Go Back   Team-BHP > BHP India > The Indian Car Scene


Reply
 
Thread Tools Search this Thread
Old 9th March 2011, 11:52   #16
Senior - BHPian
 
asr245's Avatar
 
Join Date: Dec 2007
Location: Gurgaon
Posts: 1,135
Thanked: 360 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

Quote:
Originally Posted by TOR View Post
The Indian Governments idea would be to make India a hub for these European car makers for Export to the region( as is happening in China).

The concern is not the 'volumes in India' but the place of India as a manufacturing hub and industrial power in the region.

This could well be a case of economic strategy rather than helping the Indian mass market car makers.
Well said or explained.

If they see India in their long term plans they shouldn't be scared to do this (maybe just delay it). If they don't, then they just want to sell till they can and then exit. In that case, to hell with them!
asr245 is offline   Reply With Quote
Old 9th March 2011, 11:54   #17
Senior - BHPian
 
Join Date: Oct 2009
Location: BANG-A-LURE.
Posts: 1,111
Thanked: 3,462 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

Quote:
Originally Posted by sgiitk View Post
Are not Audi, VW and Skoda part of the same stable? if so then setting up local manufacturing may not be such a big deal.
Quote:
Originally Posted by ghodlur View Post
VW and Skoda have been producing mass market products whereas Audi targets only the Class market where the sales figures are not that eye popping. can you imagine Audi or Merc or BMW introducing an affordable hatch for the Indian market in the 4-6L rupees range. Thats highly impossible.
+1 on this Ghodlur.

Lexus is also a subsidiary of Toyota, can you also imagine Lexus setting up a local manufacturing unit here or introduce a model in B or C segment.?
SILVERWOOD is offline   Reply With Quote
Old 9th March 2011, 12:06   #18
Team-BHP Support
 
mobike008's Avatar
 
Join Date: Sep 2006
Location: Hyderabad
Posts: 10,728
Thanked: 7,890 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

Absolutely right there Ghodlur. BMW has come down way too down with their X1 and I think thats the least they can come down to capture the market in a certain segment.

Audi, BMW and Mercedes depend a lot of brand value and target customers accordingly. They are definetly not in the mass game. Hence, a local manafacturing unit for them would be a distant dream as the volumes dont justify the huge investment.
mobike008 is offline   Reply With Quote
Old 9th March 2011, 12:23   #19
BHPian
 
Join Date: Nov 2007
Location: Bangalore
Posts: 769
Thanked: 376 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

If I put myself in Audi's shoes;

You plan your business assuming a stable Govt policy and decide on large scale investments based on economics that are worked out with such policies. While tinkering around the policies is fine but these policies must be stable.

Changes in policies (including tactical changes like change in definition of CKD imports) that suddenly upset the whole economics of the business is very unsettling. If it is backed by intelligent reasoning and some time for adjustment it's fine. But if not then such changes look arbitrary and sudden and has long term implications. Overnight your past investments look like an irrecoverable loss and future investments are in jeopardy.

Further;

It has implications on employees, dealers, current customers, not to mention loss of revenue to the Govt. - sudden increase in taxes never got the Govt more revenue because it shuts down demand abruptly.

Further think about FDI implications. India is badly seeking foreign direct investments but who would want to invest when big daddy tries an alcoholic's random walk on taxes.

I hope the Govt is not inspired by Jairam Ramesh who said German SUVs are baneful or something like that, because they consume subsidized diesel, forgetting that their consumption as %age of total will make a change in the 4th decimal.

Hope this is rolled back - not because I want to own one but because this move is as eccentric as it can get.

