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Old 27th April 2018, 13:29   #46
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Default Re: Overpriced cars : Myth or reality?

So, that one quickly digressed into a discussion of countries and taxation.

One point I thought that was not discussed, is the way manufacturers are helped by technology growth all around.

Not pointing exactly, but trying to bring back the Premier for 2L in early 90s with the inflation adjusted to today's time.
Premier for 2L would include some costs of that era like high price for things as simple as computers and printers. Printing and maintaining invoices would cost many times more in absolute terms compared to today. So would a whole lot of office and operations management, in that era.
Obviously the growth in communication and computing technology has helped everybody including manufacturers, not to mention the ease handling logistics and supply chain with technology.
When arriving at fair price with inflation adjustment, one must take these aspects into consideration.
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Old 27th April 2018, 13:34   #47
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Originally Posted by rdst_1 View Post
Your point definitely makes sense.
However you have to see things from other people's perspective as well.
Most of the salaried class has every right to crib about these taxes as they don't get much in return for what they pay.
The bitching and moaning about taxation and not getting enough return for what they pay is an universal theme. Just about in any country anywhere in the world, irrespective of the tax levies people will bitch and moan that they are not getting enough for their taxes.

But bitching and moaning doesnít get you anywhere, although admittedly it can be very pleasant to do so.

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Originally Posted by ashlil View Post
Not really the only option, is it? There are several options like

1) Migrate (changes nothing)
2) Stay here and bitch and moan (Very important right in a democracy. In fact this brings in change)
3) Take active steps to change things you do not like (Form a political party, put hoardings).

So, why migrate? Why not bitching and moaning?
By all means do. But I donít agree bitching and moaning brings change. Not the sort of bitching and moaning we are discussing here. Itís always the people that are willing to actually do something that drive change, not the fairly large group of individuals that just criticises and list out what is wrong, but doesnít do anything. Unfortunately, or maybe even remarkably, in democracies that tends to be a fairly large group!


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By your logic nobody should complain of pain from cancer unless they know the cure. And also how far an individual can be removed is not your call, nor your right.
When you get to my age you have seen a lot of family and friends battle with cancer. And I use the word battle here specifically. Because yes they curse, bitch and moan, each in itís own way. But each case I have been familiar and close with the individual also put up a hell of fight to try and get better, or to stabilise the disease and find ways to make the most of their life, one way or the other. Every single one did that in his/her unique way, but I have yet to see somebody who does absolutely nothing and only bitches and moans. Only towards the very end people might give in and just let the disease take itís course. That is where acceptance of the final ends sets in,

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Please understand that it is not the responsibility/duty of other people to improve your patience.
Never said it is.

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Originally Posted by ashlil View Post
You can criticize their perceived selfish ways, but you cannot hold them responsible for your lack of patience.
Never said I do. I just move on and away from those folks. They do not need to do anything. Iím highly self propelled and self motivated. Just short on patience.

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Originally Posted by ashlil View Post
Very narrow characterization of democracy.
Never said it was, your interpretation.

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Originally Posted by ashlil View Post
A broader characterization of democracy would be the right to bitch and moan openly without the fear of being persecuted (a right, you seem to disapprove).
I would be cautious of trying to characterise democracy in one liners. A one liner such as mine and yours for that matter, illustrates one element of democracy in my thinking, not what democracy is.

I donít disapprove of people bitching and moaning. I disapprove of individuals ONLY bitching and moaning without offering solutions. (or completely unrealistic solutions). But I will defend their right to bitch and moan as much as they do always. I am a liberal at heart and as Ron White said, you canít cure stupid!

Some good old bitching and moaning on anything is probably very good now and then. But at some point in time you need to stop, accept it and move on, or do something about it.

So that is why I have decided to start a career in the public sector next to my day job. Iím joining a local social-liberal political party and might run in the next local elections. So no bitching and moaning about what is wrong with how our council is run, Iím going to try and step in and drive change.

