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Old 9th September 2015, 14:18   #1
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Default What happens after you book a car?

I've had this doubt in my mind for a while now. What happens when we book a car? So we booked it in a showroom, what next? How does the the manufacturer know? What is the procedure followed? By the time the loan processing is done and down-payment paid, is the car being manufactured or is put on hold? Related posts shed some information on whether the cars can be tracked from factory to showroom, but are not reliable and we tend to believe the sales rep er booked our car from more than the manufacturer themselves.
So can anyone shed some light on this topic?

Mods : i did a search in Team-BHP but was usually getting the "I booked my car thread" or "cancel booking" or "bookings open" threads. If this is a redundant post, please move to specific section.
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Old 9th September 2015, 14:48   #2
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Smile re: What happens after you book a car?

Unless you've booked a Bentley Continental Flying Spur with the whale pe**s leather or a Rolls Royce Phantom Drophead with the just-right blue tinge or a Pagani Zonda with the optional Carbon Ceramic brake pack, a manufacturer won't really know who or what has booked a car. They just keep on stamping out models on their assemble line, load them onto trucks/boats/trains and ship them out to dealers who've put in requisitions for cars. It is really that simple.

As far as I know, most luxury marques allow their customers to customize their cars to the nth degree. Paint color, interior trim, alloys, brake caliper colors, alcantara or cashmere roof lining, yada yada yada, the list is endless. If you are booking something like that with a million customizations, then yes, a unique car will be built and allocated to you as per your specification.

If you're a mango man, buying another mango car, then there is no complexity involved. You book the car at the dealer, dealer places a request for another such car, car gets allocated to you based on the assumption that you can pay or wont cancel your booking. Car gets sent to dealer lot, you then see the car, make the payment if all is well, car gets registered in your name, gets updated in their master database. If you don't take the car, or payment issues happen, car gets allocated to the next guy/gal in the line. And that's all there is to it.

Last edited by Gannu_1 : 11th September 2015 at 10:40. Reason: Clubbing sentences to paragraphs.
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Old 9th September 2015, 15:11   #3
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Default re: What happens after you book a car?

Pre-bookings & bookings are just a way for the company to know, which colour, trim are in demand, and adjust the production line accordingly.
I believe the information company receives is just for statistics, and they will not do anything differently, because they only have fixed number of colours and trims, and the companies do not offer any customizations.
Booking & waiting period idea is also one way for the dealers, to give priority to their important customers - and make the unknowns wait endlessly.

Regarding loan processing - if it fails for someone, or someone cancels the booking, dealers anyway will try to allot the same vehicle to the next person. Why else people end up with cars of colours and trims which they did not request for?
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Old 9th September 2015, 15:17   #4
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Default re: What happens after you book a car?

Usually a dealer gives their monthly requirements to the manufacturer nearly 6 months in advance, and has the cars in their stockyard. These cars are usually owned by the dealer, i.e, purchased by the dealer from the manufacturer at their cost. When you make a booking the dealer will allot you a car from their stock and register it on your name. It's quite simple really.

Many companies like Mercedes use custom orders from dealers as a way of market research. Over the years they've come to the conclusion that silvers are usually ordered with black interiors and white and black cars with beige interiors. Now all the CKD cars made by Merc in India come in those combinations.
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Old 9th September 2015, 15:40   #5
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Default re: What happens after you book a car?

Quote:
Originally Posted by sourav9385 View Post
Unless you've booked a Bentley Continental Flying Spur with the whale pe**s leather or a Rolls Royce Phantom Drophead with the just-right blue tinge or a Pagani Zonda with the optional Carbon Ceramic brake pack, a manufacturer won't really know who or what has booked a car.

They just keep on stamping out models on their assemble line, load them onto trucks/boats/trains and ship them out to dealers who've put in requisitions for cars. It is really that simple.
I booked a humble Figo in February 2014 and this is what I received from Ford in e-mail after a week or so :

What happens after you book a car?-mailfrm-ford.jpg

This was followed by a SMS containing the date of dispatch from Chennai and estimated date of arrival at my Dealer.
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Old 9th September 2015, 19:03   #6
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Default re: What happens after you book a car?

