[sourabhzen]

Article in ET today mentions that the Indian automobile market looks gloomy. An Excerpt:

NEW DELHI: Here's proof that the Indian car market has hit a new low: Maruti Swift is available at a discount for the first time since its launch, and there's no waiting for delivery.

With other top performers such as sports utility vehicles Mahindra XUV500 and Toyota Fortuner, too, now available off the shelf. As rising fuel prices and lack of policy incentives wither away demand, carmakers are now offering highest discounts in several years to push sales, industry insiders say.

"Bookings have come down drastically and there's no real waiting on any model. The market is even worse than December 2000, when car sales had dipped by a massive 40% year on year," a senior marketing executive of an automotive company said. "From 12-15% discounts in the earlier months of this fiscal, many models are available at 20% less than their official price," the person said.

Full article here: http://economictimes.indiatimes.com/...w/19099679.cms

That's true indication of market, IMO

Aslo got a mail from TATA Aria for upto 200,000 discount and 50,000 exchange bonus.

[moralfibre]

Open the news paper today and it is filled with advertisements of cars offered at heavy discounts and tempting offers. Just the other day I read a Maruti Swift advert that read "The Swift now has a new feature: Instant delivery". The VW Vento and the Rapid can be bought by either paying a rupee or by dropping in your old car. The Nano can be bought by swiping your credit card and converting the amount into EMI's for 12 months or the like. Many other manufacturers are following suit with similar offers. And these are not manufacturers like Fiat who were struggling to sell. These are companies like Maruti Suzuki who had a 6-7 month waiting period for the Swift.

It is obvious that people aren't in a mood to spend on cars. The already burdened tax payers cannot think of adding another EMI to their kitty above their home loans.

[sharninder]

And yet there are cars like the XUV and Duster still selling like hot cakes. Something is not right with this country and the dynamics of the car market.

[pganapathy]

You know when a best seller like the swift has immediate delivery that demand has really dropped. It could also be excess supply to be fair, bit when every manufacturer does the same thing it is low demand for sure.

How soon this situation will turn around all depends on two things. Most importantly is growth in the economy with the job market being bad and secondly the government taxation policy. By taxing suv's additionally like PC has done in the latest budget is just bad for business. It only really works with a situation of excess demand.

[gomzi]

Originally Posted by sharninder

And yet there are cars like the XUV and Duster still selling like hot cakes. Something is not right with this country and the dynamics of the car market.

+1 to that. I think market skew is probably due to the undeclared income that many folks have going by the expose on money laundering in few(?) indian banks.

[Nanometer]

The gloom i feel is more to do with more car makers coming into market with more choice , hence there is no monopoly or a single manufacturer contributing to rise in sales or demand. Customer is the King . Yes fuel price rise and general rise in all commodities could be a reason people are more careful on what they spend there money. Govt is not helping either.

[sharninder]

Originally Posted by gomzi

+1 to that. I think market skew is probably due to the undeclared income that many folks have going by the expose on money laundering in few(?) indian banks.

I don't know if it's all black money but the low demand, as far as I can see, is only in the lower segment of the market. The premium cars are still selling. JLR, for example, is selling more cars each month than they ever did. So are Audi and BMW. Merc isn't doing too well but that's their own making.

I guess we're going off topic here, though.

[rajshenoy]

That is exactly what i wanted to say. I dont want to sound politically biased, but the govt has failed in multiple areas.

They could never tackle inflation, Real estate prices shot up(more loan), Interest rates are not coming down, Economy is not looking great(job security) and to top it all fuel prices !!(they are making profit on petrol) and diesel prices will soon catch up too !!
And we pay absurd amount of road tax (Atleast we here in Karnataka are worst )

So in the middle of all this mess, last thing one needs is a spend on a car.

New buyers might look for smaller,cheaper alternatives and those looking to upgrade will want to wait some more time !!

Coming back to auto industry : For whatever reason such as taxation or personal profit, Auto makers have surely overpriced the cars. This needs to change too

To sustain growth in these times, they need to really come up with VFM options which are feature packed, yet do not command a premium

For long, maruti was milking customers by saying biggest bonus they are giving is by delivering the car in X number of months !! That is changing(we see immediate delivery for more models) Next step is they take a hit on profit margins as well.