Cheers,
diffsoft is offline   Reply With Quote
Old 9th March 2011, 12:36   #20
Senior - BHPian
 
asr245's Avatar
 
Join Date: Dec 2007
Location: Gurgaon
Posts: 1,135
Thanked: 360 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

Quote:
Originally Posted by diffsoft View Post
If I put myself in Audi's shoes;


Cheers,
What do see when you put yourself in GOI's shoes w.r.t. investment, technology, manufacturing prowess, China etc.?
asr245 is offline   Reply With Quote
Old 9th March 2011, 12:36   #21
BHPian
 
rm_arjuna's Avatar
 
Join Date: Jan 2009
Location: Hyderabad
Posts: 448
Thanked: 55 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

If these luxury brands are really serious about indian market and want to garner growing spend on luxury wheels , they better stay instead of making such threats . anyways these luxury wheels are bought by ultra rich and another 10+ lac increase would not make much of a difference to them .

o.T. Jairam ramesh would be happy to see such reaction from these automakers ,who in his opinion are marketing fuel guzzlers and impacting the environment.
rm_arjuna is offline   Reply With Quote
Old 9th March 2011, 13:13   #22
BHPian
 
ajman28's Avatar
 
Join Date: May 2010
Location: Chennai
Posts: 277
Thanked: 22 Times
Default

Quote:
Originally Posted by sgiitk View Post
Are not Audi, VW and Skoda part of the same stable? if so then setting up local manufacturing may not be such a big deal.
Precisely so. All three are in the same group and call themselves VAS.

Audi should look at sharing one of the plants of either VW or Skoda in India. In this manner investment is lesser and the benefits should be much higher. Renault and Nissan are sharing a plant in Chennai and they are not even from the same family in other parts of the world.

Personally I feel Audi has a good future in India. First we had the Merc wave and now we have the Bmer wave. I think it's just a matter of time before it is Audi's turn.
ajman28 is offline   Reply With Quote
Old 9th March 2011, 13:16   #23
v&v
Senior - BHPian
 
v&v's Avatar
 
Join Date: Aug 2007
Location: Delhi
Posts: 1,538
Thanked: 1,068 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

I think it is more to do with the definition of CBU, CDK, Semi CDK. Most manufactures are getting benefit of bringing parts and assembling in India at 10% duty. Under this there is no classification or specification of parts. Hence these manufactures where taking benefit of this loop hole to bring engine and transmission as PARTS. Now its being classified hence the duty will increase to 60% on the same. Now the game has changed, you will need a engine/transmission assembling plant too. I recently read somewhere is BMW is open for the same. Soon you will find others too following the same path.
v&v is offline   Reply With Quote
Old 9th March 2011, 13:28   #24
BHPian
 
Join Date: Sep 2009
Location: Gurgaon
Posts: 49
Thanked: 0 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

Let them make a Mfg hub in india and use it as export base also. Which no doubt shall help India economically.
dkcrpl is offline   Reply With Quote
Old 9th March 2011, 13:29   #25
BHPian
 
Join Date: Oct 2010
Location: PNQ - PUNE
Posts: 133
Thanked: 33 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

Well government has removed those cars which have Pre Assembled Engines, Transmission etc from CKD definition. The FM wont make a hasty decision and he has done the right thing IMHO.

He wants their manufacturing process to get localized stage wise. All they have to do is to now even start assembling their engines and transmission here in India. And kindly note that it is "assembling" and not "manufacturing". There are a lot of components that go into making of an engine and a transmission kit, which are also available in India. Maybe they can import engine and transmission parts and also buy only quality parts from India to complete the units.

As for T-Etios. on 1st march Toyota has inaugurated their engine plant in India. And etios as a whole isn't a CKD car. Only its engine is imported so I don't know why are they classifying H-City and T-Etios under CKD category.

For Audi all I would say is that it is the safest of all the luxury marquees as it got its sister concerns VW and Skoda manufacturing cars in India. They wouldn't have to necessarily manufacture Audi cars but only assemble everything here itself. Imagine how many jobs would get created.

It is FM's way of forcing them to reach a level of localization which otherwise they wouldn't start working on their own. They would for the rest of their lives sit and import CKD kits. IMO this step was long due one day or the other.

Last edited by psbali : 9th March 2011 at 13:35. Reason: Addition.
psbali is offline   Reply With Quote
Old 9th March 2011, 14:04   #26
aby
BHPian
 
Join Date: Jan 2008
Location: Bangalore
Posts: 97
Thanked: 6 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

I think it is one of the many bargaining tactics employed by the Germans. They cannot afford to quit one of the fastest growing markets and then watch their rivals establish a firm footing in India. IMO among the big-3 German luxury brands, Audi has the least favorable reputation. Leaving the customers in the lurch is sure sign of watch the brand die in India.