Wow. Thanks all for your inputs. I was always under the impression that any booking is directly notified to the manufacturer. That also explains the 2-3 month waiting for all popular cars.
You would expect in today's age that manufacturers would give their customers a more connected sort of feeling. However, as per the rules of the land, once the money comes in, the customer is shown the door.
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Old 9th September 2015, 20:48   #7
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Dealers usually are asked to forecast their requirements a month or so in advance depending on company policy. Dealers are usually allocated quota of vehicles and they can log indents either on their own or through the Regional Office of the manufacturer.
Typically dealers lift the running models even without bookings so that the same can be made available asap to the customers.
However both the dealers and manufacturers take into account the retail and booking trend before forecasting or allocating quota of vehicles.
Vehicle manufacturing is more or less fixed depending on a lot of variables but there is always a margin for last minute adjustments depending on requirement/revised targets

Now, if a booked vehicle is not in quota or stock of the dealer, a request is raised to the HO through the RO. Depending on availability the vehicle is despatched to the dealer.
It is upto the dealer to inform the customer regarding date of despatch which they can see on their dealer management systems.
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Old 10th September 2015, 08:23   #8
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Default re: What happens after you book a car?

I don't know about other manufacturers, but from my few years of working at MSIL, I know that a mass market OEM simply cannot make cars according to what a customer orders at the dealer level.

Just imagine a regular month at MSIL where 1,00,000 cars are rolled out of the production lines - considering a 6 day working week (assembly lines work on Sundays only in rare, unavoidable situations) - that is 4,000 cars per day. (Let us forget the huge inventory at the OEM yards and hundreds of dealer stock yards across the country for a moment, and consider the average production as 1,00,000 cars in a month).

Now, out of these 4,000 cars made per day - there are 13 models, and a mind-numbing number of variations.

Let us consider the bare basic Alto800.

Alto800 comes in 7 variants - STD, LX, LXi, LXi Airbag, LXi CNG, VXi, VXi Airbag : and : 5 colours - that alone makes it 35 variants of a single model which has basically one fuel option (barring the single CNG variant) and zero factory options.

Apart from the Gypsy which has a separate assembly line, many of these 13 models are made on same assembly lines - and at speeds which enable assembly of 4000 cars in a single day (even considering multiple shifts and multiple assembly lines, the speed at which lines move has to be seen to be believed).

For these 4,000 cars - hundreds of suppliers supply tens of thousands of components every single day - simply because any smart manufacturer maintains next to no inventory at the factory warehouses - they follow a very efficient Just-in-time policy. These hundreds of Tier 1 suppliers depend on their Tier 2 and 3 suppliers for their sub-components. Not to forget, MSIL themselves and many of their suppliers have to depend on imported components / raw materials from across the world. To transport these at an affordable cost, they are shipped by sea and many times, takes up to 3 months from time-of-order to time-of-arrival.

Now, if MSIL was to receive my order after I make a booking at one of the 1000+ dealers across India for a specific model in a specific colour and fuel option and let us say, with a factory option such as ABS (like the Ritz VDi ABS) or Airbag, the efforts, co-ordination and time required to make a specific car allotted to me is unimaginable. To put it simply, it is impossible to do it efficiently!

This is what actually happens:
  • Production planning department, Marketing and Sales personnel sit together, co-ordinate with various departments across the company and make production forecasts for 3 - 6 months. It is an incredibly difficult task and impossible to get right perfectly, unless the OEM is ready to hold an inventory of tens of thousands of cars, at any point of time.
  • Also, the monthly sales vary widely according to the time of the year (model year change, expected changes in Union Budget) and regions (regional festivals).
  • The models, variants and colours which sell the most - say Swift VXi in silver (just a random example) - of course, you can plan in large numbers. But what about, say, a WagonR VXi ABS option in Chocolate Brown? How many of those sell month-on-month?

Dealers, in order to not lose a sale to competitor(s), many a times, hold excess inventory. If they don't have the car you want, they simply enter the order in the system which is received the Vehicle Dispatch department at the manufacturer who check the inventory and allot the vehicle accordingly. If it is not available at the factory, the order is transferred to Production division who then plan it for the next available time (at least not in the same month for a manufacturer where the production lines are already running overtime). That is why, sometimes, your car takes a long time to arrive (other than of course, if the dealer is useless and does not order the car on time).

Hope this helps in some way AveekKumar! Cheers!

Last edited by ampere : 10th September 2015 at 10:25. Reason: edited as requested
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Old 10th September 2015, 08:52   #9
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Default re: What happens after you book a car?

So is there any order number or something like that which the customer can demand as proof of order being placed by dealer at least in the case of Maruti if he is opting for a rarely bought variant?
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Old 10th September 2015, 09:19   #10
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Default re: What happens after you book a car?

Quote:
Originally Posted by mi2n View Post
I booked a humble Figo in February 2014 and this is what I received from Ford in e-mail after a week or so :
Yes, Ford does that.

I got the same by email the very next day after booking. It's was a very nice touch. And as per the VIN, date of manufacture was 19 days after the booking and we got delivery within the next 10 days.