I would not believe if anyone says automakers are living on thin margins !! they need to introspect their pricing seriously

Originally Posted by moralfibre

Open the news paper today and it is filled with advertisements of cars offered at heavy discounts and tempting offers. Just the other day I read a Maruti Swift advert that read "The Swift now has a new feature: Instant delivery". The VW Vento and the Rapid can be bought by either paying a rupee or by dropping in your old car. The Nano can be bought by swiping your credit card and converting the amount into EMI's for 12 months or the like. Many other manufacturers are following suit with similar offers. And these are not manufacturers like Fiat who were struggling to sell. These are companies like Maruti Suzuki who had a 6-7 month waiting period for the Swift.

It is obvious that people aren't in a mood to spend on cars. The already burdened tax payers cannot think of adding another EMI to their kitty above their home loans.

[rkg]

Originally Posted by sharninder

And yet there are cars like the XUV and Duster still selling like hot cakes. Something is not right with this country and the dynamics of the car market.

XUV too is available off the shelf and discounts are offered ( may be less compared to other cars)

[Nilesh5417]

Gloomy car markets once in a while are good for consumers. Manufacturers finally get their feet back on the ground and people get a chance to buy the vehicle of their choice at reasonable prices.
Sometimes, the manufacturers launch new variants or all new vehicles to boost the sentiment. Which again by me, is a good thing.
So a little bit of gloom can bring in some cheer for the consumers. Why should the manufacturers have all the fun?

Edit : I would also be happy if the traffic stops growing at such a mental rate!

[sajusherief]

Maruti now offers a straightRs5,000 cash corporate discount on Swift that covers its highly sought-after diesel variant and promises instant delivery, the person said. Some dealers too are offering cash discounts on Swift besides up to Rs10,000 off on select variants of the hugely successful Dzire compact sedan in select markets like Bangalore and Mumbai to increase footfalls in the showrooms.

Maruti Suzuki, however, denied any discount on Swift for retail customers. "This is not true. There is no discount for retail customers. There may be offers for certain bulk deals," a company spokesperson said in an email response to ET. "We have consistently ramped up production of Swift to meet customer demand," the person said.

They have mentioned both in the article, which one to believe. My friend who is waiting for his swift for the past 6 months, just called up the showroom and they responded saying "No offer will ever come for swift" !!!

[swiftnfurious]

A very good trend I should say! The auto market definitely needs a price correction. If Maruti is leading it, nothing better. Because of the demand, they (all manufacturers) kept on increasing price at every available opportunity and NOT passing any benefits to the customer. Now they will be forced to.

I was surprised the other day when I took a look at the price charts - I bought my Swift VDi ABS for 5.8L OTR, Kerala in 2008 October and now a Ritz VDi costs 5.9L ex showroom!!

[tez]

Originally Posted by sajusherief

They have mentioned both in the article, which one to believe. My friend who is waiting for his swift for the past 6 months, just called up the showroom and they responded saying "No offer will ever come for swift" !!!

maybe ask your friend to cancel his booking and see the fun...

[supremeBaleno]

It is over-confidence and even arrogance when a seller says "no offer will ever come on so and so car". In 2005 while buying the Baleno, the Honda dealer told me the same when I checked for offers on the City. Just a month later, he SMS-ed an offer of road-tax being free on the City, but I had then already bought the Baleno. At that time almost all the Honda cars were selling well, inspite of being petrol-fuelled cars. See where Honda is today. Swift might be a favourite today, but it does not take long for customer interest to shift, not to mention the other factors in the mix changing like Govt. policies on fuel/cars, competition etc.

Overall car sales is definitely going down, especially at the lower segments, where increase in fuel-price has more impact. It is no joke fuelling at Rs75 per litre to be able to run 12-15kms on non-existing/pot-holed/traffic-jammed roads.

[ARG]

On the other hand, a price correction was long over-due. Let's hope this'll open the floodgates.

While on Swifts, I've been cribbing for some time that the biggest discount I could find in Trivandrum was 25k off on the current OTR on a 2012 ZXI - & that, because I managed to tap into the 'friend of a friend' circuit. :(

I wonder that this news will translate to, in actual discount (including I presume, revised dealer offers).