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Old 23rd July 2013, 17:51   #16
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Default Re: Why is Ford's resale value poor?

That's why many people account for 'Resale value' of that model even during buying a new car !

Basically resale depends on a variety of factors - some characteristic some inherited.
So under characteristic comes the parameters like "Gas Guzzler" "Expensive Maintenance" etc they are labelled during the initial periods of a car model's lifecycle.

Inherited can be factors like "Facelift around the corner" , "Sudden drop in price of the model" "Soon to Discontinue / Discontinued" . These happen all of a sudden. People who are unlucky just happen to sell car during this time and get hit in resale !

Let me narrate a few episodes;

2009 i10 1.2 Magna (8.5k on the Odo / 11 months old)
Price Brought: 4.25 L
Accessories: 60k
Price Sold: 3.75L
VFM Rating: Below Average
Reason: Facelifted i10 was just out ! + Dealer Transaction


2007 Swift 1.3 Vxi Petrol (28k on the Odo / 5 Years old)
Price Brought: 5.05 L
Accessories: 50k
Price Sold: 3.5L
VFM Rating: Above Average
Reason: Swift's Image + Direct Transaction with Buyer (No Dealer Involved)


2012 Verito 1.5 Dci Executive Edition (16k on the Odo / 1 Year old)
Price Brought: 8.04 L
Accessories: 16k
Price Sold: 5.65L
VFM Rating: Average
Reason: Verito never had great resale + Facelifted Verito was on cards + Dealer Transaction
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Old 23rd July 2013, 18:05   #17
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Default Re: Why is Ford's resale value poor?

Two key factors for resale value:

1. Model popularity - The more successful a model, the higher its % resale value
2. Brand perception - Perception of the brand w.r.t. long-term reliability and peace of mind in ownership

A typical Ford would invariably have a lower resale vis-a-vis a typical Maruti/Toyota as the latter have significantly better brand perception.
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Old 23rd July 2013, 18:09   #18
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Default Re: Why is Ford's resale value poor?

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Originally Posted by anachronix View Post
I had an 2004 Ikon 1.6 SXi which had 7K on the odo when I bought it for 4.1 Lakhs in 2005, sold it with 97K on the odo in 2009 for 1.8 Lakhs. The car also met with a minor accident while it served me. It was a fair deal for me, may be I was too lucky
Similar case for me as well. I put my 2003 December Ikon 1.6 ZXI NXT on Team-bhp classifieds (around mid 2011). It had done around 45000 kms then, and the asking price mentioned was 2.25 lakhs. I had a couple of serious buyers contacting me, and was trying to negotiate for around 2 lakhs. Hearing that I had put up the car for sale, my BIL expressed interest and eventually bought it for 1.75 lakhs (in-family discount ). Earlier this year he relocated to Sydney and during my last visit to India in January, we sold it to someone in Kochi for 1.25 lakhs (67000 kms). This guy was someone who work in the middleeast, and wanted a fun car to drive during his visits home. Not bad for a 10 year old Ford. Probably we were lucky to get someone who actually bought the car for its strengths.

On a side note, when my BIL took the Ikon from me in 2011, he sold his 2005 model Accent petrol for just 90K!
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Old 23rd July 2013, 18:43   #19
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Default Re: Why is Ford's resale value poor?

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Originally Posted by stormerider View Post
This actually is true. My swift went for 3.8lacs (4.5yrs 90k kms) whereas my brothers Safari isn't getting that much! and I don't even think that my fiesta would get that much!?!
======
And above all I find ford cars to be more reliable than any other brands that I have mentioned. No niggles, nothing in my ownership.
+1 to that. My fiesta has 58K on the odo and the ownership experience has been more than satisfying with only one breakdown that was because an independent garage used a non OEM clutch cylinder. Apart from that the car runs flawlessly without asking for even a single rupee on maintenance apart from the regular service.
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Old 23rd July 2013, 19:00   #20
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Default Re: Why is Ford's resale value poor?

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Originally Posted by stormerider View Post

I differ with you on this one. Ford's after sales has been the best for me till date. Comparing it to the After sales of Maruti, Tata, Hyundai, Skoda, Mahindra. The service guys have always paid attention to the problems I might have and rectified and helped in every manner. Warranty issues never cropped up. And service costs of my fiesta have always been lower if compared to my Swift.
Though there's one thing peculiar to ford which I didn't find anywhere else. They did a suspension overhaul at 70k kms as part of scheduled maintenance, though my suspension parts would have lasted maybe another5k kms.
And above all I find ford cars to be more reliable than any other brands that I have mentioned. No niggles, nothing in my ownership.
+1. I totally agree. My 6 year ownership of the Ikon Flair 1.3 has been hassle-free. The car was always taken to ASS and apart from regular service, nothing much was done. Everything's still working fine. I bought it in Sep 2006 for 5.8L OTR and sold to my Brother-In law (he always loved it) for 1.5L when i moved to South Africa earlier this year.

