputes pertaining to joint venture terminations, franchising problems and layoffs have increased as companies have started taking pre-emptive actions," said senior partner of the law firm Titus and Co, Diljeet Titus.
Although the government has come out with a fiscal stimulus package to boost industrial growth and economy, it is unlikely to have perceptible impact in the short run and raise business confidence, which has led to layoffs, partial and complete closure of plants and termination of joint ventures, especially those involving foreign partners.
According to Titus, who deals mostly with foreign clients, "Recently, we have received more than two dozen references on joint venture terminations, closure of wholly owned subsidiaries, branch offices and liaison offices."
Company law expert U K Chaudhary said, "We have been approached by some big companies for consultation work on compensation package for the employees to be retrenched."
Several big and small companies battling demand slowdown are trying to get rid of surplus employees to save costs.
"It is true that world is suffering from a severe financial crisis, but for many Indian legal firms, it is a boom time and lawyers across the country are getting a lot of works related to litigation and drafting," opined Rabindra Jhunjhunwala, Partner Khaitan and Co.
According to latest IMF estimates, world economic growth rate is expected to slow down to 2.2 % in 2009. Many countries in the world including the US, Eurozone nations and Japan are in recession. Economic growth rate in India too is expected to moderate to 7 % during 2008-09 from 9 % in the previous fiscal.
Source: Agencies
Subscribe to:
Posts (Atom)