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View Poll Results: Government Regulations on Automobile Sector -
1) Good for consumers but not other stakeholders (industry, revenue dept, environment etc) 16 11.85%
2) Good for other stakeholders but not consumers/enthusiasts 24 17.78%
3) Has done a reasonable job of keeping all stakeholders happy. A fine balancing act. 68 50.37%
4) Has held back the automobile sector. Should let the free markets decide. 27 20.00%
Voters: 135. You may not vote on this poll

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Old 14th March 2017, 00:47   #16
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Default Re: Government regulations on the automobile sector - Good or Bad?

Excellent Poll, I opted for option 3.

Quote:
Originally Posted by smartcat View Post

1) Making safety aids mandatory - like airbags, ABS or reversing camera.

Attachment 1618041

I do not support making things like safety aids mandatory when we know that -

- These aids add to the cost, and reduces affordability
- Pedestrians, 2 wheelers & 3 wheelers constitute 80% plus deaths. Cars? Less than 5%. The reason why we have 150,000 deaths a year is not because cars have no airbags. It's because not enough people are driving cars!
- Aren't we denying people an opportunity to upgrade to a car by unnecessarily increasing its costs? Every rupee counts.

I say let the consumer decide what he wants to buy. If you are fixated on "car safety" all the time, then everybody needs to save up enough to buy a 2 tonne SUV equipped with ESP/8 airbags and nothing else.
I would say making regulations that will make cars safe is as important as creating new roads and related infrastructure. Safety in Indian cars is a complete joke, just compare the cars sold in India and else where. Even if its the same make/model/manufacturing plant, the safety spec sheet for the car sold in India is pathetic compared to the ones sold in the export market.
I agree that all these will result in added cost and affect affordability, but only in the short term. When something becomes mandatory manufacturers will find way to make it cheaper by improving efficiency - thanks to competition. End of the day Maruti (for eg) will try to price its car cheaper than Hyundai (for eg).
Infact everything that the automotive sector in India and abroad enjoys attributes to the several regulations passed by the governing bodies in those regions.

I agree that lifes lost on road have a lot more to do than just improving car safety, but that is definitely not an excuse for the government to shy away from making necessary changes to the regulations.


Quote:
2) Mandatory crash tests and rating
Its late, but better be late than never.


Quote:
3) Not allowing Bajaj Qute to sell to customers as a private car

What a grave injustice. I'm totally with Rajiv Bajaj on this. How is Bajaj allowed to sell millions of bikes, but not Qute because of "safety concerns"? Incredibly warped logic.
I am not sure if I agree fully. When its a car it gets allowed to be driven on expressways which are banned for two wheelers or three wheelers. It basically becomes more exposed to high speed crashes and I guess government is right in this case.

Quote:
4) Variable central taxes/import duties

Attachment 1618048

The central govt taxes we pay on a car is dependent on import content of a car......
Agree.

Quote:
5) Not allowing foreign pre-owned cars to be sold in India

Attachment 1618049

Same as above, makes lot of sense from industry/jobs point of view. Bad for consumers obviously.
....
Agreed, but could risk India becoming a dumping ground.

Quote:
6) Taxes based on length, engine size etc

Skews the market with no real benefits to customers, car companies, country's fuel consumption, country's air pollution or to the revenue department. And yes, thanks to this regulation, we get to see this on the road quite often .....
Couldnt agree more. But I blame the manufacturers for all those 'Innovations'. They tried to fit every shape that a vehicle can take into the 4M length and that is the reason why we have compact sedans and compact SUVs. Unfortunately these vehicles are popular among Indian customers so almost all manufacturers ended up making one. Even VW, I never thought they would try making a compact sedan.

Quote:
7) State taxes:

Attachment 1618062

Central taxes have a role to play in gently nudging automakers towards job creation and development of Indian auto/auto component companies. But state taxes are just a source of revenue for the state government. Reduces affordability of cars and indirectly contributes to road deaths by forcing customers to stick to bikes.
In my opinion there should be one road tax that's applicable to the whole country. How government wants to divide it among different states is up-to them.

