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Old 4th March 2008, 15:39   #1
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Exclamation Impact Budget: Used car prices drop

New Delhi/Mumbai: The 4 per cent excise cut on small cars in Budget 2008-09 is expected to accelerate sales in the second-hand car market.

Just three days after the Budget, prices of second-hand small car models have dropped nearly 10 per cent and dealers said they expect sales to accelerate as a result.

The March price drop follows the 15 to 30 per cent fall in second-hand car prices in January owing to the impending launch of the Nano, which went on display at the Auto Expo in Delhi. The world’s cheapest car will be available for Rs 1 lakh in October this year.

“The fall in small car prices in the second-hand car market is much sharper than the price cuts announced by car manufacturers after the Budget,” said Arif Fazulbhoy, director of Fazulbhoy Motors, a leading dealer for second-hand cars in Mumbai.

Two-year-old small cars have seen prices drop 6 to 7 per cent and for three-year-old cars it is around 5 per cent, he added.

Meanwhile, Maruti Suzuki announced price cuts ranging from Rs 6,500 for the Maruti 800 to Rs 18,030 for the Swift Diesel (ex-showroom Delhi).Hyundai slashed prices between Rs 12,000 and Rs 14,000 on the Santro, Getz and i10. GM also lowered prices between Rs 7,500 and Rs 14,000 on the Spark and UVA Aveo variants.

The sharp fall in second-hand car prices is expected to stimulate demand. “We think the contribution of small cars will go up from 65 to 70 per cent of our sales,” said Ankit Sharma, manager of Delhi- based second-hand car dealer Patliputra Automart.

Sharma said the Santro LT power-steering model popular with youngsters now has a post-Budget price tag of Rs 1,95,000 compared with Rs 2,10,000 before the Budget.

"The shake-up in the small car segment will also have an impact on prices of larger cars in the months to come,” admits a senior executive at TVS Motors, which is in the second-hand car market.

Others said the price impact is already palpable in this segment. “The price of the Tata Indigo has fallen Rs 15,000 to Rs 20,000 and the Accent GLX is down Rs 20,000 after the excise cut. And all these cars are three to four years old,” said Sharma.

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Old 5th March 2008, 10:30   #2
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I enquired with few dealers in used car for a 4-6 months used 6K kms, Verna VGT SX ABS and they quoted 7lacs max and lowest was 6.5lakhs. Pity was that most of them dont know that there is a variant in Verna SX ABS.
However, when I asked them I would like to buy one at the price quoted- everyone replied in negative- no stocks available. No wonder who would not like it at this price and ironically, who would like to sell at that price!
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Old 6th March 2008, 09:28   #3
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Quote:
Originally Posted by dadu View Post
New Delhi/Mumbai: “The price of the Tata Indigo has fallen Rs 15,000 to Rs 20,000 and the Accent GLX is down Rs 20,000 after the excise cut. And all these cars are three to four years old,” said Sharma.

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I think you mean INdigo CS as this is the only sedan that comes in the sub 4 meter category and takes advantage of the reduction in duty
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Old 6th March 2008, 12:26   #4
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Why should the second hand price drop as a result of budget?I dint find any reason for that.Maybe indigo prices in the second hand market may go down as a result of CS.
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Old 6th March 2008, 15:32   #5
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If the price of a new car goes down by 10k, the cost of the same model in second hand market also will go down by around the same. otherwise it tempts the second hand buyer to go for the new one (the additional cost of getting the new one is lesser)
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Old 6th March 2008, 18:17   #6
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Palio 1.1 prices are also reduced but no reduction in 1.6 prices
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Old 7th March 2008, 00:05   #7
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Originally Posted by Rahulkool View Post
Palio 1.1 prices are also reduced but no reduction in 1.6 prices
The reduction is for cars below 1.2 ltr in petrols and below 1.5 for diesel.So naturally 1.6 is out of the limits.
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