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-   -   The "NEW" Car Price Check Thread - Track Price Changes, Discounts, Offers & Deals (https://www.team-bhp.com/forum/indian-car-scene/112549-new-car-price-check-thread-track-price-changes-discounts-offers-deals-597.html)

Everybody seems upset about so called ‘overpriced’ cars, I would imagine an elementary understanding of inflation and the time value of money eludes them. Take a typical midsize family sedan like a Camry for eg:

2010 ex showroom price: 24L
2022 ex showroom price: 41L

India has averaged 6-7% inflation in the last 10 years, so taking 24L at 6.5% compounded annually for 12 years = 51.1L, which is 10L more than what it costs today.

In fact considering the current Camry is a hybrid which costs significantly more to produce, in inflation adjusted terms it is much, much cheaper than the 2010 petrol Camry. Cheers.

No offence to any one here, Toyota increasing the price is Opportunistic, there's no question on that.

However expecting a good chunk of probable Fortuner buyers to look at Tata/Mahindra products as alternative isn't going to happen. Irrespective of the bells and whistles and Cost advantage an Indian manufacturer has, there is simply no way a person ready to spend 35/40 lakhs is going to buy a unreliable product.

For Toyota to rationalize their pricing, we need a Honda to launch similar products. There simply isn't any competition to a Toyota other than a Honda. I do believe their products were rationally priced when Honda was actually interested in selling vehicles in India. There was also a time when Fortuner was priced lower than a Pajero Sport.

I seriously don't think any unreliable vehicle/brand like Tata/Mahindra/Skoda would pull a good chunk of customers from Toyota

Your calculation is based on the assumption that all the product ranges sold in India all inflate equally at 6.5% year on year, every year, which isn't true.

For e.g., using the calculator I've linked at the end of this para, it says that yearly inflation from 2019 to the end of 2021('2022') has only been 6.62% every year, but we know that diesel prices alone went from 60Rs. in 2020 to 90Rs. or above in 2021, a 50% increase in one year. (I don't fill diesel so I haven't kept track too closely) And the Fortuner's prices have been increased 15% from last year. Which aren't closely reflected by the inflation rates. Calculator - https://www.inflationtool.com/indian...?amount=100000
(Also, your example of the Camry is a premium D2 segment car in India, competing with luxury brands and unsurprisingly priced at an at least 70% premium compared to developed countries like the US and Australia.)

To keep track of this, the are various price indices that track different things. We would have heard of some of them in the news such as CPI and WPI. Similarly, there's a price index for cars, too - the wholesale price indice for India from 2013 to 2021, available here - https://www.statista.com/statistics/...motives-india/ This says that the price index increase for cars every year from 2013 to 2021 has only been around 2.1-2.8%. I would love to take a look at the detailed reports, but I'm not paying for it. lol: So instead, I'll list some examples I know off the top of my head -starting with the 2004 Elantra CRDi, which went for 10-12 lakhs ex-showroom (maybe including a loan amount or some other accessory, but I know for sure that the ex-showroom price was not below 10L.)

Going by your estimate, the 2020 Elantra diesel should have been launched at 31L ex-showroom (15 years compounding annually at 6.5%). But a quick search on Team-BHP shows that the top-end version went for <21L ex-showroom, a full 10 lakhs or 33% lower!

Okay, maybe that's a unique case where one model was overpriced and the later models were kind of a flop. But there's also the Vento - launched around 2010 with the top-end variant reaching around 8L or so ex-showroom. My Autocar magazine dated August 2016 says that the price of the Rapid 1.6MPi lowest variant was 9-9.5L OTR. And as recently as last year, the Rapid Rider with a 1.0TSi (without a doubt, a big upgrade) was launched for 7.79L ex-showroom.