Quote:
8) Differential pricing for petrol, diesel, Kerosene & Jet fuel:

Attachment 1618063

For us, it is mostly about petrol and diesel .....

...Reduce fuel prices, encourage car usage and save thousands of lives a year.
Quote:
9) Air pollution (banning old cars, penalty on diesel engines based on size, odd-even day usage etc)

Attachment 1618064

Personally, I have no opinion on this issue!
With rising NOx levels in the air and the harm it does to environment and to humans I would recommend adding more tax on diesel cars to encourage people buy petrol cars. Price gap between petrol and diesel is narrowing anyway so its only going to make more sense to move to petrol cars.

Quote:
10) Toll Roads:

Attachment 1618065

All for toll roads as long as Government uses technology to help eliminate queues!
I would add having an expiry date for tolls should only be levied if a road is upto a certain standard. When I used to drive between Pune/ Bangalore/ Calicut, I remember paying quite a lot on tolls between Pune- Satara secton of NH4 even though the condition of the roads were poor.
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Old 14th March 2017, 01:05   #17
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Default Re: Government regulations on the automobile sector - Good or Bad?

Quote:
Originally Posted by landcruiser123 View Post
I don't see initial cost as barrier for buying a car, education and consumer awareness is. 10,000 rupees more is not too much of a hike. If you think we can get majority of 2W riders to switch to cars, you are wrong.
Quote:
Originally Posted by Hayek View Post
Between different safety aids, my bias would be for regulation to make those that save lives of bystanders (such as ABS, reversing cameras, and potentially pedestrian air bags) compulsory,
Quote:
Originally Posted by carmayogi View Post
Further of the thousands who die on bikes, aren't many of them hit by cars? Does the statistic count the car then? No it does not. In fact, that same car with ABS & ESP may be able to swerve successfully and miss the bike or not hit the bike when out of control in the first place.
Quote:
Originally Posted by rejoycjohn View Post
I agree that all these will result in added cost and affect affordability, but only in the short term. When something becomes mandatory manufacturers will find way to make it cheaper by improving efficiency - thanks to competition.
I guess I have to admit that each of the arguments in bold are frankly brilliant, and something that I had not thought of earlier. I'm changing my view on this one then - making safety aids (like ABS & reversing camera) compulsory in all cars seems like a step in the right direction.
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Old 14th March 2017, 10:05   #18
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Default Re: Government regulations on the automobile sector - Good or Bad?

I feel its definitely good, except for the Bajaj Qute bit. If an Omni is allowed on our roads, why not this one?

Quote:
Originally Posted by smartcat View Post
1) Making safety aids mandatory - like airbags, ABS or reversing camera.

I do not support making things like safety aids mandatory when we know that -

- These aids add to the cost, and reduces affordability
- Pedestrians, 2 wheelers & 3 wheelers constitute 80% plus deaths. Cars? Less than 5%. The reason why we have 150,000 deaths a year is not because cars have no airbags. It's because not enough people are driving cars!
- Aren't we denying people an opportunity to upgrade to a car by unnecessarily increasing its costs? Every rupee counts.

I say let the consumer decide what he wants to buy. If you are fixated on "car safety" all the time, then everybody needs to save up enough to buy a 2 tonne SUV equipped with ESP/8 airbags and nothing else.
In the markets where these are mandatory, nobody charges a penny extra for safety features. Even in India if you look at a BMW or a Mercedes, they donít really charge anything extra in the name of safety. See the safety specifications for a 3 series (below). The price variance between a base prestige variant and a M-Sport variant of a 320d is in the vicinity of 10 lakhs, but no differentiation whatsoever in the name of safety. Even in a mass-market model, having seat belts do not reduce affordability; itís mandatory by law and hence doesn't drive the cost up.

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Old 14th March 2017, 10:07   #19
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Default Re: Government regulations on the automobile sector - Good or Bad?

We have to watch out against an over zealous babudom, and also an industry which in the interest of cost was no safety systems. This may be the wrong time to discuss, since the GST implementation may produce more ripples.
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Old 14th March 2017, 11:04   #20
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Default Re: Government regulations on the automobile sector - Good or Bad?

