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View Poll Results: Tata/Mahindra Owners: Did "Patriotism" Play A Role In Your Car Purchasing Decision?
Absolutely! I always believe(d) in buying "Desi" 30 15.87%
Maybe. At a sub-conscious level perhaps. 64 33.86%
No. I bought a Mahindra/Tata because of its qualities. 95 50.26%
Voters: 189. You may not vote on this poll

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Old 1st June 2014, 21:43   #76
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Default Be Indian, Buy ........JLR

A recent message sent to my on Whatsapp inbox got me thinking.

The crux of this message was that Indian currency is weak as we Indians spend lots of money on foreign products. So it urges us to buy Vicco Vajarandti and not Colgate toothpaste, micromax phones and not Samsung/nokia and so on and so forth.

This got me curious about the cars that we buy. Maruti and M&M are surely Indian companies and the money we pay for their cars remains “within the house”. At the other end of the spectrum are imports such as Porche. Rolls etc, where surely the money paid leaves to the parent Company abroad.

Now what about the others? Ford-India, Toyota India, Hyndai-India,Skoda-India, GM-India, Honda-Siel, Bharat Benz to name a few. How does it work with these? As far as I understand, these are Indian subsidiaries, incorporated in India. What happens to the money that we pay them for their cars? Does it remain in the Counrty or does it fill the coffers of the parent company in the Home Country-US, Japan, Korea etc.

In other words, in this day of ‘Flat World’ and multinational companies, what exactly is an Indian company? Should we feel guilty about buying a Honda or a Skoda as it is directly leading to a weakening rupee?
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Old 2nd June 2014, 08:46   #77
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Default Re: Be Indian, Buy ........JLR

All this nonsense is given by those who do not know head or tail of how global economics work.

Even I don't understand much of economics, but I do know the basics. The profit that these companies make may appear huge. However, the money is reinvested again in India in expanding the business (through R&D , exports etc). Moreover, India isn't a country that only imports goods. We as Indians rarely get to find out what exactly India exports!

Cash inflow and outflow balance out themselves, as long as we have a stable government (which, I believe, we have now). So don't worry and buy whatever you feel like!
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Old 2nd June 2014, 09:44   #78
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Default Re: Be Indian, Buy ........JLR

So called Maruti is ~58% Japanese. If you notice carefully it's Maruti Suzuki India Ltd. If they remove the name Maruti, no one will buy their cars!

And even if you buy a Tata which has a 1.3MJD, part of the money would go to Fiat, Italy somehow. I don't know how it works in reality, but that's how it would mostly be.

Last edited by amolbh : 2nd June 2014 at 09:47.
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Old 2nd June 2014, 09:50   #79
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Default Re: Be Indian, Buy ........JLR

We're now in an era where inter-dependency is unavoidable. Some countries may benefit more out of certain outsourcing deals than the others, but that is the way it is. Messages like "be Indian buy Indian" would've been relevant about 30 years ago where consumer durables were manufactured largely by 2-3 Indian companies and there were occasional imports of a Sharp/Sony. Also the FMCG market had some Indian companies dominating back then when HUL was slowly making inroads. Now imagine an Indian household without an HUL product.

Apart from the fact that all these multi-nation companies have infused capital funds into the country, created employment for millions of Indians and also created savings for households by share issue, there is one more factor why people buy non-localised products.. better quality or perception of better quality whichever applicable. India was never the proponents of superior manufacturing processes or checks, we merely borrow from the American/Japanese concepts of TQM, QC and low margin market penetration.

In the end a consumer will always want value, either of self-perceived or by a general benchmark. Value by rule of thumb is quality at an optimal price. Quality would most often mean long lasting/more effective/feel good factor depending on product. By general experience, Indian companies aren't the leaders in this regard. It's an interconnected world now, India is ancillary to other countries and vice versa and no pro-country logic can work anymore thanks to share markets and employment. Instead let the consumers buy any brand they like for whatever reason as long as they're convinced.
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Old 2nd June 2014, 09:54   #80
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Default Re: Be Indian, Buy ........JLR

How to measure Globalization in Auto industry?

Simple -We drive the current generation of automobiles due to this. Even the 100% Indian companies have to benchmark with respect to the best in class with respect to competition or else they would perish.

Customer can choose based on this buying power the Car he needs.

By Globalization, developing countries like INDIA is benefited resulting in increase employment, motivation toward education, growth in economy, better standard of living, etc
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Old 2nd June 2014, 10:13   #81
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Default Re: Be Indian, Buy ........JLR

I don't know economics but I do understand that if you follow this message, life as you know it would stop.