You can debate my individual examples, but ultimately they don't matter much because the wholesale price index for cars has only gone up 20% from 2013 to 2021 - not the 100% hike in price that the Fortuner has undergone as posted by achyutaghosh earlier in the thread. Following my train of thought, I think there is a moat for the Fortuner, a group of people who will try their best to buy Fortuners, and only Fortuners, regardless of the price or value offered or compatibility for their specific needs. And other than Toyota cars, I haven't seen any other brands' cars rise so consistently in value, facing so little depreciation that people with aged and well-worn Innovas sell them for not much lower than what they paid for them. Honestly, if there were cars(or any other products/assets) that could consistently increase in value by 6.5% year-on-year, with no risk, I think there would be a lot of takers for stocks of that company/asset. Beats the 3.5% interest in savings offered by large banks.

(P.S. I'm definitely not blaming Toyota here - if any manufacturer finds out that they can sell a certain car at a higher price than before, they will. Toyota can and should capitalize on it - they built the brand with their reliability and low cost of maintenance. Apple has a greater than 50% manufacturing margin on their iPhones! - https://www.reuters.com/article/us-a...-idUSKBN1D62RZ)

On a lighter note, the 50% or greater tax you pay to buy a Fortuner also seems to compound 6.5% annually. ;)

MG hikes price of the Gloster by upto 1.32L. It’s still cheaper than the Fortuner though.

So true, and I hope the tide will turn soon. Apropos, this comment for Nassim Taleb: "I've seen gluts not followed by shortages, but I've never seen a shortage not followed by a glut."

Source: https://twitter.com/nntaleb/status/1...090117?lang=en

If it makes you feel better, do know that it is now every 10,000 km,and for its class, service costs are very very reasonable- so there is that too.

I dont know why car price increases are justified as due to inflation.

This is absurd, a motor vehicle is by no means gold, real estate, stocks, bonds, food etc. to be keeping pace with inflation.

Neither is it technology stuff that actually reduces prices e.g. laptops, mobiles, internet, routers, even clothes footwear prices also never increased as per inflation rates.

If this is the case then my latest laptop or mobile which is 1000 times more advanced than 20 years back and costs a fraction today.

With this inflation logic the same laptop / mobile should be costing crores now.

Car is somewhere in between consisting of technology gizmos as well as metal/components, so prices should either decrease with increased competition and technical advancements.

Prices of batteries, touch screen systems, electric components and many other things actually come down with mass production, technical developments and competition.

Automobile prices in India are absurd as everyone is milking the consumer, the competition is either killed or operate as cartels where everyone increases prices together and create shortages to people here.

Even government is not behind in taking advantage and increasing already exorbitant taxes, fees, registration and what to mention of 1000% hike of taxes on fuel (from rs.3/ltr to rs. 35/ltr now only excise).

Many argue that cars have started giving more features, but most of them are gizmos, and many infact have cut down on quality big time (honda, toyota) and many have removed features (hyundai, tata) in reality which was part of base model earlier but now moved to upper models only.

Heck even some decrease the nuts and bolts and plastics to further cut corners while increasing the price at the same time.

The only exception are government regulations on safety which every car manufacturer has to abide by and provide them as skimpily as they can.

I had earlier posted how I bought and i20 10 years back at 6lacs otr and now with double budget am not even getting a similar car.

Yes my income has more than doubled but if the same inflation criteria is to be pegged my inflation adjusted income might have reduced, as my purchase parity has gone down.

So, the prices are totally insane and I do not find them justified by any means even if inflation adjusted it should be stable due to technological advancements mass production and a competitive market, but sadly this is not the case.

It is true, there’s a reason it’s called the average rate of inflation, if you combine all the different inflation indices and divide by the number taken you’ll get the avg. inflation rate. For quick calculation that’s more than enough.

Taking your own calculator, the inflation was 13.76% over the last two years, which is about ~6.5%/year, which is what I said earlier. Using just the price of diesel is not accurate as it is abnormally taxed by our government at artificially high rates, and they change the cess % at their whim and fancy, not aligned with the market at all. Fortuner’s prices are spot on in inflation adjusted terms from 2010 (22L then and 49L now). The reason you’re feeling it’s too high is because it’s not become cheaper in actual inflation adjusted terms like other cars have.

