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Old 20th June 2014, 12:42   #46
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Default Re: Safety Features - Myths on costs debunked

I do not think a pair of airbags with their assorted circuitry costs a lot. I checked the Scorpio prices (the only manufacturer who has same model with and without airbags) and the difference is around Rs.20K. That makes it 10k/airbag.

Unless the accident has messed up the mechanicals, there is no need to change the steering column or the wiring harness or any thing other than the airbag module. It is sheer greed and/or lazy thinking that prompts the A.S.S. to change as many things as they can to inflate the repair bill.
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Old 20th June 2014, 12:47   #47
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Default Re: Safety Features - Myths on costs debunked

Quote:
Originally Posted by Aroy View Post
I do not think a pair of airbags with their assorted circuitry costs a lot. I checked the Scorpio prices (the only manufacturer who has same model with and without airbags) and the difference is around Rs.20K. That makes it 10k/airbag.
Liva also has safety package for 20,000
If you talk about pricing we can safely assume that cost to company is in the ballpark of 8000-9000 max
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Old 22nd June 2014, 17:23   #48
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Default Sorry to go a bit OT

Quote:
Originally Posted by pacman2881 View Post
Shocking to the say the least. If we also consider the poor part quality and finish of cars made for India, these companies are making windfall gains here.
Poor quality & components wrt to their foreign (own) set-up.

Customer awareness is low. These things keep happening Scam (SCAM Alert "Saar, your car needs a clutch overhaul")And IIRC, few dealerships & SVC's used to call customers stating that the service interval is more frequent, like 5,000 kms instead of 10,000 Here (Dealer SCAM : Service the car *more frequently* than required!)

And often do you hear someone at the SVC screaming - Sue you in the court and even if you somehow do, you might end up like this

So, they have a ball & earn $$$
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Old 22nd June 2014, 23:54   #49
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Default Re: Safety Features - Myths on costs debunked

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Originally Posted by alavandar View Post
I look forward to see break up costs for DZire as well as other makes from you . Regds.
Here you go, I got them for the SX4 since I had the parts catalogue to get the list of parts related to the airbags:
1. Drivers side A/B module - Rs. 5358
2. Passengers side A/B module - Rs. 6056
3. Airbag control module + main harness - Rs. 4048
4. Passenger airbag harness - Rs. 1627
5. Airbag sensor + harness - Rs. 3076

Total cost: Rs. 20165

Add one days labour at Rs. 3k for replacing stuff and still you will end up with sub 25k figure for replacement if the entire system was stripped out and new parts fitted. For the i20 too it was around 45k IIRC when I spoke to that guy in carwale. And, there was a wagonR with ABS+Dual airbags for 40k more than the normal variant. Now they removed one airbag and the difference is 30k. Hence, since they are giving the balloon that explodes during a crash like any other manufacturers, I will term this as a good pricing. Whether people brought it thats another point that is out of this thread's context

I guess its more of jumping the gun early compared to lack of comprehending the posts. For example, I wouldnt have jumped in if you had posted the actual costs of replacement Just because there was wrong figures posted I wanted to clarify. Regarding ripping off or not ripping off, I am with TSK in that regard.

Last edited by audioholic : 23rd June 2014 at 00:04.
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Old 23rd June 2014, 00:09   #50
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Default Re: Safety Features - Myths on costs debunked

Quote:
Originally Posted by audioholic View Post
Here you go, I got them for the SX4 since I had the parts catalogue to get the list of parts related to the airbags:
1. Drivers side A/B module - Rs. 5358
2. Passengers side A/B module - Rs. 6056
3. Airbag control module + main harness - Rs. 4048
4. Passenger airbag harness - Rs. 1627
5. Airbag sensor + harness - Rs. 3076

Total cost: Rs. 20165

Add one days labour at Rs. 3k for replacing stuff and still you will end up with sub 25k figure for replacement if the entire system was stripped out and new parts fitted. For the i20 too it was around 45k IIRC when I spoke to that guy in carwale.

I guess its more of jumping the gun early compared to lack of comprehending the posts. For example, I wouldnt have jumped in if you had posted the actual costs of replacement Just because there was wrong figures posted I wanted to clarify. Regarding ripping off or not ripping off, I am with TSK in that regard.
Thanks, now we are talking something objective. I hope you can support with copies of BOM/ price list like I have done.

You calling it with supporting details is better than an off the cuff remark of making statements like "day light robbery".

I hope you will add to everyone's knowledge if you can dig out the prices for other makes / models.

As regards posting of wrong figures, you have not proved that all figures are wrong. And also, I have not invented these figures and they are all in various posts and links for all to see. You can also see the posts of i20 guy

Last edited by alavandar : 23rd June 2014 at 00:11. Reason: Spellings and clarity
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Old 23rd June 2014, 00:12   #51
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Default Re: Safety Features - Myths on costs debunked

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Originally Posted by alavandar View Post
Thanks, now we are talking something objective. I hope you can support with copies of BOM/ price list like I have done.