90% of the things you buy/spend on has some foreign link or the other. The computer you are using today to spread this message has one since its either Windows OS or Mac. If its your mobile then its Android (Google) or Apple Ios. Forget all that, maybe 90% % of us working in Multinationals. I work for one. It pays me for me and my family's livelihood. If they did not invest in us we would be no where.

Most important for us. Should we stop buying petroleum then ??

The reason is not globalization. Its corruption, the lackadaisical nature of the politicians and bureaucrats. That's what need to be addressed. Instead there are people who look for excuses

Last edited by Altocumulus : 2nd June 2014 at 10:19.
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Old 2nd June 2014, 10:14   #82
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Default Re: Be Indian, Buy ........JLR

If these euro, japanese and korean car companies indigenize and incorporate more parts from Indian vendors then net-net there is not much an issue, and they would repatriate only profits or royalty to their parents. But if there is high component of foreign components in these cars then net outflow out of India would be correspondingly high.

But another fact also is that if these MNC companies were not here, then Tata would have not released the Bolt, Zest (no need to) and Bajaj would still be rolling out its tuk-tuks and chetaks.
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Old 2nd June 2014, 10:31   #83
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Default Re: Be Indian, Buy ........JLR

Quote:
Originally Posted by docsr View Post
This got me curious about the cars that we buy. Maruti and M&M are surely Indian companies and the money we pay for their cars remains “within the house”. At the other end of the spectrum are imports such as Porche. Rolls etc, where surely the money paid leaves to the parent Company abroad.
We cannot decide or ascertain with total surety that the money we pay to M&M or Maruti is totally used by them over here in India. The money could be used for importing technologies and material for car's manufacturing.

Quote:
Now what about the others? Ford-India, Toyota India, Hyndai-India,Skoda-India, GM-India, Honda-Siel, Bharat Benz to name a few. How does it work with these? As far as I understand, these are Indian subsidiaries, incorporated in India. What happens to the money that we pay them for their cars? Does it remain in the Counrty or does it fill the coffers of the parent company in the Home Country-US, Japan, Korea etc.
See, the above mentioned brands have their manufacturing plants in India so a major sum of revenue is further allocated towards R&D and it is used in activities relating to expansion of the brand within the country itself because they treat India as a viable market. However, after allocation of the revenue under the defined heads the surplus (if any) is seen as profit and it is probably provided to the parent company after all the parent brand has invested in the country so it has all the right to earn from here.

Quote:
In other words, in this day of ‘Flat World’ and multinational companies, what exactly is an Indian company? Should we feel guilty about buying a Honda or a Skoda as it is directly leading to a weakening rupee?
In today's time labeling a car brand as Indian is difficult due to influx of foreign entities which have collaborated with Indian brands to explore new markets and make more refined products by employing new and informed talent. Now, Deciding the brand which one want's to buy is a matter of taste which is developed by the availability of "much-needed resources". Benz, Audi and BMW have rolled out models which are well within the reach of the Indian customers so that's why people today are more inclined on buying the foreign vehicles over here.

Economically, Buying imported vehicles can not be termed as a major criteria of rupee's downfall.

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Old 2nd June 2014, 10:57   #84
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Default Re: Be Indian, Buy ........JLR

Quote:
Originally Posted by rohanjf View Post
All this nonsense is given by those who do not know head or tail of how global economics work.

Even I don't understand much of economics, but I do know the basics. The profit that these companies make may appear huge. However, the money is reinvested again in India in expanding the business (through R&D , exports etc). Moreover, India isn't a country that only imports goods. We as Indians rarely get to find out what exactly India exports!

Cash inflow and outflow balance out themselves, as long as we have a stable government (which, I believe, we have now). So don't worry and buy whatever you feel like!
Not really.
A global MNC in India is a company registered in India having almost full ownership by the parent/principal or whatever you may label it.
This company has a job to make profits (that's why the parent co invested in India, no one is here for charity). So what happens when this company makes profits? The co. can declare dividend,and guess where all this money flows (who has the 100% ownership?)?

You are right there is a lot of reinvestment that takes place in expansion of facility, increase of salaries, increased R&D etc. (As you may note, this also improves the employment scene). But if the reinvestment rate > profits turned over to the parent co. it makes zero sense unless there is a strategic intent (capture the market today, and India is a growing economy, so tomorrow when Indian are far richer, then I will make money etc). But the truth is there is some money that does go abroad.

However, don't think only in terms of Automobile companies. There are sectors where items are just imported (perhaps from China/Taiwan) and sold here. No reinvestment to increase capacities, no salaries for Indians, no R&D in India. Similarly the agricultural produce from abroad.