For eg:
20 years ago in 2002 Honda City was 8L, today it’s 16L. In inflation adjusted terms it should be 25L+ today, (6% over 20 years). The fact that it isn’t means it’s much cheaper in real money terms today than it was in 2002.
I can give you countless other examples that have kept pace with inflation, take pizza, iPhones, clothing, Coca Cola, etc. all have approximately doubled from their 2011 pricing. Heck even my drivers salary has exactly doubled since 2011 (10k vs 20k/month).

I don’t know which banks you follow but last I checked, savings a/c rate of interest was 5-6% in most major banks. And there are plenty of low risk investments that avg 10-12% per annum.
CAGR for the last 20 years: Nifty 50: 14.18%, Gold: 12.38%, FD’s: 7.1%. Take your pick.

You’re right, the 2020 Elantra at 21L is much, much cheaper than a 2004 Elantra at 11L in adjusted terms.

I fail to see how cars can appreciate at just 2.5%/year over a 9 year period when literally every other commodity has nearly doubled in pricing, cars are assembled from raw materials just like everything else and their prices directly affect production cost.

A Camry is not a luxury car by any means, it’s a midsize family sedan like Accord. just cause it’s sold for more in India than other countries due to a variety of factors like import duties and taxes, doesn’t change the nature of the product itself. It’s like saying a $10 hamburger is a luxury product cause it’s sold for 5x that price in some remote location, it’s still a hamburger.

Neither does the Camry compete with luxury cars in India or outside, the closest rivals - 5 Series and E class are nearly double the ex showroom price at 70-75L vs 41L.

We can of course, agree to disagree. Cheers.

Another way to do it is to compare dollar price of car based on prevalent conversion rate (given that inflation in US is quite low). With that, I bought my Civic for 16L in 2010 (USD 16L/47 = $34000) and till last year, Civic was selling for 22L (USD 22L/74 = $30000). So infact, it actually became cheaper in dollar terms. What are we complaining about? clap:

Any idea what is the discount on the Skoda Superb currently? A friend has been offered approx 2L in Mumbai. Any better offers ?

Exactly! According to the values seen earlier in this thread -

2013 - 1 USD = 60 INR (a conservatively high estimate, seeing as it was 54 for the first half of the year, 61 in the months after August and 65 in August 2013 alone)
2013 Fortuner - 25L OTR - 41,667 USD

2022 - 1 USD = 75 INR
2022 Fortuner - 50L OTR - 66,667 USD
*shrugs*

And before someone compares it with the rise in price of iPhones that are known to have a 67% or so manufacturing profit margin baked into the price nowadays, the inflated value of 42k USD is only 50k USD today - here's the US inflation calculator : https://www.officialdata.org/us/infl...3?amount=42000

As you very nicely pointed out, quite a few cars actually became cheaper for us compared to the dollar over the years in India - which is the point of advances in manufacturing and technology - bring down the price of mass-manufactured components so that what was once exclusive becomes more easily attainable.

Have started negotiations for a BMW 330Li M Sport Pro. The first quote received from Infinity Cars offers a 2 Lakh discount on ex- showroom and 50000 discount on BSI + RI (3 years and 40000 kms). My ideal discount range is around 5 Lakhs without the BSI. I am willing to wait till i get the price around my comfort level. Please let me know if anyone recently got a better deal. Will check with Navnit Motors in the coming days.

Cannot agree more lol:

Apart from taxes on individual parts and the final assembled model, Govt makes a killing on registration charges also. Insurance premiums too have gone through the roof. Fuel prices is yet another dampener. Yet another fly in the ointment is the heavy depreciation of these cars from day one. For a lot of people, the car will not even run 1 lac kms in 10 years.

So, all in all, buying a new costly car is like getting hit from every single direction. There is not a single favorable aspect to it as things stand now.

That's an irrelevant comparison unless the person is earning in dollars!!

I was merely pointing out that even under this metric (which I didn't use in my original comparisons), Toyota's pricing has increased where various other cars in the Indian market have actually become cheaper since then.