[dZired]

Hyundai India has stopped levying handling charges from new car buyers across the country after a two-year long legal battle with a Hyderabad-based techie. Interestingly, the Supreme Court has already issued a directive that advises dealers to not charge anything over and above the required fee to register the vehicle (related link). Contrary to the apex court's order, new car dealers have often been seen adding handling charges to the bill of unsuspecting customers.

A similar case of levying additional charges was reported in Hyderabad when Mr. Ratan Grandhi, an IT professional, was forced to pay Rs. 6,950 as handling charges before taking delivery of his Hyundai Xcent on December 17, 2014. However, Mr. Grandhi decided to bring the dealer's illegal practice in notice of higher authorities of Hyundai India. He sent out a series of e-mails to the automaker, but didn't receive a satisfactory response.

Mr. Grandhi then registered a complaint with the Joint Traffic Commissioner (JTC). In an official enquiry, headed by Central Zone Road Transport Officer (RTO), the officials found the additional charges to be illegal and warned all dealerships to not indulge in such malpractices. They even suspended licenses of two showrooms for similar cases. Hyderabad's Joint Traffic Commissioner (JTC) has also advised potential customers to lodge a complaint in case they come across any dealership levying such handling charges.

Meanwhile, Hyundai has issued official circulars to all its dealerships across the country, scrapping handling charges on its new cars.

Source: Deccan Chronicle

[sidhu_hs]

Hyderabad BHPians need to felicitate this guy. Maybe conduct an interview. And give him an honorary membership as well!

[Screwdriva]

Well done Ratan! Hyundai is by no means a poster child for good business practice in India.

Recently, I noticed that they claimed to offer a 4 year extended warranty on the Creta at Pramukh Hyundai's dealer materials. After booking my diesel, they informed me that the 4th year was available only for the petrol.


Guess who just cancelled their booking?

[Ruchitya]

As I'm in the market for a new car, have been enquiring about handling charges with a few dealers here in Bangalore. There is an amount <1000 shown as handling charges. But not the ₹7000 that was seen earlier. There was one Honda dealer who clubbed handling and road tax into a single column. Make sure you ask about the detailed break-up of prices, to ensure the few thousands have not been presented as some other expense.

[MDED]

This is brilliant news. On this forum there had been numerous discussions regarding illegal handling charges levied by the dealers.

During my car search in late 2015 and early 2016 I was considering lot of cars and had shot mails to Ford, Hyundai and Honda regarding the additional handling charges. Ford was the only one wherein they responded on email mentioning that their dealer will call and confirm regarding waiver of charges. Haggling with Honda did not yield anything and I was forced to pay handling charge.

IMO most of the dealers will mention this charge under registration and other miscellaneous charges and some dealers will mention under the handling charges column.

Since, I work at a PSB and lot of customers taking car loan from me, I advise them on bargaining with the dealers and with this verdict I am emboldened and will spread the word.

I liked the idea of felicitating Mr Ratan.

[centaur]

Kudos to the guy but unfortunately every dealer does this openly. I too had paid this while buying my car. However, one fine day something struck me out of the blue and I just removed the original invoice to see the handling charges on it.

Immediately emailed Hyundai asking them for an explanation and they promptly diverted my query to the dealer I had purchased from. I got a reply saying "Sir every dealer charges this". I replied saying I do not give a damn about other dealers as I had purchased the car from them and they need to refund the money. I attached some news article links of the judgement from SC and mentioned that this is illegal by the supreme legal authority in the country and if they are not willing to refund, I am willing to take them to court.

Some amount (majority) gets refunded and as a goodwill I went ahead and purchased an extended warranty from them which was introduced later and was not available when I purchased the car.

The point is that many people end up paying this without knowing or after knowing but not wanting to get into a hassle. Now the question is, what if the dealer cleverly masks this amount under some other charges?

[Coplay]

So is this new SC directive applicable only to Hyundai or can buyers like us use this to negotiate with all other dealers who charge this illegal fee.

[A M]

Originally Posted by Coplay

So is this new SC directive applicable only to Hyundai or can buyers like us use this to negotiate with all other dealers who charge this illegal fee.

In such cases, Supreme court orders are always generalized and will be applicable to all auto dealerships (2 wheelers, 4 wheelers).

[amit.s]

To make up for this loss, car dealership will become more forceful with bundling extra accessories, inflated insurance premiums etc.

[AtheK]

Good stuff, but as other pointed that it will be good to make sure it is not passed on to unsuspecting customer in any another way.

In a bit unrelated news "In the recent hearing when Government clarified that paying Service charge is on discretion of customer, i have seen restaurants put a disclaimer saying that they will levy SC, and if you do not agree, they are happy of your decision to dine some place else"

This practice might just creep down with car dealers too, after all, this excess money was basically the profit they were making per car sold, which i guess will be easily running in lakhs (for some one like Maruti or Hyundai dealer).

[promit]

We bought a Creta in October 2016. The price quote and final price paid did not have a handling charge. It was not there on the pricelist. Dealer is Safdarjang Hyundai, Gurgaon.

[MDED]

Originally Posted by amit.s

To make up for this loss, car dealership will become more forceful with bundling extra accessories, inflated insurance premiums etc.

During the last purchase of my car I opted insurance online rather than going through dealer and with NCB transfer from the old insurance policy I saved solid 3000 rupees. So let the dealers inflate whatever, they can't decimate your spirit.

[Whiplash7]

A small fee less than 1000 is alright in my opinion, I believe the handling charges are for taking your vehicle to the RTO and getting it registered which involves fuel, people and some effort

[swiftnfurious]

Originally Posted by Whiplash7

A small fee less than 1000 is alright in my opinion, I believe the handling charges are for taking your vehicle to the RTO and getting it registered which involves fuel, people and some effort

A major portion of the handling charges go as bribe to the RTO officials. Even before the handling charges started, dealers were doing all these, so what's new in that? On the other hand, what are they bribed for, when registering a new vehicle? Everything is followed as per the rules, so they are making some quick bucks at the cost of the customer for nothing.

If they don't want to spend on fuel and get the registration done, let them stop it and hand over the same to the customers. That's how it's done in Kerala. The RTO guys would force you to come through the agents, which is a different matter, but if you hold your ground, they have no choice but to do it without taking bribe.

[prateekvidya]

This is great news indeed ! The problem of course always was awareness, and despite this ruling hitting the media, many people would still be paying these charges, or the dealers would find smart ways to conceal them.

The origin of this is actually the margin of the dealer itself - in a highly competitive environment, this is their way of making money (not by any means the right thing to do though). Handling charges, insurance and other charges (often to enable registration and load accessories) are the biggest margin making items for dealers.

I also suppose that car makers should take an initiative to audit these dealers for what they are doing with customers - at the end of the day, Hyundai's name is getting spoiled here for no reason. Besides, cars should come equipped with floor mats, mud flaps, anti-rust coatings and other tiny basics for which customers are often skimmed off.