D
You can verify the costs from the spare parts price thread on TBHP itself which has the entire spreadsheet of prices for MSIL. Just search for airbag and you will get the required costs. You can also see the huge difference between localised and non localised parts. I have the latest version of the same spreadsheet and the prices are still the same, maybe off by 2% due to changes in VAT etc. For me to give a detailed estimate with part number, etc is too much and I dont think its worth it just to prove the above prices since I have to sit with parts catalogue, service manual and price list. If you feel they are just word of mouth figures then I rest the case here.

Last edited by audioholic : 23rd June 2014 at 00:15.
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Old 23rd June 2014, 00:54   #52
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Default Re: Safety Features - Myths on costs debunked

Dear Vishal,

In my postings not that everywhere I can be right nor everywhere I am wrong. But the links I have given are authentic. Sadly, the counter posts were lacking "research by search" and instead catchy one liners were rule of the day.

For example, my further search indicates that even Polo and Vento were to come out with compulsory air bags. Please see link http://www.team-bhp.com/news/vw-polo...ice-hike-feb-1 which gives the resultant price hike as well. Whether it was implemented or not I am not sure. If I can search and find this info now why not x y or z? Can anyone find out further details?

I hope further search and adding info will add value to the discussion.
An ostrich like attitude will not add to knowledge base.

Regds
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Old 23rd June 2014, 02:26   #53
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Default Re: Safety Features - Myths on costs debunked

folks extrapolating ABS profit margins - Here's some food for thought.
http://www.inventorycurve.com/GMROI.html
ABS on cars is given more or less at cost (maybe + a slight premium) because the profit is on the car, not the part itself. so companies don't focus on part or option pack margins themselves.

But on the other hand, when it comes to pricing spare parts, nobody does cost plus pricing any more (if they are, it's time to have a good relook at their pricing policies). Anyway, Let me take the case of the humble air filter. assuming that a company carries a week's worth of stock on hand, we are looking at about a 100 inventory turns in a year.
assuming a low 25% profit margin, and plugging that into the GMROI formula, you get 33%, which is very nice. VERY NICE.

But the humble air filter is a rock star at least as far as sales and operations goes. It practically sells itself, there is a fairly predictable and significant demand for it. Other auto parts aren't that lucky, like for example the spoiler on an S10 palio. Either way, the Industry average for turns for auto parts is in the 10-12 range (source)

Anyway, for the ABS parts in question - the situation is grim - ABS car volumes are low, accidents involving ABS components are even lower and more sporadic, making demand rather hard to predict, and carmakers cannot buy, say 7 or 32 units - there are usually order quantity constraints (that's another story).

Anywho, I'll give a very optimistic 4 turns a year, and reduce the GMROI to 16% - 33% is unreasonable, but at least it should recover the cost of working capital finance... right ?

You plug those values into the formula, and you get a gross margin of 80%. - this is purely the rate you need to sell it to make up for purely the finance cost. You add other costs (shrink, labour etc....) and things begin to go bad very fast.

While things look like bean counters are ruining road safety, the company is in business to make an honest profit, right?

The way out - either some sort of subsidy, or at least push up the number of abs cars on indian roads, so that the demand becomes a bit more predictable, and volumes go up so that the turn goes up as well. Things are slightly better now than before, but without the govt stepping in to make it mandatory, like it is doing it for the CV and bus sector.

Noob MBA here - would appreciate inputs from auto industry folks on actual numbers vs my guesses, and from fin folks if my GMROI fundas are off
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Old 23rd June 2014, 06:35   #54
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Default Re: Safety Features - Myths on costs debunked

If I may interject - my point in starting this thread was to raise and spread awareness (and change perceptions) that models with critical safety equipment like airbags and abs need not be prohibitively more expensive than ones without them. From the original link in the thread starter, I gathered as much. Now of course there may be airbags of different quality/price in the market and even spurious stuff floating around but one does expect all reputed car manufacturers to stick to some basic quality of equipment when it comes to critical stuff like these. (And certainly recalls may happen as with any other part in a car of any manufacturer).
But I reiterate that that bottom line of this thread is the fact that these things need not be perceived as prohibitively expensive and beyond reach (if unbundled from other bells and whistles). It would be great for customers if car makers offered these in the bottom segments too (at maybe just cost).
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Old 23rd June 2014, 07:06   #55
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Default Re: Safety Features - Myths on costs debunked

@green horn. Low turn over spares generally get padded with inventory carrying costs so that some sales margins are maintained. Each company will have its own over head costs. Eg Merc may incur a high over head costs to maintain an inventory of a spare like root horn and try to recover it with good margin from customer (which I am not trying to justify). Where as the same item, because of its large turn over and low over heads may be priced low by another company. It possibly explains why certain items like air bags are differently priced by different companies although the source of supply may be identical for different car maker.