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Old 27th April 2018, 13:56   #48
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Originally Posted by Jeroen View Post

-SNIP-
You, sir, have completely missed the point. Through all your self-righteous sermons, you have been only bitching and moaning about people who bitch and moan without offering any solution to bitching and moaning (other than removing such people to a far away land, which is not really a solution). Isn't it time you accept that people have a genuine right (even need) to bitch and moan and move on? (Isn't that your exact advise?).

(Also, please stop assuming that other people have not attained your age or have not seen their family and friends battle with cancer.)

Anyway, enough of off-topic. I think this thread was originally aimed to discuss overpriced Indian cars and let it be that. I apologize to the members for having contributed to the off-topic discussion.
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Old 27th April 2018, 14:10   #49
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Default Re: Overpriced cars : Myth or reality?

Car pricing & its fairness - a subset of the topic "cost of living & its fairness".
Bound inevitably to veer towards a debate on taxation.

In this world adorned by cruel inhuman deeds like adulterated food, adulterated medicines, kidnapping children and mutilating them by begging mafia, someone swindling money from another is the least of all evils. We must remember to treat this topic with the right sort of importance and perspective it deserves, and not more than that. The entire world ticks along by every man proving himself smarter than the other, in one way or another - thats the real fundamental force driving any business. Denying this fundamental fact is not going to change the truth.

So lets stick to the actual topic which deserves only a debate of "perceived quality" v "actual quality" v "perceived cost" v "actual cost" and not retort to a game of one-upmanship trying to prove one world view vs another world view.
Humble request, in the interest of keeping the standards sought by forum rules.
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Old 27th April 2018, 14:11   #50
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I think currency fluctuations too impact the car prices in Indian Rupees. Many cars have locally sourced parts but there are still many components which are imported. If the currency depreciates, then definitely there would be an upward pressure on car prices and if the company cannot absorb the rise, it will be forced to pass on the rise to the consumers.

However, cars today are better knitted and offer many features even in the entry level which were earlier offered only in the luxury segment earlier. In 2002, MSIL did not provide front passenger side mirror for Zen Lxi version which was its flagship seller and its breaks were nothing to write about. Cars of today offer more comfort and better safety as compared to previous ones.
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Old 27th April 2018, 14:14   #51
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What an interesting thread!

I've always felt that cars were overpriced in India - but are things really that bad?

We purchased a Honda City 1.5 EXI for approx 9L on-road BLR in April 2000 (add another 20-30k for what we thought then to be seriously overpriced accessories)

We got a cracker of a 100 BHP engine, all-round power windows, power side mirrors, air-con, pwr steering, cloth seats, cassette player + 4 speakers, 175 size tyres on 13" rims.

sun-film, remote central locking, side-step garnish, woody gearknob , rubber anti-slip mat on the dashboard and thicker floor mats were added. (The quality of the HONDA OEM accessories have stood the test of time over 18 years).

The 106 BHP VTEC launched a little later got a rear spoiler, lovely Enkei alloy wheels, alpine music system and leather wrapped steering wheel for what I think was 10.6 L on-road

The 4th Gen Honda City 1.5 Petrol VMT sold today costs 11.84 on-road BLR - but I think with discounts can be had for 11.5 L on-road.
The car could be had for approx 11L before the GST hike.

This car now makes 117 BHP and comes with ABS EBD, Dual Front Airbags, cruise control, power steering, power windows and mirrors with autofold, steering mounted controls, 15" alloy wheels, remote central locking, stop start button, 8 speakers, rear camera and fog lights. This car is probably 20 percent larger on the inside as well compared to the 2000 model.

18 years later - I dont think this is such a bad deal - I still have my 18 year old City but got to drive my friends brand new City VAT and the car felt superb - sure Honda has gone a bit downmarket in quality but this is still a very good car with a lot more features, safety, comfort and performance.

