Tata Steel has said that, despite a tough year for the automobile sector, fiscal year 2014 saw sales of its special grade vehicle steel jump 15%.
Tata, counted among the top 10 global steel producers, in a publication said that despite a negative growth of 16% and 5% in commercial vehicles and passenger cars respectively, it could achieve growth in automative sales mainly on the back of replacing imports, Press Trust of India (PTI) reported.
"Despite this dismal growth, Tata Steel automotive sales could register a growth of 15% in FY 14 over FY 13, primarily by replacing imports and weaning away share from competition, supported by additional volumes from its newly commissioned TSCR (thin slab casting & rolling) line," the company's vice president, steel, marketing & sales, Peeyush Gupta said in the newsletter.
Gupta said "the major steel consuming commercial vehicles (CV) segment will bounce back as the new government provides growth impetus to the economy."
Car manufacturers are also bracing for growth by launching new variants/models and taking advantage of government-aided schemes on excise duty cuts, he said.
"Thus, we anticipate the automotive sector to show a growth of 3-4% in the coming fiscal [year] and a further improved forecast for FY16," Gupta added.
One distinct feature of Tata Steel's approach to serve the automotive segment has been to migrate towards high-end products (essentially imports substitution and of higher value).
In fiscal 2014, Tata Steel achieved its best ever high-end sales (comprising skin panel) of 226kt (kilo tonnes), passing the previous best of 192 kt achieved in fiscal 2013. In fiscal 2015, according to the newsletter, the company intends to offer automotive customers a wider product range from TSCR.
"We have also made plans to ensure a smooth transition to JCAPCPL (Jamshedpur Continuous Annealing & Processing Company) products from the CR annealed range which will be produced by the continuous annealing line in a JV with Nippon Steel Sumitomo Metals Corporation."