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Fiesta will be a one off case as the 2014 version was mostly built on order. But Ford does know when the dealer enters the booking details in their system and an automated communication is sent to the prospective buyer.
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Old 10th September 2015, 09:50   #11
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Default Re: What happens after you book a car?

Quote:
Originally Posted by Ramon View Post
So is there any order number or something like that which the customer can demand as proof of order being placed by dealer at least in the case of Maruti if he is opting for a rarely bought variant?
Yes, although I cannot seem to remember the exact term used for that order number from dealer to OEM. You can demand it, and if the dealer cannot prove that he has ordered that particular car you require even after a reasonable period (say, a week) of your paying him the booking amount, I suggest you call Maruti customer care and explain your concern.
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Old 10th September 2015, 11:25   #12
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Default Re: What happens after you book a car?

Quote:
Originally Posted by mi2n View Post
I booked a humble Figo in February 2014 and this is what I received from Ford in e-mail after a week or so
Quote:
Originally Posted by deetjohn View Post
Yes, Ford does that.

I got the same by email the very next day after booking. It's was a very nice touch. And as per the VIN, date of manufacture was 19 days after the booking and we got delivery within the next 10 days.
I am pleasantly surprised by how Ford has started to keep the customer informed about the booking. Well, this shows that Ford has taken customer feedbacks seriously.

A brief background to this. When the Ecosport was launched there were long waiting times and the dealers used the opportunity to make money the wrong way. There were many cases where people skipped the queue by offering to pay premiums and also dealers were forcing customers to buy their insurance and certain exhorbitantly priced accessories. Also, there was literally no idea regarding our booking and it was the dealer who laid the rules.

About a year after the launch, I was lucky to be invited to a customer feedback event where the actual Ecosport product development team, engineers and heads from various departments were interacting with customers and collecting feedbacks. It was done in a very systematic manner and there were several rounds and in each round someone from a specific department (say Engine and Powertrain/ ICE/ sales) would interview us.

A couple of points that were highlighted and which I see as implemented now are:

- The turn indicator stalks and the wiper stalks set on european mode. This is now corrected in the New Figo Aspire
- Transparency in booking. Which I now see being implemented in the above cases.
- Hard suspension set-up in the Ecosport. Heard that the company is gonna make it more soft in the upcoming facelift version. This has been also considered in the new Figo aspire.

There were more discussed but not relevant in this post.

Happy for Ford as they have listened to our fredbacks.

Last edited by GTO : 11th September 2015 at 10:14. Reason: Typos
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Old 10th September 2015, 11:42   #13
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Default Re: What happens after you book a car?

Quote:
Originally Posted by AveekKumar View Post
I've had this doubt in my mind for a while now. What happens when we book a car? So we booked it in a showroom, what next? How does the the manufacturer know?
Good Question. Most of the above posts have explained how it works. But just to give you another perspective.

All Mass Market models are produced not based on Customer order, but based on forecasts. The process is exactly like how Philips would manufacture a light bulb. They don't build a light bulb when you go buy at the shop. It is mass produced.
Most dealers use a software application called Partner channel management which is a part of ERP software and will be connected to Manufacturers' Production system. Their ERP will automatically check the inventory and allot the car for you which is already manufactured, if it is not available only then it goes into their production planning and then to assembly line.
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Old 10th September 2015, 12:02   #14
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Default Re: What happens after you book a car?

Based on my interactions with dealer personnel, here is what I know.

First, the sales advisor will check the dealer's own inventory for stock, and he/she will try and convince the customer to buy the variant/colour that is in stock.
If the customer is not convinced, then the dealer will check manufacturer stock. Yes, manufacturers have inventory piled up in factory and in various locations across the country (especially Maruti & Hyundai). If the car is found in manufacturer stock, then they will get that car for you.
If not, then it is a case of figuring out when that particular variant/colour will get manufactured - I guess the dealer has some view of the factory's manufacturing ERP? Or, I think based on order, a manufacturer can schedule that particular variant/colour to be manufactured earlier than planned?
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Old 10th September 2015, 12:47   #15
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Default Re: What happens after you book a car?

Thank you all for your inputs. One thing is clear. The mass manufacturers have no idea about who the owner of the production car will be, and second, the dealer is our only source of information(except Ford). No wonder Team-BHP puts so much stress on the VIN. When i booked my Elite I opted for the stardust because i saw too many reds on the road. My view was a less common color would be available faster than the most common color. However, i still haven't received any conformation from my sales guy. Lets see what happens.
Kudos to Ford for their customer-centric approach. Wish other manufacturers would learn.
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