My bigger issue compared to price is auto manufacturers palming off the same engine and gearbox with minor modifications over successive generations of car.

The 3rd gen Swift I think has basically the same engine and gearbox as the 1st gen, the new Amaze uses the old 1.2L petrol as does the current City which uses the previous gen 1.5L with some changes.

While cars in India have gotten a lot safer and more comfortable - the increase in performance hasn't been commensurate.

The 2000 model City 1.5 EXI clocked 0-100 kmph in 11 seconds (If I recall this correctly).

Ideally after almost 20 years - cars in this category (now 12L to 17L on-road) should ideally have delivered sub-10 second times - which I dont think is the case.

Even in hatchback, the Palio 1.6 S10 from that era would offer performance comparable to today's hot hatches.
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Old 27th April 2018, 14:16   #52
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Originally Posted by Jaggu View Post
Hard reality almost all the cars that are out there in the Indian market are over priced,
Completely agree with this point. I feel it has more to do with the immature mindset of the mass which still thinks pricing decides the quality. Premium factor depends more on the brand and the price in Indian market rather than the deciding on what the product has to offer.

Previously I owned Tata Nano and I must say no car can offer its peppiness in the city but sadly low pricing factor alone killed the brand. People not even considered to try that completely practical car and instead expected a Mercedes for the bucks they have spent on Tata.

Recently a cab driver was enquiring about my new Tata Nexon and as usual upon looking Tata logo the first question was how much did I pay for the car? When told that it cost 10.5 lakhs on road I was able see the sense of disapproval in his face. It was like why spend so much on Tata? Finally, he couldn't control advising me that Tata cars won't have resell value. I had to answer him that I am least bothered about it.

This was just an example how everything in the Indian car market is being decided upon price, mileage and resell value.
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Old 27th April 2018, 14:52   #53
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Isn't car pricing a carefully executed game?

Let me talk about the B segment hatches as far as I remember.

Back in 2005, I remember going to the local Maruti showroom and seeing an Esteem and the brand new Swift! The Swift back then was a revelation if I remember correctly. It had ABS, airbags and climate control-features I'm hearing for the first time. It was actually a premium offering- the ZXi back then costed around 5 lakhs while the Esteem was in the high 4's! Yes a proper Sedan for less than 5 lakhs!

No questions asked but the Swift was a runaway hit! The Hyundai Getz was launched few months later and that was a classic flop for reasons I don't remember. It was priced slightly premium and had more space!

I really don't know why the Swift clicked in a sedan obsessed country!

Come to 2007 and the Swift diesel was in consideration. The VDI version retained at over 5.5 lakhs and was a bit expensive back then! The ZXi was over 6!

2008 saw the Hyundai i20 launch. It was never expected to be sold and was only an export model. The Asta variant was over 6.7 lakhs. Let's not forget the Skoda Fabia too. It was also in a similar price range. I remember looking at the features list in ACI back then and seeing all the green ticks and being awed!

2009 was the year of drama and serious price rise! The Honda Jazz turned up with an 8 lakh price tag. The Hyundai i20 diesel was launched and was less than 8 lakhs. All thanks to Honda, buyers minds were completely changed and the i20 was seen as VFM! We bought it within one month of launch and was thoroughly enjoying the power delivery of that Hyundai 1.4l diesel! Deep inside there were fears that we may have overpaid for a possible market dud. Sales charts proved otherwise and within 3 years there was a serious price correction with the new launch of the Swift in 2011. It costed 7-8 lakhs for the diesel. Soon the regular pricing of that segment was 7-8 lakhs! With the all new i20, the range is now closer to 9-10 lakhs!

I can go on talking about the C- segment too. But then the post will become seriously long.

I'll conclude by saying that

1) Price rise is directly related to market prices

2) Customer perception on pricing is highly relative and is the biggest leverage manufacturers have on us. Last month Honda City was overpriced. Today it's VFM. Tomorrow you'll see a new variant with extra features at a higher price in order to comfortably bring the new generation without a big price rise!