IMO, the perception is the biggest factor to decide the market value of a perticular car.

OT: i would rather have a low resale value, fun-to-drive car for 5-6 years than a "dull" high resale value car.

Last edited by kopakabana : 23rd July 2013 at 19:01. Reason: typo
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Old 23rd July 2013, 20:28   #21
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Default Re: Why is Ford's resale value poor?

Hi,

After maintaining a Ford IKON 1.6 Zxi for 7.5 years(1999-2007), I can say that the costs were not exorbitant as it was made out when I purchased it. I was vehemently opposed by my friends to buy an Ikon but rather go for an Accent(very popular then). ASC was very well equipped and responsive(seen three states Ford ASC's) and better than Maruti, M&M etc

Ford had built a reputation in India(and elsewhere, as well) with Mondeo & Escort models getting bombed due to the maintenance costs(all parts imported!). We are a cost conscious country and hence the brand image of Ford has been dented for long. However, if you actually compare the running costs between a Ford Ikon and a Hyundai Accent for 5-7 years, I might not be wrong to say that both get evened out. Ikon might provide a better value to drive than accent, as Ikon is truely a delight to drive.

Ford definitely is changing its priorities in last 4-5 years in US as well other countries with 'Reliability' coming on to top! I now drive a Ford Explorer(2012 make) and can tell you the difference in the fit, finish, MPG etc versus the earlier cars. Ford seems to be competing with Japanese car makers for long term sustenance.

Last edited by getsurya : 23rd July 2013 at 20:30.
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Old 23rd July 2013, 20:31   #22
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Default Re: Why is Ford's resale value poor?

Quote:
Originally Posted by GTO View Post
Witnessed this first-hand.

Sold my March 2003 Honda City Vtec for 3.5 lakhs.

My brother's late model 2005 Ford Ikon 1.6 with 20,000 lesser kms, one owner (Vtec had two), original paint (Vtec had an overcoat) and Ford dealer service history (Vtec used an independent garage) refused to move off the block. Finally went for Rs. 1.2 lakhs.

I am selling the Alto, which is about 9 years old and getting about 80k for that. Plus the loyalty bonus and all the add ons.

The ford ikon on the other hand, no buyers till now...

GTO, in your opinion, you reckon one should consider the ford badge before buying a ecoSport?
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Old 24th July 2013, 11:10   #23
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Default Re: Why is Ford's resale value poor?

Re-sale value depends on reliability. How many 10+ year old (100000+kms) Fords have you seen on the road? Now compare that to the Hondas & Toyotas. And this perception is more or less global.

I think the root of the problem is that Americans don't or didn't seem to think anyone would keep the same car for more than a few years (disposable everything). So there cars are kind of built 'disposable'. Which is probably why recession hit them (American auto) the biggest.
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Old 24th July 2013, 12:10   #24
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Default Re: Why is Ford's resale value poor?

Quote:
Originally Posted by asr245 View Post
Re-sale value depends on reliability. How many 10+ year old (100000+kms) Fords have you seen on the road? Now compare that to the Hondas & Toyotas. And this perception is more or less global.

I think the root of the problem is that Americans don't or didn't seem to think anyone would keep the same car for more than a few years (disposable everything). So there cars are kind of built 'disposable'. Which is probably why recession hit them (American auto) the biggest.
My experience with Fords (I have a 2003 Ikon & a 2005 Fusion) leads me to disavow the assertion that Fords are not reliable / durable. Both cars are of course extremely responsive and good fun to drive, and have sustained this element consistently through my period of ownership - not a single complaint on this aspect. The body work too is fairly robust; only now, after 118 months of driving it, has the Ikon begun emitting a creak from the rear and I understand this is on account of the rear parcel tray. The interiors on both vehicles have held up splendidly, nothing fancy, but solid and durable. I may be biased to some extent given that I absolutely adore both these cars but haven't strayed from facts.

As you said, some Americans MAY have a tendency to 'dispose' things, but then again, the used car market is huge there as well, with a used car:new car sales ratio estimated to be 3:1. What this implies is clearly that in no way does the selling of a car equate to its end of life; on the contrary, it finds its way to someone who has a different means & requirement equation. Another way to look at this is to see the proliferation of leasing schemes at an individual level (in India, it's only at through corporates) and the cost of an average car as a % of someone's annual income - all these are motivators for a car change after a relatively shorter ownership period.
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Old 24th July 2013, 12:34   #25
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Default Re: Why is Ford's resale value poor?