I think as customers it would be prudent on our part to identify the original supplier and get the spare from them (for items like air filter, fuel filter, LO filter etc). Or go by tech spec and compatibility and quality in case more than one supplier is available.On safety items such as air bags, we may not like to do the same due to the element of risks involved (in online buying or inadvertently getting defective/ used/ spurious/recycled spares). One has to take a call.

Like others have stated elsewhere in this forum, unless air bags/ abs etc are mandatory, the car makers will be reluctant to offer them on basic models for the fear of loosing cost conscious customer.

And I hope the cenrtal government, which is in the process of introducing a new RTO bill, will make such safety items compulsory. Post Gopinath Munde (may his soul RIP) episode, it is possible to make government realise the same by creating more awareness and public opinion.

Last edited by alavandar : 23rd June 2014 at 07:17. Reason: Last line added
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Old 24th June 2014, 22:50   #56
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Default Re: Safety Features - Myths on costs debunked

Quote:
Originally Posted by alavandar View Post

I think as customers it would be prudent on our part to identify the original supplier and get the spare from them (for items like air filter, fuel filter, LO filter etc). Or go by tech spec and compatibility and quality in case more than one supplier is available.On safety items such as air bags, we may not like to do the same due to the element of risks involved (in online buying or inadvertently getting defective/ used/ spurious/recycled spares). One has to take a call.
Such a strategy might prove to be counter productive. Usually the fast moving items end up cross subsidizing the slow moving ones, and cover the supply chain costs for the manufacturer. When customers go to the open market for the regular parts, it drives up per item costs for the manufacturer for the other items, and they will pass it in entirety to the hapless customer, and you will end up losing a lot more there than you saved on your regular maintenance parts .
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Old 24th November 2014, 19:53   #57
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Arrow The Real Cost of Adding safety Features

In today’s newspaper I read that several manufacturers had echoed the sentiments of the Chairman of Maruti Suzuki, that in an extremely price sensitive market such as India, the introduction of safety features would increase the cost of vehicle sales and therefore buyers would turn away from such offerings.
Now I realise that for a “common man” a car from X Company with parking sensor and a Bluetooth/Aux/I-Pod Music System and Central Locking et. al. might be more alluring; however if we were to really look beyond the hyperbole, just how much really does it cost to add safety features to a car.


Cost of an Airbag for manufacturer
After some research I located the following information that roughly Driver+Passenger Airbag systems cost between-Rs. 35,000-Rs. 80000 [here] (Why do Indian car manufacturers skimp on airbags?) and [here] (Swift ZXI airbag replacement - to do or not to do ?). If any one has better information, please feel free chip in. However to bring in some realistic pricing
SX-4 Costing according to parts catalog for SX4 [for the purpose of this thread I am approximating the costs]
1. Drivers side A/B module - Rs. 5358
2. Passengers side A/B module - Rs. 6056
3. Airbag control module + main harness - Rs. 4048
4. Passenger airbag harness - Rs. 1627
5. Airbag sensor + harness - Rs. 3076

Total cost: Rs. 20165
Source-here (Safety Features - Myths on costs debunked)
Thus, bringing the total [adding taxes and even some margin for overheads]=Rs. 30,000

Cost of ABS for manufacturer
Some browsing revealed that an ABS unit from Bosch would cost around Rs. 6,000 [here] (Safety Features - Myths on costs debunked)
Thus total Cost for Airbags+ABS to the manufacturer=Rs. 36,000
Thus total marked up cost=Rs. 40,000
The Test Subjects-Maruti Suzuki Swift, Honda Amaze and Grand i10
All prices for OTR Price Gurgaon.
_______________________________
Maruti Suzuki Swift
Lowest Version-Lxi-Rs. 474,674 [Lxi+ABS if sold=Rs. 514,674]
1st Version with ABS+Airbags-Zxi-Rs. 633,739
Differential-Rs. 158,975
What do you get in Zxi over the Lxi [data sourced from MSIL Swift Website]
System/Feature
Airbags
ABS
EBD
Brake Assist
Central Locking with remote
Rear Parking Sensor
Driver Height Adjustable Seat
Front and Rear Headrests
Front Seat Pockets
Power windows
Rear defogger
Integrated blinkers
Electrically adjustable mirror
Remote boot opening
Coloured ORVM
Rear Wiper
Integrated music system with Bluetooth/aux and 6 speakers with Steering Controls
Alloy Wheels
Tachometer
Engine Start Stop System
Fog Lamps
___________________________
Honda Amaze
Lowest Version
E-ivtec-Rs. 531,774 [if sold with ABS+Airbags=RS. 571,774]
1st Version with Airbags+ABS-SX- Rs. 682,286
Difference-Rs. 150,512
What do you get in SX over the E [data sourced from Honda Amaze website]
System/Feature
Airbags
Pre-tensioners
ABS
Vanity Mirror
Driver height adjustable seat
Front Seat Pocket
Body Coloured Mirrors
Music System with Aux/USB
4 Speakers
Body coloured Door Handle
Keyless Entry
Electric Mirrors
Rear Armrest
12V power outlet
Tachometer
______________________
Hyundai Grand i10
Lowest Version
Era 1.2 VTVT-Rs. 477,447 [if sold with safety features-Rs. 517447]
1st Version with ABS+Airbags-Asta (O) 1.2 VTVT-Rs. 597,574
Differential-Rs. 127,104
What do you get in the Asta (O) over the Era [data sourced from Grand i10 Website]
System/Feature
Airbags
ABS
Key-less Start
Vanity Mirror
Rear Parking Sensor
1 Extra power outlet
Driver Height Adjustable Seat
Front and Read Head-Rest [rear adjustable]
Rear windows are also powered
Rear Defogger
Bootlid opener with remote
Body coloured mirrors with integrated blinker
Rear wiper
Body coloured bumpers
Music system with USB/Aux/Bluetooth+1 GB memory
4 speakers
Alloys
Rear Spoiler
Leather wrapped steering
Steering Controls
_____________________