3) The biggest gainers are manufactures selling long term cycle products- VW! The current Vento Highline was sold for 11 lakhs on road in 2014 albeit with less features! Today it's 16 lakhs! All thanks to the crazy competition.
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Old 27th April 2018, 15:20   #54
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So government is the new touch-me-not - like religion - that should never be spoken against. One should not even point out that cars are overpriced due to taxation even though half of the price you pay goes to the government as taxes. You automatically earn the tag of the ant-national who should leave the country.

Let me mouth the cliche that every libertarian should repeat. Taxation is theft. No matter however you try to rationalise it, I did not sign up to pay the ransom that makes me eligible to stay in the country. Any money taken from me without my consent is theft, and am not even getting into the issue of how it is being spent.

Getting back to the point, taxes have grown leaps and bounds from the days when a Maruti 800 used cost 2L rupees. Today we pay 20% of the ex showroom price in road tax when a couple of decades ago it was less than 5%. What has changed between these years?
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Old 27th April 2018, 15:44   #55
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Quote:
Originally Posted by ashlil View Post
you, sir, have completely missed the point. Through all your self-righteous sermons, you have been only bitching and moaning about people who bitch and moan without offering any solution to bitching and moaning (other than removing such people to a far away land, which is not really a solution). Isn't it time you accept that people have a genuine right (even need) to bitch and moan and move on? (Isn't that your exact advise?).

.
You might not think immigrating is a good solution to get away from taxes but literally tens of thousand of people have immigrated for that very purpose. Visit our thread on emigrating and you will find many enlightening example along similar lines. People used to immigrate from the Netherlands to Belgium for no other reason they were getting substantial lower taxes and better schools for their kids. So it is a very real and well tried and proven solution.

I have also eluded to if you want to have lower taxes on say cars, you are likely to have to accept an increase somewhere else. There are plenty of things you can do as long as you are prepared to make some concessions.

I am part of an action/lobby group that is busy trying to amend the tax rules on classic cars. The current regime I find ridiculous, so I bitched and moaned a bit on the internet. I moan and then I roll up my sleeves, find other like minded and start driving this need for change. We have been at it for well over 6-7 years. With limited success. Some small positive changes. But with our current government we believe we can probably work something out. Fingers crossed.

In democracies there is a saying. If you are not at the dinner table, you are the dinner. That is the pitfall for people who only bitch and moan. Others might rise to the challenge and drive the change they see fit. If you don't engage you are not very likely to find the outcome to your liking. More to bitch and moan about.

Again, I have never said people don't have the right to bitch and moan. All I said it isn't going to get you unaware and it is unlikely to drive change. Either start doing something about it or accept it and move on.

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Originally Posted by ashlil View Post

(Also, please stop assuming that other people have not attained your age or have not seen their family and friends battle with cancer.)



.

I don't assume anything. I have no reason to assume anything. It is a demographic fact that as you get older more near and dear will pass away. Not my opinion, just how it works in most countries with a reasonable stable society (i.e. no wars etc).

Cancer is in some countries already number 1, or becoming the number 1 cause of death in quite a few countries. So as you age the number of people near and dear to you, which will experience one form of cancer or the other is increasing. They are very likely to bitch and moan, but as I pointed out, most will find solutions that make their life as fruit-full, meaningful as they can possibly make it. Whatever that solution might be.

