Southern Motors wants a whopping 3% to cancel booking of a Mitsubishi Cedia!

[sriramv.iyer]

Friends:
One of my close friends booked a Mitsubishi Cedia Sports by paying 2L. He got another car through his contacts, and when he approached the Mitsubishi showroom, he was told that the cancellation charges are 3% of the ex-showroom price!!!! Approx 33,000 Rs.

The sales guy told him that my friend had visited the showroom quite a few times (I think he did visit the showroom exactly 3 times, and the sales guy brought home the car once).

It was not as if he wanted to cheat the dealership. He had even applied for a Bank Loan in SBI for the car, and the dealership knows this.

There is nothing written about this 3% reduction in the receipt or any document received from Mitsubishi.

Is this legal? (I don't think so!) - We are planning to meet the dealership tomorrow. Please let us know if there are any legal clauses that would help us in the discussion. Thanks!

[rjstyles69]

You said everything about your friends experience, the priceless question is " which dealership" ? Once again please be advised never pay more than 10k or so as the initial booking amount for a car.

[narayan]

Originally Posted by sriramv.iyer

There is nothing written about this 3% reduction in the receipt or any document received from Mitsubishi.

Is this legal? (I don't think so!) - We are planning to meet the dealership tomorrow. Please let us know if there are any legal clauses that would help us in the discussion. Thanks!

dont go into the legalities. that wont take u anywhere in this situation. the receipt might have had a "conditions apply " word and the detailed conditions doc mite have this clause and so u can still dispute that

but it wont help closing the matter.

better to take a friendly approach and get ur money back with minimum loss.
if ur buying another mitsubishi - maybe the company can help you but if not, best to use some polite words and maybe mention how u cud post a nice experience in a online forum which will help the dealership also gain some reputation

[Willeys78]

this 3% what they are telling is exorbitant. too much, that only i could say. they are trying to rip off your friend. start with a friendly approach, try to make the damage minimal, but if no way, tell them there are online blogs and you will put your experience about the dealership that will bring their bad practice to public view. Secondly shoot a mail to anybody who is in a strategic position in sales/marketing in Mitsubishi motors and state all genuine reasons for the cancellation of booking. Since the company is not doing in great volumes and they seems like trying to promote their new cedia more, they may not be interested in creating any controversies or bad reputation. Anyway it is your friend's hard earned money! don't simply gave up and loose money. 33k is not small amount. Maximum up to 10k is ok. 10k is what ford dealership deducts, when i enquired about the same. In my experience once i had to cancel my booking for a hyundai santro and they deducted nothing. but got the cheque only after 2-3 visits to dealership and 3 weeks waiting. it was a headache.

[ajmat]

Well, you made a contract to buy the car, since it was cancelled due to no fault of the dealer, he is entitled to some compensation for the cost of buying and holding the car

[sriramv.iyer]

Originally Posted by Willeys78

this 3% what they are telling is exorbitant. too much, that only i could say.
...
Anyway it is your friend's hard earned money! don't simply gave up and loose money. 33k is not small amount. Maximum up to 10k is ok.

AFAIK, usually no one deducts the money. Probably 1 or 2K max (Hyundai deducts 2K and they tell that while taking the booking amount. I agree with you! 33K is a lot of hard earned money for my friend!

Originally Posted by narayan

better to take a friendly approach and get ur money back with minimum loss.

Agree with you on this! We'll first start with a friendly approach only. I don't believe fighting takes us anywhere.

Originally Posted by rjstyles69

You said everything about your friends experience, the priceless question is " which dealership" ? Once again please be advised never pay more than 10k or so as the initial booking amount for a car.

I agree with you that we shouldn't have paid that much for booking. But, Mitsu asked for some commitment, and asked us to pay that 2L. My friend was pretty sure on picking up the Cedia. That's why he paid that amount.

Originally Posted by ajmat

Well, you made a contract to buy the car, since it was cancelled due to no fault of the dealer, he is entitled to some compensation for the cost of buying and holding the car

Dealer is entitled to some compensation. But not 3% of the ex-showroom price! This is a rip-off! AFAIK, we can cancel a booking anytime before the car is registered with a little or no penalties.

