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Old 19th March 2010, 18:11   #1
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Default Heavy corporate discounts or discriminatory pricing

I would like fellow BHPians to post their take on corporate discounts. Is this just? I feel this is discriminatory. I was searching for a new car and was quite impressed after test driving Ford Fiesta 1.6. I wanted to make an immediate purchase.
So the negotiations started for the pricing. I was shocked to hear from the sales people that they offer a corporate discount of up to 75K on Fiesta to employees of corporates like Wipro, Infosys etc. They told that my company (which is the second largest Microprocessor Company in the world) is not in their list and can't give any discounts. Then I asked about the criteria for giving such atrocious discounts to select few corporates. He told something like minimum of 4 cars should be purchased from employees of the corporate. But didn't have any clue what is the number of actual purchases made by employees of such companies. Never mind, he told that he will initiate process to include my company in the corporate list. Took down the details of all ford cars in my company. Then he asked me to give the id proofs of the owners of these cars. I lost the cool and told him it is not with in my rights to ask these people to provide id proofs for something of no interest to them. Finally I received a mail from Ford saying that they have decided not to give any corporate discount to me. I had to drop the plan to buy the car i liked a lot
So my questions.
1) How can they give such atrocious discounts of up to 75K to select few? If it would have been a few thousands, I would not have raised this issue at all. But it is almost 10% of the price.
2) Does this qualifies as discriminatory pricing? Discounting to select few with the high margins imposed on others.
3) Who will compensate the buyer who has paid the full amount for fall in the resale value due to such heavy discounts?
4) What are the criteria for including a corporate in the select list? Is this process transparent?
Most of other car dealers are offering corporate discounts in the range 0-10K which seemed just.
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Old 19th March 2010, 22:16   #2
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10%! I thought these kind of discount are for restaurants around offices of these corporates! These have reached for cars! In which century am I or on which planet!

Thanks for bringing this up as I will also keep this at the back of my mind while discussing pricing. If I hear such huge discounts I will definitely bid adieu to such manufacturers/cars as I feel this is indeed discriminatory.
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Old 19th March 2010, 22:23   #3
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10%! I thought these kind of discount are for restaurants around offices of these corporates! These have reached for cars! In which century am I or on which planet!

Thanks for bringing this up as I will also keep this at the back of my mind while discussing pricing. If I hear such huge discounts I will definitely bid adieu to such manufacturers/cars as I feel this is indeed discriminatory.
Not sure if you refer to discrimination among corporates or between corporates and individuals. Without prejudice, discounts for corporates is in a way making up for the punishing regn/road tax for corporates in states like Maharashtra.
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Old 19th March 2010, 22:26   #4
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Is it really discriminatory pricing?
The reason corporates are given more discount is because they buy a higher number of cars at one time. I am sure if you were to buy 5-6 cars from the same company, even you would receive a heft discount along those lines.
Also, corporations have to pay more tax for the cars as well.
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Old 19th March 2010, 22:29   #5
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That is true. Honda had offered discounts upto Rs.80,000 on the new City for all employees where my dad works. Same with Ford, Hyundai and Chevrolet too. But keep in mind, corporate registration of a vehicle also costs twice that of individual registration.
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Old 19th March 2010, 22:32   #6
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Corporate discount of 75K is unheard of!

As far as I know, it will be 8 - 10K, I got only 8K on my car purchase.
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Old 19th March 2010, 22:36   #7
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Corporate discount of 75K is unheard of!

As far as I know, it will be 8 - 10K, I got only 8K on my car purchase.
I agree. I checked with Honda, Fiat, Ford & Hyundai and the discounts were between 6-10K.
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Old 19th March 2010, 22:39   #8
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Pardon my ignorance. I am not sure whether the term coporate discount is only for corporate leases where the corporate buys the car on the behalf of employees. I thought the offer is for the employees of select corporates even when they do individual registration.
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Old 19th March 2010, 22:39   #9
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But keep in mind, corporate registration of a vehicle also costs twice that of individual registration.
That's not true in Karnataka though, there is no difference.
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Old 19th March 2010, 22:41   #10
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For it companies like the ones op mentioned, u will get two or three thousand discount for personal cars. To get 75k discount you need to belong to a company that is a supplier to the car company. I am only talking about cars registered for personal use.
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Old 19th March 2010, 22:52   #11
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Honda has companies labeled as platinum etc based on the certain criteria. For instance, the corp discount for a Civic for CTS, TCS, Wipro, HP etc is 20K while it is 25K for IBM and a few other companies. The difference is because companies like IBM are regular customers of Honda and buy a large number of Honda cars themselves for corporate use.

Again, the corp discount is not borne entirely by the dealer. 50% of it is borne by the corporate.
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Old 19th March 2010, 22:53   #12
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My experience on this is limited to Fiesta. This was admitted by the salesman himself. There are numerous ownerships threads on Fiesta in Team BHP and most of them have got hefty discounts. Around same time when i was in negotiating one BHPian has booked a Fiesta with same dealer as can be seen in the following link. See the price he has got where as the quote for me was 8.31lakhs.
http://www.team-bhp.com/forum/test-d...thread-44.html
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Old 19th March 2010, 23:21   #13
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Default 75k is unheard of

I seriously doubt the corporate discount of 75k, the max i have heard is 10k while working for one of the below mentioned companies.
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Old 19th March 2010, 23:47   #14
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1. Fiesta SXi Corp disc (eg.Wipro) was around 60K when I checked last month. A friend of mine was enquiring. This is individual registration.

2. There's no Free Meal in this world. Please don't feel let out that you are not getting the discount and someone else is getting. There should be a logic why certain companies are chosen. The sales person might not know (Common they don't even know about the car they are selling). But people in the Sales and Marketing know for sure. Unless we know that, there's no point in complaining.
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Old 19th March 2010, 23:57   #15
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Quote:
Originally Posted by poloman View Post
1) How can they give such atrocious discounts of up to 75K to select few? If it would have been a few thousands, I would not have raised this issue at all. But it is almost 10% of the price.
2) Does this qualifies as discriminatory pricing? Discounting to select few with the high margins imposed on others.
3) Who will compensate the buyer who has paid the full amount for fall in the resale value due to such heavy discounts?
4) What are the criteria for including a corporate in the select list? Is this process transparent?
Most of other car dealers are offering corporate discounts in the range 0-10K which seemed just.
1. word of mouth marketing and 'peer imitation' is what is being encouraged. so if you are a dude from Infosys, and you have 5000 guys looking at your car everyday - its probable that your purchase will cause 25 others to buy the car (whether u recommend the car or just that they are influenced by the sight of your purchase). So companies offer discounts to such large corporates because they know that they will gain back from purchases by your peers

2. it is discriminatory pricing. but there is no law against it..in fact as a strategist, im very happy that companies would think to this level for revenue enhancement

3. Nobody ur better off buying the market leading car - which probably offers little of no discount to anyone

4. refer point 1 - it will tell u the logic
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