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Old 27th April 2018, 15:46   #56
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Manufactures are raising prices of cars by a lakh with each iteration with only minor addition in features and absolutely no change in driving dynamics, ride & handling, safety or engine capacity. There maybe a few exceptions to this but this I mention from the trends I have observed over the past few years. I bought a Linea TJet top end Emotion variant less than 3 years back and with discounts the on-road in Chennai was less than 10 lakhs on-road. The Linea is a driver's delight with good ride and handling, steering feedback, safety and turbo petrol engine. If I take sedans from the same segment into consideration, the City, Verna, Vento and Rapid (top end variants petrol sedans only) were in the similar price range or maybe 50K to a lakh above the price of Linea. The current prices of City, Vento, Yaris on-road are hovering above the 13-15 lakh mark price range for top end petrol which is already a good 3-5 lakhs above what I spent less than 3 years back. Assuming I have my Linea for 6-7 years which is a like 4 years from now, the prices of top end petrol sedans in the C segment will be very high and in the range of D segment sedans currently. So if and when I am planning for a upgrade a few years down the line, I would basically get a C segment sedan at a 1.5 to 1.8 times the price of my current car with maybe the same engine as today albeit with more fancy features most of which I will not have much use for. So what would seem like an upgrade from C segment sedan to a D segment sedan would be only within same segment due to the car manufacturers overpricing with new launch every year. And for this very reason I plan to keep the Linea for 10 years hoping I get the service and spares through Jeep Service centres.

Last edited by whencut86 : 27th April 2018 at 15:51.
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Old 27th April 2018, 15:52   #57
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Originally Posted by ashokrajagopal View Post
Obviously the growth in communication and computing technology has helped everybody including manufacturers, not to mention the ease handling logistics and supply chain with technology.
When arriving at fair price with inflation adjustment, one must take these aspects into consideration.
Great point ashokrajgopal. Actually in real terms the prices of many items have fallen over the years - cars being a case in point. Computers, telecommunications, white good appliances, air travel, electronic appliances, even low end clothing - all have become cheaper over time. Which is at least partly why larger swathes of the population can afford them. Some other items have become more expensive - children's education, housing in the 4 or 5 biggest cities being examples. Some others are in an inverse situation where the rich get it almost free while the urban poor pay by the bucket - fresh water in urban areas.

If this were a discussion on whether wheat is overpriced the arguments would go something like this --- the farmer would say that the Govt's support price is never high enough, never ever; the housewife will say it is expensive regardless of the price point; the mandi trader will say who cares I am going to make my margin either way; the middle class will cry hoarse; the poor will shrug their shoulders and suffer in silence. Fortunately this is a debate on cars and not food.
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Old 27th April 2018, 16:10   #58
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Default Re: Overpriced cars : Myth or reality?

In my view, cars are definitely overpriced.

Back in 2005, we bought Baleno VXi (top end variant was VXi) sedan and for Rs. 8 Lakh on Road, we got a fantastic 1.6 litre G16 engine, a rattle free build, height adjustable seat belts, all round independent suspension and a rear bumper which was not as flush fitting as today's compact cars (bumper was first to take hit before bootlid was impacted, and it was solidly built, I could stand on it @ 86Kg), intermittent wiper adjustment, all 5 alloy wheels. For its time, car was amazing. And AC was a chiller one (scroll compress was used at that time).

In 2015, when I was hunting for a new car to replace my problematic 2014 grand i10 diesel, Dzire VXi was aruond 8 lakhs on road IIRC. A 1.2 litre K12 engine which cant be compared with G16, less space, not exactly rattle free as much as Baleno, and an inconvenient rear seat. We are not even comparing ride quality and handling. So in one decade, the same amount of money could fetch middle trim of a car full one segment below the 2005 levels. Third generation Swift VXi doesn't get adjustable rear headrests, but Wagon R Lxi gets them.

Our 1992 Maruti 800 had adjustable front headrests and a proper steel back for rear seat. Current generation Alto simply cannot match the comfort of front seats offered by our family's first car.

Prices have shot through the roof in my opinion while we still dont get enough of product. Almost all cars below Rs. 10-12 lakh have non independent rear suspension (Indica family is exception) whereas even humble old Esteem had all round independent suspension. Rs. 10 lakh is new 4-5 lakh. And Rs. 15-17 lakh is new Rs. 10 lakh.