Quote:
Originally Posted by Mad Max View Post
Why - I include government, excise, customs, revenue departments in the stakeholders list. The insane amount of excise duties, RTO fees etc. just drags down every single car purchase happiness. The car is 10L and bam! you're suddenly shelling out another 1-2L depending on which state you live.
Sir, blame the citizens of this country, not the government.

Even as a car enthusiast, I fully agree with taxing the heck out of cars. Reason = they are the rare big ticket item that HAS to be bought with white money.

IIRC, less than 4% of this country pays income tax. Let people come out of their hiding holes & pay their fair share of income tax, and we'll automatically see taxes on such expenditures come down. How the heck does one run a country when the mere single digits pay their taxes? We always say 'oh, cars in the USA are so cheap". Well, 50% of Americans pay their taxes & black money is a minuscule part of their economy. Of course, the country also offers economies of scale (not unusual for an Accord or Camry to sell 4 lakh units a year in the USA).

Until the situation improves, all luxuries (cars, eating out etc.) must & will be heavily taxed.
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Old 14th March 2017, 11:16   #21
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Default Re: Government regulations on the automobile sector - Good or Bad?

Voted for option 3 - balancing act.

I echo the sentiments that govt/judiciary have sometimes been overreaching (sunfilm ban), random (4 m / 1200 cc / 1500 cc rules), ridiculous (2000 cc diesel ban), experimental (odd/even), but we are a young nation in terms of car culture, so there shall be a few hiccups and acts which are experimental in nature.

The silver lining for me is the upcoming national safety ratings for cars - much needed for a country where head unit features are valued over head safety (!).

Just wondering if someone could quickly make the left ORVM mandatory in the meantime!
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Old 14th March 2017, 11:25   #22
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Default Re: Government regulations on the automobile sector - Good or Bad?

Well, to me, it’s a mixed bag of elements. Whilst its is important to allow certain degree of freedom to the automobile manufacturers so that the best of the available technology is brought into the market , at the same time the administrative soverign has to exercise control on certain nooses to channelize the direction in which the Automobile Sector would grow.

Firstly the good part:

1. Mandating safety features such as airbags, collapsible steering, door auto unlock at crash, fuel cutoff at crash, bucket seats, seat belts, et-al as elimentary requirements – These features turn life savers, which otherwise would have been eliminated on most cars as a result of the cost cutting exercise, if left solely to the choice of manufacturers.
2. Tax benefits for smaller cars (under 4 mtr body length and smaller engines) - This regulation serves duel purpose a) making small cars more affordable and saving on road space occupied b) Smaller engines contribute lesser to air pollution.
3. Encouraging local production - Creates Employment, helps domestic Engineers ingest the technical know-how of advanced machines and might help the country become self reliant by creating indegenous compeitive cars in future, Exports bring foreign revenues, helps creation of ancilliary industries for manufacture of spares, consumables, logistics, processing, etc.
4. Mandating safety practices such as wearing seat belts, helments, et-al, saves lives where as banning horns that shrill, fancy sounds, etc , brings discipline on road. One could recall there were days when even indicator lights were considered as luxury features before the Government made them compulsary.

The not so good part:

1. Not all regulations imposed by the administrative soverign are reasonably justified - The ban on sun films stand as an example. A few are not well implemented as well, just see the sheer number of PUC centres which give away the PUC certificate without proper tests.
2. Most regulations deal with cars alone and not the Automotive sector as a whole – I wonder what prevents the Government from mandating seat belts on Autorickshaws (Max Speed at about 60 Kmph) as well.
3. Parity in taxes across states continue– There exist cases where state A with smaller road network charges more road tax than state B with larger road network. Heck one cannot even use a car from other state as well.


So far so good. Hence voted for Option 3 – the balancing act.

Last edited by King_pin09 : 14th March 2017 at 11:52.
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Old 14th March 2017, 11:30   #23
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Default Re: Government regulations on the automobile sector - Good or Bad?

I voted for option 3) Has done a reasonable job of keeping all stakeholders happy. A fine balancing act.

I say this with the understanding that the government though slow in reacting has reacted mostly in the right direction. This for me is very critical thing worthy of applause.