Resale value stems prominently from market emotion - determined by various historic factors such as the manufacturer's stability, perceived ease/cost of ownership etc. Typically, manufacturers/cars that are said to have better resale value tend to score high on a majority of these criteria, compared to those with lower resale -which would have struck out on more than one of parameters in the public's opinion.

Extending this concept to Ford's apparent lower resale, one possible reason - regardless of merit, might be due to its perceived higher spares cost.

Last edited by theMAG : 24th July 2013 at 12:35.
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Old 24th July 2013, 12:45   #26
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Default Re: Why is Ford's resale value poor?

One should also consider into this equation, the segment buying a used car.

For a used Ikon or Fiesta having sub 4L budget, we can safely assume predominant number of buyers belonging to lower middle class or middle class families. Of course I'm ignoring exceptions such as multiple cars in the family, or informed buyers, because they are still minisculine.

Any such individual is already investing a considerable sum (by their estimate/spending power) on buying a car. The last thing they want is expensive repairs and spares. Also, a significant amount of these buyers belong to small towns and (recently) villages. Ease of service is a significant factor, they do not have the luxury of running to the authorised dealer for every single issue.

To top it all, they are almost always advised by 'experts' who are mostly relatives or road side mechanics, who tell them to just shut their eyes and buy a Maruti, worst case Hyundai but nothing else. On any given day, a Swift or an Alto is not the pinnacle of automobile engineering it's resale value will lead you to believe.

Consequently, more than which car to buy, Ford and Fiat have ended up in the category of "don't touch with a barge pole" cars. It's obvious that reslae will tank if majority of user car purchasing public will not go near them no matter how good the condition.

And as informed people, this skew in a way works to our advantage if we are willing to bet our money on such models. Up north, Punto/Linea/Ikon/Fiesta are available for mouth watering prices, so much that you are left wondering if there is something wrong with the car being sold!

Last edited by avisidhu : 24th July 2013 at 12:46.
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Old 24th July 2013, 12:47   #27
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Default Re: Why is Ford's resale value poor?

The resale value is primarily dependent on whether the model of the vehicle was a success or failure and the after sales service (reliability, spare parts availability, cost, distribution network and competency). Fuel efficiency is also an important parameter in the Indian context. Maruti has got the after sales service and fuel efficiency right. Toyota has an image of being reliable. Only an enthusiast knows and cares about the dynamics and performance.

I think ford mainly loses on the after sales service factor compared to Maruti/ Hyundai. If the vehicle has not sold much, it makes the matter worse.

I own a Getz from Hyundai and I find that the resale value is less compared to Santro or i20. Even though the model is not in production, Hyundai procures the parts in a few days if it is unavailable at the service center.

Last edited by PatienceWins : 24th July 2013 at 12:55.
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Old 24th July 2013, 12:48   #28
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Default Re: Why is Ford's resale value poor?

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Originally Posted by asr245 View Post
Re-sale value depends on reliability. How many 10+ year old (100000+kms) Fords have you seen on the road?
Lots and lots. There has been nothing like a 'failure engine' from Ford. Be it the ROCAM, TDCi or duratec.

Quote:
Which is probably why recession hit them (American auto) the biggest.
Ford India(except the Endeavour) is more European than American in it's characteristics, reliability and durability.
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Old 24th July 2013, 14:40   #29
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Default Re: Why is Ford's resale value poor?

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Lots and lots. There has been nothing like a 'failure engine' from Ford. Be it the ROCAM, TDCi or duratec.


Ford India(except the Endeavour) is more European than American in it's characteristics, reliability and durability.
Where was I talking about 'failure engine'? And also I was talking about Ford US, not Ford India. But the feeling that Honda/Toyota are more reliable than Ford is global and hence, globally their resale value is also higher.

My dad has a 2001 OHC VTEC with almost 200000 kms on it. It's let him down twice - once he forgot to switch off the lights and the battery died, the other time (few months ago) the clutch cable broke. It's not in a good shape now but nothing a good (& probably expensive as some parts would be changed) service won't be able to solve.

As I said before, one needs to look as to how many such cars one sees on road.
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Old 24th July 2013, 14:53   #30
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Default Re: Why is Ford's resale value poor?

Few reasons for the low resale value for FORD's

1. Low brand Recall
2. High cost of ownership
3. Mediocre service experiences
4. High cost of the vehicles itself
5. Mixed ownership experiences
6. Unavailability of Spare parts in the open market
7. Ignorance in market development by the Ford company
8. Mediocre product mix
9. Slow sales and service point expansion
10.Mistake in evaluation of Indian market
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