Team-BHP
(
https://www.team-bhp.com/forum/)
Sharp practice is a pejorative phrase used by lawyers to describe sneaky or cunning behavior that is technically within the rules of the law but borders on being unethical. - source
Dear All,
I am one of the people who has used a Ford product and appreciated the cars performance ( Figo TDCI).
Based on my ownership experice with the Figo and the merits of the new Ecosport, I booked the car the day it was officially launched ( June 26) and put a deposit of 50K
Yesterday, Ford India went ahead and revised the price of the car. This has happened when Ford is yet to clear the bookings of the people who had booked the car even before it was launched. At the time of the launch, the MD of FOrd India had announced that Ford will produce as many cars as the market requires.
Ford has cited increasing costs and Rupee depreciation as a reason. However, they have garnered hundreds of crores in interest free booking amounts. Moreover, to rub salt on our wounds, they will now charge a cancellation fee.
Is this not a sharp practice wherein Ford India has lured in customers by flashing an attractive price, accepted bookings way beyond what they can deliver in a reasonable timeframe, diverted a significant portion of their production to exports and now raised the prices.
Agree with you completely. Of course Manufacturers always have this disclaimer of changing the price without prior notice, but atleast in the case of recently launched Ecosport, even if they decided to increase the price, they should have put some cut off of say first 15000 or 20000 bookings are protected from price hike or pre-bookings are protected. Since Ford could not make enough cars and deliver on time, the waiting customers have to pay this additional price, and cancellation charges !!
Officially there is nothing wrong with Ford increasing the price, it is just about Fair Business Practices.
Unfortunately,this seems to have become the trend in industry off late. Duster, XUV 500 all the same.
I remember cancelling Maruti Swift booking in 2012 after 2 price hikes and now Ford has hiked prices by 5% with no promise on when my car will be delivered. Who knows there may be another price hike a few months from now.
Renault at least offered price protection to those who booked Duster in the earlier days,and I really appreciate them for it. Unfortunately,looks like Ford may not.
The Rupee value falling could have also contributed a lot to this price hike. When the EcoSport was launched the INR value was at 56Rs per $ and now its close to 66Rs, the rupee fall story is no secret.
Any manufacturer is here to do business and this sharp drop in Rupee value can easily kill their margins especially for a non-Indian manufacturer. We should be prepared to see such trend in the market soon from other manufacturers as well is what I think!
We need to be realistic and also understand reasons for price increase. With the rupee taking a beating against the dollar (and probably every other currency out there), it will be hard not just for Ford but other manufacturers as well, to maintain their sell prices when input costs keep increasing.
Cancellations charges (of 3K?), I've understood from many posts where members here announced their bookings, were already mentioned. It's not like Ford decided to charge them 'now', as it's being claimed.
What is agreeable though is that Ford should be honest in not charging 'those customers' whose EcoSports will carry parts already ordered when the dollar wasn't hurting us. That is what they should do, if they're fair and customer centric (but it's anyone's guess what they will)
I never understand the disclaimer put in almost every brand's dealer booking form, mention 'prices prevalent at the time of delivery will be applicable'. But since bookings were done acknowledging this, it's a risk taken by the customer (if anyone were to look from a legal perspective)..
Other manufacturers have also raised prices (Mercedes) and many evaluating to follow suit (VW, Toyota, etc). So this isn't a Ford only issue.
Ford has taken this long to launch the vehicle because basically it was working on very aggressive localization program for the Car. As a result the Ecosport being produced in India is more than 70% locally made. Whatever excess cost they have on account of rupee devaluation is offset to a certain extent with their exports of locally made Ecosport. Global companies like Ford when they do costing of their new product, I am sure they take in to account certain degree of variance due to fluctuation in currencies for a short term (say 3-4 months).
Again this is just a point of view, all the manufacturer are here to do business, and they all have different business ethics.
The Rupee value taking a beating will force most of the manufacturers to increase the prices northwards, agreed.
The case in hand, specific to Ford Ecosport is simply not justified. Firstly you pay a booking amount of 50K. Secondly you don't know when the delivery is going to be. Next you end up losing close to 10% of your booking amount as cancellation fees. Simply ridiculous to say the least.
Above all the manufacturer, may be utilizes the booking amount as an investment, buys parts, assembles the car and starts exporting and makes profit!!!! Isn't it an unfair practice? Should the people who booked paying 50K not get an interest, even if its nominal?
Talking of unethical practice - this one takes the cake.
This is a practice when sales are good the prices tends to go up. Once the sales are down Ford will comeback with Limited editions and discounts as well.
Unfortunately, this had to come sooner or later because of the pathetic state of the INR. Almost every other commodity is going to face price correction northwards.
The only thing which is difficult to digest is that those who pre-booked the car also have to bear the price rise. The least Ford could come up with is, the same price for those who booked before a particular date.
This is not a Ford issue, everyone will do it sooner or later. It is the popularity of the car which is causing the back lash. If this was an Evalia or a Sail or any other so so car, nobody would have even noticed.
I cancelled my booking much before the price hike and I knew the 3000 Rs penalty because it was clearly mentioned at time of delivery.
Regarding the actual price hike, it will be difficult for people , this I whole heartedly agree. 50,000 over budget is no joke. But now it will come down to how much value you see in this car at the new price.
One last thing- Ford sorry to say but this was a low blow to people who paid in so long ago. FORD could have gone for say 50 50 hike with existing bookees or something similar. Brand loyalty would have touched the roof.
Like Prafful_Rathod wrote; that manufacturers add a disclaimer of adjusting prices later on , what i do not appreciate at all is the cancellation amount - its a double whammy for the consumer
From what I know, Renault had done a major price hike on the Duster a few months after launch. However. they did offer price protection to customers who had already booked and whose delivery were delayed - something that went a long way in building goodwill.
I think it is clear that "booking" happens when a price (between buyer and seller) has been established.
In case of seller's side price revision, there is simply no justification to a "booking cancellation charges".
A buyer and seller had agreed upon a certain price that was established earlier, and that lead to the booking. Let's say if it was available off the self, the payment and delivery would've completed there and then.
It would be very good gesture on Ford's part to refund the entire booking amount to those opting to cancel their bookings. They could salvage a lot of goodwill. In any case, they would have earned good interest income with so many bookings.
I think it is the falling rupee that is killing them.
However, this is certainly not a desirable business practice.
While I accept their absolute right to change the prices at any time, they should have had the common decency to offer consumers wishing to opt out of their bookings, their money back without levying any kind of cancellation fee. Demanding a cancellation fee in a scenario of this kind is simply cheap and niggardly behaviour on the part of that big American MultiNational.
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