I believe that the above amply demonstrates that the price increase as a result of adding safety features is not as high as is sought to be stated. The bundle of course costs the staggering premiums being charged, however lets reflect, does a USB music system really help in reducing the chance of injury over an airbag?

In my opinion, the manufacturers, should offer the safety pack as optional, for fitment on any version, thus I might prefer to buy the lowest version+safety pack.

To use a cliche, knowledge is power, and I think we as Team-Bhpian's are uniquely positioned to bring out the facts.

I'm indebted to the numerous posts I've hyper linked. Thanks guys!

Assumptions
1. the prices of the features are assumptions, hard data where available has been provided to the best of my ability.
2. Choice of cars-mainly premium hatchbacks that sell fairly large numbers.
3. Prices of the cars are according to website and adding insurance+RTO as prescribed the Haryana RTO Website [I also used an on-road car pricing website]

@mods-please fell free to merge this thread if its similar to the costs debunked thread.
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Old 24th November 2014, 23:36   #58
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One more point to be noted that generally the spares and other parts are more expensive when bought separately as the manufacturer allows the OEM to price the parts at will to cover his lesser margins in bulk quantities supplied to manufacturer that are straight away used in production of the car. So, the actual cost of ABS/Airbags can be still lower than what is quoted by you. IIRC on Satyamev Jayate Aamir Khan just casually mentioned the cost of putting ABS/Airbags as15-20 thousand. So we are still doing the guess work due to the cloud of secrecy maintained by the manufacturers. But yes, at the same time, the total cost (incl dashboard replacement, etc.) of replacing them also needs to be considered. Similarly, it should also be known that how much of that is covered by insurance companies. I read its only 50%.
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Old 25th November 2014, 08:49   #59
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Default Re: The Real Cost of Adding safety Features

Anybody who is looking for a car with safety features has no choice but to extend his budget by a huge margin or for for a smaller segment car in the top trim.

Manufacturers force you to buy top end with all the bells and whistles if you want safety features.

What if I want a basic Elite i20 with ABS and airbags at close to 7L. Well sorry you have to get the Asta which is 8L on road in Bangalore if you want airbags and ABS.

The only manufacturer to buck that trend is VW who have made it standard across their entire portfolio of cars.

Why can't Maruti have Swift LXI and LXI (SP) with airbags and ABS. Same for VXI. Let the buyer decide between LXI SP and VXI with no safety.
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Old 25th November 2014, 08:52   #60
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Default Re: The Real Cost of Adding safety Features

Here is one car model that I can think of where between two variants can give a picture of how much a manufacturer charges for safety variants:

Information sourced from Carwale website.

Amaze Petrol (S vs SX)

In petrol variant SX has ABS+ 2 Airbags (hence seat belts with pretensioner and load-limiter) in addition to S variant.
Cost difference: Rs 54,000 (for ABS + 2 Airbags)

Safety Features - Myths on costs debunked-amaze-safe.jpg

Amaze Diesel (S vs SX)

In diesel variant SX has 2 Airbags (hence seat belts with pretensioner and load-limiter) in addition to S variant (Note: ABS in standard across all Amaze diesel variants).
Cost difference: Rs 42,000 (for 2 Airbags)

Safety Features - Myths on costs debunked-amaze-diesel.jpg

Hence, Honda charges Rs. 42K for 2 Airbags and Rs.12K for ABS to customers as far as Amaze model is concerned.
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