While cars offer more safety, they are not necessarily better in other parameters. Govt taxes could be partially blamed too for overpricing. Coming back to safety, few cars sold in India fared horribly when subjected to crash tests. So safety has only improved from previous products on sale in India, but not yet at par with International standards. So not only do we pay more, but we also get safety features. Swift in India gets more sales than EU, but we still dont have 6 airbags even in top trim.

Somehow, I feel we are shortchanged in engine/performance and safety domains whilst cars are getting costlier.

PS: Dont get me wrong on K12, its an excellent motor, probably the best 1.2 litre NA mill right now on sale in India. But G16 was altogether a different experience, better than K12.
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Old 27th April 2018, 17:32   #59
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Default Re: Overpriced cars : Myth or reality?

I think this thread is fixated on prices without accounting for inflation. My classmate had an E270 about a decade ago that he paid 45 lakhs for, today the superior long wheelbase version costs 80 lakhs. Both prices are OTR, the inflation in the time period was 140%, a new one would cost 1.08 crore if prices had stayed at the same level.

Newer cars are better, safer and cheaper, reliability has improved drastically in the last twenty years. The only reason why cars seem expensive is that inflation has made us poorer, other than the GM SAIL cars, most launches improved on the existing model.
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Old 27th April 2018, 22:08   #60
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Originally Posted by aaggoswami View Post
In my view, cars are definitely overpriced.

Back in 2005, we bought Baleno VXi (top end variant was VXi) sedan and for Rs. 8 Lakh on Road, we got a fantastic 1.6 litre G16 engine, a rattle free build, height adjustable seat belts, all round independent suspension and a rear bumper which was not as flush fitting as today's compact cars (bumper was first to take hit before bootlid was impacted, and it was solidly built, I could stand on it @ 86Kg), intermittent wiper adjustment, all 5 alloy wheels. For its time, car was amazing. And AC was a chiller one (scroll compress was used at that time).

In 2015, when I was hunting for a new car to replace my problematic 2014 grand i10 diesel, Dzire VXi was aruond 8 lakhs on road IIRC. A 1.2 litre K12 engine which cant be compared with G16, less space, not exactly rattle free as much as Baleno, and an inconvenient rear seat. We are not even comparing ride quality and handling. So in one decade, the same amount of money could fetch middle trim of a car full one segment below the 2005 levels. Third generation Swift VXi doesn't get adjustable rear headrests, but Wagon R Lxi gets them.

Our 1992 Maruti 800 had adjustable front headrests and a proper steel back for rear seat. Current generation Alto simply cannot match the comfort of front seats offered by our family's first car.

Prices have shot through the roof in my opinion while we still dont get enough of product. Almost all cars below Rs. 10-12 lakh have non independent rear suspension (Indica family is exception) whereas even humble old Esteem had all round independent suspension. Rs. 10 lakh is new 4-5 lakh. And Rs. 15-17 lakh is new Rs. 10 lakh.

While cars offer more safety, they are not necessarily better in other parameters. Govt taxes could be partially blamed too for overpricing. Coming back to safety, few cars sold in India fared horribly when subjected to crash tests. So safety has only improved from previous products on sale in India, but not yet at par with International standards. So not only do we pay more, but we also get safety features. Swift in India gets more sales than EU, but we still dont have 6 airbags even in top trim.

Somehow, I feel we are shortchanged in engine/performance and safety domains whilst cars are getting costlier.

PS: Dont get me wrong on K12, its an excellent motor, probably the best 1.2 litre NA mill right now on sale in India. But G16 was altogether a different experience, better than K12.
I 100% agree to your comparison to Esteem and Baleno of the past. I still have my Esteem and as you said the only car's with rear independent suspension's are in the 15-20 Lakhs bracket now. It's much better to hold on to your older car's as that's more value for money in my opinion.
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