[CBlazer]

How long ago was this? I'm sure he can find another buyer. Although the penalty is big, the issue might be that their cars are built only when orders are placed. Or at least that's what I've heard about Mitsu cars.

The fact that your friend paid 2L shows he was serious about the purchase. Yes, the dealer must have told you upfront as to what the cancellation amount was. But I would suggest that you don't get into legalities in this matter. Try to work out a compromise.

I suggest that your friend get it over with ASAP and start enjoying his new car.

[balajird]

Dude, could you please mention which other car your friend has purchased, as others have mentioned, if its another Mitsubishi, it might help you. Also, you didnt mention why he took "another car from his contacts" rather than from the dealer?

[sriramv.iyer]

Originally Posted by CBlazer

How long ago was this? I'm sure he can find another buyer. Although the penalty is big, the issue might be that their cars are built only when orders are placed. Or at least that's what I've heard about Mitsu cars.
...
I suggest that your friend get it over with ASAP and start enjoying his new car.

It was a car that was already available - They were trying to sell that off. It was the last car of the previous model (without stickers). As you said, we'll try and workout a compromise. My friend is quite upset with the turn of events! I really want him to resolve this issue so that he starts enjoying his other car

Originally Posted by balajird

Dude, could you please mention which other car your friend has purchased, as others have mentioned, if its another Mitsubishi, it might help you. Also, you didnt mention why he took "another car from his contacts" rather than from the dealer?

It was a Honda Accord from his contacts (not a mitsu). The turn of events was sudden - He did not have this option when he booked the Cedia, and as I mentioned, he even applied for the SBI car loan!

[gpa]

Sorry to hear about this incident that happened to your friend. Which is this dealer is this in Bangalore? 3% of ex-showroom price is way too high to be charging for a cancellation of a booking. Try working out a compromise with the dealer. Considering the tough times at the moment, I am sure, he will be willing to work something out.

[windsurfer]

A Maruti Dealer in Hyderabad quoted me 5k for cancellation for the full amount paid for the Alto top end. 3% is too much.

[anujmishra]

Originally Posted by windsurfer

A Maruti Dealer in Hyderabad quoted me 5k for cancellation for the full amount paid for the Alto top end. 3% is too much.

Case of Maruti and Mitshubishi are different. Maruti Showroom can shell Alto in no time and he will gain 5K as bonus. But in case of Mitsubishi Cedia, it is not fast moving car. If he registered car from factory he has to bear with it until he finds another owner looking for same trim.

This price can be negotiated further but I would not feel they will come down till 5K. Just my 2 cents. Best of luck anyways.

[bblost]

Originally Posted by windsurfer

A Maruti Dealer in Hyderabad quoted me 5k for cancellation for the full amount paid for the Alto top end. 3% is too much.

I am not debating the legality or correctness of the cancellation charges.

But this is interesting.

Alto is India's most popular and fast selling car.
Alto Lxi, ex showroom Delhi = 3,00,000
Cancellation charges = 5,000

i.e. 1.67%

The Mitsu dealer is asking 3%.
Cedia, I think it sells the same number of cars in a year as Alto's in a month.
And I have a feeling that I am being optimistic.

I repeat GTO's point, never give a large sum of money as booking amount.
Money is power. Your friend gave the dealer the power to dictate terms.

[GTO]

Absolute nonsense. They cannot hold back 3% of the booking amount, UNLESS it was mentioned in the contract. If not, you are entitled to a full refund. Heck, if anything, they should pay you interest since the dealership held your money for an x amount of time. It's not like the Cedia is a built-to-order car that they have specially arranged for your friend.

Mitsubishi is doing terribly in India and such anti-customer policies are the last thing that they need.

You need to name the dealership and send a link of this thread to HM-Mitsubishi as well as the dealer. Wait & watch.

[CBlazer]

Originally Posted by sriramv.iyer

It was a car that was already available - They were trying to sell that off.

Ok. If it was already available, it was probably booked by someone else and later canceled. In that case it is not at all fair to charge 3% - they're obviously trying to make some money out of this. Nevertheless, work out a compromise and get out of it.