As it is, we have meager oil & gas resources, but our burgeoning population places huge energy demands. This means that we NEED to buy oil & gas from abroad. Now if the person abroad has low needs for Indian goods and services, we are screwed! The demand for our currency goes down and we see it as rising dollar against rupee.

So where exactly does India excel in exports?
1. Services: Like IT, BPO, KPO etc
2. Products: like Jewellery, textiles, automobiles (so the same guy who sent money abroad also being in some money ;-)), iron ore, coal, pharmaceuticals, agricultural produce etc
http://upload.wikimedia.org/wikipedi...ia_treemap.png

To be honest, the income from these exports has NEVER been higher than the expenses of imports. Which means our currency always slips down in the global market (demand of INR is far lesser than the supply of INR).

Oh but then how do we survive? By raising debt to finance all our "aiyyashis" or extravagance. Quite like US.
http://upload.wikimedia.org/wikipedi...nt_Balance.png

Of course economics say that all this is good, because instead of being swadeshi and (perhaps) being inefficient, you open the markets and use the most efficiently produces item/service sourced from anywhere in the globe.
But the truth of the matter is that it pinches us currently.
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Old 2nd June 2014, 11:24   #85
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Default Re: Be Indian, Buy ........JLR

If one were to think like that, almost all good brands - whatever the sector - are foreign. One would be unable to buy almost anything of quality if we were to buy only Indian.
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Old 2nd June 2014, 12:44   #86
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Default Re: Be Indian, Buy ........JLR

That Whatsapp where you got the message is also phoren! If we staunchly stuck to all things Indian, then we would be still driving that old Amby(which itself was phoren),padmini, safari, bolero and the likes.
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Old 2nd June 2014, 13:40   #87
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Default Re: Be Indian, Buy ........JLR

Quote:
Originally Posted by docsr View Post
The crux of this message was that Indian currency is weak as we Indians spend lots of money on foreign products. So it urges us to buy Vicco Vajarandti and not Colgate toothpaste, micromax phones and not Samsung/nokia and so on and so forth.
Increasing, many home grown brands have stopped manufacturing their products in India due to high labor cost and rigid laws.

They just import their stuff from China and do the labeling and packaging in their warehouses and sell it in the open market.
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Old 2nd June 2014, 23:08   #88
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Default Re: Tata / Mahindra Car Owners: Did "Patriotism" play a role in your buying decision?

The only patriotism that counts, pun intended, is the full and completely honest payment of taxes, whether direct or indirect, irrespective of whether even one other 'citizen' is also doing so!

How many owners and buyers of expensive four-wheelers in this country (i'd say anything that's over 4m long, and has a petrol engine size of 1.2l and a diesel engine size of 1.5l, to take one plausible, readymade criteria) can say that, i wonder?

How much are car sales and car dealers a function of black, black money, I wonder, every time I curse the quality of roads or traffic policing or the parking chaos/mafia etc?! Or the next time I am bossed on the road by the expensive brawn of an SUV, whether it's a Tata, a Mahindra or a T-Fort.

If you do that, patriotism has little meaning, in fact it gets debased, in a consumer(ist) context like car-buying. Which is also why I at least am dead against associating the Indian flag and national anthem with the shallow, tawdry audio-visual spectacles that are the commercial h/b-ollywood films in multiplexes.

Please do not construe this as holy posturing, this is the minimum expected of citizens in Europe, the US, Singapore, Japan, Taiwan and Korea.
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Old 3rd June 2014, 01:44   #89
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The Indian industry has kept the foreign competitors honest and forced them to up their game and cut costs.

Instead of flooding India with previous generation products at exorbitant prices we get current technology with enough localisation to have a comfortable ownership experience.

Look at the motorcycle industry, the Indian competition has made Honda, Yamaha and Suzuki come up with compelling products at lower costs.

Patriotism did play some role in my dad purchasing a diesel Tata Indigo instead of a petrol Hyundai accent.

Last edited by moralfibre : 3rd June 2014 at 09:47. Reason: Removing quote
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Old 11th June 2014, 00:03   #90
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Default Re: Tata / Mahindra Car Owners: Did "Patriotism" play a role in your buying decision?

I'm a Rajiv Dixit fan, and I'm extremely inclined to buy Indian made products.

To me, its extremely important that Indian Tech is used for the stuff I buy. My next car is most probably a Nano & a Xylo.

IMO Theres NO end to this debate, so I guess I won't be explaining reasons or clarifying to any questions.

Regards.
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