Regarding the other option of leaving some enthusiasts unhappy can be countered by observing that India does have enthusiast specific cars like Abarth, SCross 1.6, Polo TSi, Linea Tjet, BMW 320d, heck even the legend 911R has been imported in India.

I will conclude by stating that even in a family of 4 there are cases when someone is unhappy this is an entire nation of 1.25 billion we are talking about, so someone is bound to feel left out !!
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Old 14th March 2017, 14:37   #24
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Default Re: Government regulations on the automobile sector - Good or Bad?

Quote:
Originally Posted by GTO View Post
Even as a car enthusiast, I fully agree with taxing the heck out of cars. Reason = they are the rare big ticket item that HAS to be bought with white money.
I also thought the same till I talked to some bank managers post Demonetization (Demonization to some). I was wondering why the car sales were hurt that much. Two wheelers yes, but four wheelers ??

What I learnt opened my eyes. A large number of cars are bought on finance (no issues here). But after the first installment or so, the repayment was often in cash. Also, mostly it was done within 12 months. Nobody seems to check and match the repayments and the amount loaned. This was confirmed by at least two retired bank managers. Buyers were happy as were the bank managers.
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Old 15th March 2017, 00:52   #25
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Default Re: Government regulations on the automobile sector - Good or Bad?

I think the fundamental problem with the Indian auto-sector regulations is that there is no technically qualified body for many taking decisions / or atleast educating the decision-makers at the policy level.

Many of the issues today can be traced down to incompetence and lack of understanding of the sector. I do not agree that the Government has done a good job of regulating the sector at all - with everyone being the loser.

Particular areas where the government has failed, in my opinion

1. Car safety standards

a. Basic safety standards (such as ABS and airbags) should have been mandatory a long time ago. The incremental cost is likely be nominal - it may even fall significantly if the consumption volume increases upon these safety devices being made mandatory.

b. Crash tests should be made mandatory; there should be an extensive publicity / education programme on the meaning and importance of the crash test results.

Much of India is still un / ill-educated, with most consumers being ill-equipped to appreciate the importance of these safety features. The onus is on the Government to mandate these safety standards. Where we are today, market forces alone will not be sufficient.


2. Tax rebates to incentivise safety / lower emissions / mileage

As many posters have observed, engine size / length based tax slabs are meaningless. It serves neither the government, nor the manufacturer or the environment.

Can we not have tax rebates / incentives for (i) better safety ratings (ii) lower emissions (iii) higher mileage?


3. Encourage car-pooling apps like Uber-pool instead of banning them

Karnataka has recently made moves to ban taxi-pooling services citing some hyper-technical legal grounds. The government should understand that these services are responsible for a significant reduction in traffic and emissions. They should be encouraging car pooling, not banning it.


4. Sun film

Blanket ban of sun film is the most senseless decision I can think of. Having VLT standards would have been an easy solution, but a thick headed government will not agree.


I dont think any of the above issues arose due to lobbying or vested interests. In my view, it is largely incompetence and apathy.
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Old 16th March 2017, 06:00   #26
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Default Re: Government regulations on the automobile sector - Good or Bad?

Quote:
Originally Posted by smartcat View Post

1) Making safety aids mandatory - like airbags, ABS or reversing camera.
Some manufacturers do not even provide the left rear view mirror (not mandated by regulation) on lower end models. Govt's responsibility is to set up minimum safety standards. On bikes & cars. It is not about being fixated on safety, but enforcing crash tests, rear view cameras/sensors aid in safety.

Quote:
Originally Posted by smartcat View Post
2) Mandatory crash tests and rating
Mandatory 3 star or 4 star crash test rating required. Cannot have cars that will structurally disintegrate on a crash. Economies of scale will eventually reduce the cost of making safer cars.

Quote:
Originally Posted by smartcat View Post
3) Not allowing Bajaj Qute to sell to customers as a private car
I look at Rajiv Bajaj's speech as a sales pitch. Mad in India? Too many regulations? Do not forget, it was the same company that opposed deregulating & breaking down of license raj citing increased competition will kill domestic makers. A company once wanted regulations to stay, today says too many?