Mods: I think the title of the thread is misleading. Audi has not announced that they are planning to quit India. They have just said that this is one of the many things they are considering. The title gives an impression that they have started the separation process rolling.
aby is offline   Reply With Quote
Old 9th March 2011, 14:05   #27
Team-BHP Support
 
.anshuman's Avatar
 
Join Date: Dec 2004
Location: Good-Gaon
Posts: 7,708
Thanked: 8,928 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

The new definition of CKD says the cars which come with pre assembled Engines and Transmissions will now be categorised as CBU attracting 60% duty instead of the previous 10%.

Well it's bad news for us Petrolheads too. Pick any model from Audi, Mercedes or BMW, Be it A4 or the C class, all of them come with multiple engine options. For Example the A4 has the 1.8 TFSi, 2.0 TDi, 2.0TFSi, 3.TDi etc, evem the transmissions mated to them are different. So if the Government makes them manufacture the Engines and Transmissions locally, do you think they will be able to offer so many options?

In fact manufacturers who have already setup plants to locally manufacture engines like Maruti has done for the DDIS or Ford has done for the TDCi will try to extend the lifecycle of the engine to maximise their profits, Expect the 1.3 DDIS to be sold in the next to next gen Swift, or maybe a gen later too(unless the emission norms force it off). Even cars like i20 CRDi, Verna CRDi etc come with imported engines.

The popular perception is anyone buying a BMW, Audi, Merc or Jaguar will have endless money stashed in the banks, so it does not matter at all. There are petrolheads who work hard just to be able to afford a bimmer or a Merc.

Setting up a plant to manufacture engine and transmissions for low volume cars is huge task, it requires lots of money and time. By the time a Manufacturer.

Quote:
Originally Posted by ajman28 View Post
Audi should look at sharing one of the plants of either VW or Skoda in India.
They already share the plant but even the VW and Skoda cars come with imported Engines and Transmissions, which are also shared by Audi(2.0 CR TDi and 1.8 TSi).
.anshuman is offline   Reply With Quote
Old 9th March 2011, 14:08   #28
v&v
Senior - BHPian
 
v&v's Avatar
 
Join Date: Aug 2007
Location: Delhi
Posts: 1,538
Thanked: 1,068 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

Quote:
Originally Posted by aby View Post
Mods: I think the title of the thread is misleading. Audi has not announced that they are planning to quit India. They have just said that this is one of the many things they are considering. The title gives an impression that they have started the separation process rolling.
More over this is not going to effect Audi only. Many in line. Also two wheelers like Ninja, Harley and dont know about the CBR 250, even i have booked one . Think the proposed price is going to change.
v&v is offline   Reply With Quote
Old 9th March 2011, 14:15   #29
BHPian
 
ra'ul M's Avatar
 
Join Date: Jan 2011
Location: Chandigarh
Posts: 222
Thanked: 45 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

I just got a message from Audi today offering fantastic discounts. Wonder if this is related to the news being discussed here.
Ill have to check though.
But its not an option they will choose IMHO as they are not affected in isolation from the others and financially they are as capable as any. Its a case of 'being in the same boat' although the boat appears to be rocking right now
ra'ul M is offline   Reply With Quote
Old 9th March 2011, 14:27   #30
Distinguished - BHPian
 
sgiitk's Avatar
 
Join Date: Dec 2007
Location: Kanpur
Posts: 7,160
Thanked: 3,755 Times
Default Re: Audi planning to exit India in the backdrop of recent budget proposals

@ghodlur: What I was hinting at that expanding manufacturing should not be too tough for Audi since the group is already here.

Do not be too sure that you will not see BMW/Merc in the 10-12L segment in the not too distant future.
sgiitk is offline   Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
Audi planning SQ5 for India? _raVan_ The Indian Car Scene 3 20th February 2014 13:45
My recent visit to India (Delhi) redcandle Super-Cars & Imports in India 34 26th December 2007 12:03
My recent visit to India (Delhi) - Interesting Encounters redcandle Street Experiences 22 21st November 2007 19:17


All times are GMT +5.5. The time now is 19:12.

Copyright 2000 - 2017, Team-BHP.com
Proudly powered by E2E Networks