WRT Qute, think of those lousy under powered & over loaded Tata Ace type of vehicles on our highways. Aren't they a safety hazard for its occupants and others on the road? Now imagine Quite with 5 people in the car. Moreover, the 'affordable' Nano (without safety features, crash tests) failed since bikers did not 'upgrade'.

Quote:
Originally Posted by smartcat View Post
4) Variable central taxes/import duties:
You would want to have all the foreign cars. Our infra is not developed. Our road manners are not up to the mark. Plus, we need jobs for the very young Indian population. You wouldn't want to see a car manufactured in Germany by robots at lower cost compete with your locally manufactured car. Duty of govt to protect & generate employment.


Quote:
Originally Posted by smartcat View Post
5) Not allowing foreign pre-owned cars to be sold in India
Completely against India becoming a dumping ground/junk yard for cars driven by rich kids in developed markets. New cars, with basic safety features made in India will do the job, & will eventually bring exciting cars too.


Quote:
Originally Posted by smartcat View Post
6) Taxes based on length, engine size etc
Agree. These rules need to be fine tuned by people who know about cars. Cannot let M&M get away with a lower excise duty on XUV500 due to the artificial small ground clearance.

Two buckets - small cars & others. Lower taxes on small cars to improve affordability. Rest, pay a little more.


Quote:
Originally Posted by smartcat View Post
7) State taxes:
Ask people of Karnataka. 14% - 18% road tax. Maybe even more and other levies. Hurts to see a bloke in Kerala pay much lesser than one in Karnataka for the same car.

Quote:
Originally Posted by smartcat View Post
8) Differential pricing for petrol, diesel, Kerosene & Jet fuel
Given that petrol and diesel have subsidies removed, it is time to rationalize taxes on both fuels.

Also, move towards elimination of usage of Kerosene is to be made (and is already being made I believe. States like Haryana have taken a lead).

Programs like 'Give it up' & enabling more ppl get LPG connections certainly helps.

Quote:
Originally Posted by smartcat View Post
9) Air pollution (banning old cars, penalty on diesel engines based on size, odd-even day usage etc)
Some formula of car usage + year of manufacture etc has to be considered. A 5 year diesel car with 50K on the odo must be polluting less than a 2 year old car with 1.5L on the odo.

Similarly, modern diesels of Hyundai will be polluting less than that of the older Tata engines.

Quote:
Originally Posted by smartcat View Post
10) Toll Roads:

All for toll roads as long as Government uses technology to help eliminate queues!
to that.

Or even better, eliminate Tolls itself.

--------

Conclusion: Need govt regulation for maintaining minimum standards. Govt's are not supposed to be in the business of doing business, such as running Maruti. But adequate regulation will put a minimum requirement on at least some greedy capitalistic car makers who will exploit every bit of regulation to make money.

And, economies of scale in making safer products will bring down cost of manufacturing, at least eventually. Costs should not stop us from putting minimum limits of safety.
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Old 20th March 2017, 18:20   #27
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Default Re: Government regulations on the automobile sector - Good or Bad?

You forgot to add the arbitrary ban on sun films a few years ago that stopped a 150 cr industry overnight.

I don't see all the above as a grand plan to boost local production and make India a hub. In fact, I see it as a ploy to make indigenous manufacturers gain more share irrespective of their quality, safety, performance etc.

Also other rules like the reduced taxes of sub 4 meter cars but caring two hoots about cars with better fuel efficiency, classification of an SUV, are all done at some stupid babu's whim and fancy - customer jaye khadde mein
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Old 20th March 2017, 18:36   #28
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Default Re: Government regulations on the automobile sector - Good or Bad?

Sometimes, only a Government intervention can herald a change in the automobile space.

There is a thread in the Technical Stuff section discussing the need/viability of making fire detectors/ extinguishers compulsory in cars. Will all car owners do it voluntarily? I am really doubtful.

If ever we are to see portable fire extinguishers fixed to the passenger side A pillar of all cars, it can only be done through a Government regulation.

Last edited by dailydriver : 20th March 2017 at 18:43.
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