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Old 6th August 2019, 09:27   #16
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Default Re: The great Indian automobile industry slowdown of 2018-19

Audi puts India investments on hold.

Rahil Ansari:
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For the overall volumes that we sold last year — 6,463 units — it does not do justice to make commitments on further investments
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We will catch up in the second half of the year but overall, I don’t think there will be a positive development within this year
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For a luxury car, with the amount of taxes you pay in India, you are paying a lot of money
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And the development cost of BS VI will also have an impact on the price. It cannot be absorbed by the manufacturer. I doubt the willingness of the customer to pay more
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Old 6th August 2019, 09:54   #17
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Default Re: The great Indian automobile industry slowdown of 2018-19

The real reason for slowdown is tighter lending norms by NBFC after the ILFS bust.

NBFC controls nearly 65% of 2W financing and 30% of car financing. Currently there is severe liquidity crunch and worse for people with lower credit scores. Even the used car/2w market is reeling under very high pressure.

its the finance that sells a car/2w and not the car that sells.

https://www.thehindubusinessline.com...le28814259.ece
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Old 6th August 2019, 16:30   #18
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Default Re: The great Indian automobile industry slowdown of 2018-19

I love cars but slowly and surely the desire to buy better , faster , bigger cars is fading away. It's mainly due to scarcity of parking space in Mumbai. These days rarely the residential societies offer good parking place. Stacked parking or mechanical parking is a complete torture. Most homes now come with only 1 car park irrespective of the cost and carpet area of a 2 bhk flat in Mumbai's residential locality like Matunga / Mahim / Dadar The roads are congested , bad , also too many two wheelers riding their fast machines mindlessly. There are many turn offs than ever. :-(
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Old 6th August 2019, 16:53   #19
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Default Re: The great Indian automobile industry slowdown of 2018-19

I am a small contributor to the slowdown in many ways.

1. 8 years back when I was in the market for a new car - went to the VW showroom to buy the POLO - but looking at the EMIs, went next door to a used car showroom and bought a preowned Chevy Aveo.

2. Drove the Aveo for 2-3 years and went to the Honda showroom to buy the City - again calculated the EMIs and monthly outflow, and in a couple of months bought a 2.5 years old SX4 VDI from a known contact (pure luck). The car is still with me and drives like a dream with almost 90k kms clocked.

In the last 2-3 months, have given up driving completely due to the metro construction in Mumbai, and coupled with the nightmare of congestion at toll nakas in Airoli and Mulund. I dont think I will be in the market for a car in the near future till I am forced to scrap or sell the SX4.

For meetings its either Ola/Uber or the office car.

The positive side effect is, I can work extended hours without worrying about the growing traffic after 6 PM.
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Old 6th August 2019, 17:35   #20
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This is very much becoming the norm to many in recent days in large cities where commuting is becoming more tiring & very torturing. Many thought AMT & AT are good to go for to avoid fatigue of clutch- brake - gas pedal combinations in heavy stop-go traffic. But clearly, still the issue of coming extremely close to other vehicles and causing quite unsafe maneuvers becoming normal.

Here in Pune, jam packed 2 lane roads quickly becoming 4 and sometimes even 6 lanes (forget pedestrians, they don't deserve a space) and then what a chaotic convergence when the roads become strictly 2 lane when it merges with flyovers or shops on the sides. Coupled with that sense, freshly joining workforce shunning the cars as well due to exorbitant acquisition cost and liabilities of maintaining that thereafter.

The current slowdown is also the death of rural euphoria, as the election cash machines dead now, there's not much happening in rural markets of India. Lots of small time businesses are already gone away or dying. There's no revival in sight, the liquidity crunch hits villages much harder that urban areas. There have been numerous news articles on drought to floods and loan waivers. Fundamental issues are not addressed and people need to trade, jobs and ultimately credit availability is a big issue. Surprisingly, this has direct linkage with both Pass Car and Utility vehicles.

In Summary: Urban India is not very enthused (at least the masses) as they were for some decades in aspiring to own a vehicle

Rural India is confused and looking up every small promise from entitled to turn it around. Forget vehicles, livelihood is not flourishing!
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Old 6th August 2019, 20:22   #21
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Originally Posted by Pam81 View Post
Rural India is confused and looking up every small promise from entitled to turn it around. Forget vehicles, livelihood is not flourishing!
I live in the rural and there's no economy troubles- at least in my part of the country. Everyone surfs a lot, thanks to Jio and discussions are about the range of EVs.

Most of us have decided to hold on to the current diesel for long drives/family trips and will buy a compact EV for daily driving.
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Old 6th August 2019, 21:03   #22
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I live in the rural and there's no economy troubles- at least in my part of the country.
You must have been blessed. It's a pity to see that some villages not so distant from Pune still not having a reliable electricity facility available all day. Of course, there are some places like Kohlapur and proxy rural locations that thrives on Mercs. Let's leave those well to do. Localities where Alto, Maximo, Bolero sells are of concern since business prospects are dwindling which drives down the need of vehicles. That's my point and the slump on sales reflects the same to some good extent on rural contribution to overall sales.

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Originally Posted by ramzsys View Post
Everyone surfs a lot, thanks to Jio and discussions are about the range of EVs.

Most of us have decided to hold on to the current diesel for long drives/family trips and will buy a compact EV for daily driving.
For sure, people are informative and heavily accessible to information. No doubt, it does make sense to have EVs in a rural setting when sales & service available. I do not know why Mahindra E2O is still not a very welcoming thing in rural, may be still doubts on serviceability / access to service within reasonable distance. In any case, it's a dream to become real at some point in future. Not sure when & how! Too many conflicting industry articles / publications on ICE to EV switch-over timelines.
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Old 7th August 2019, 07:37   #23
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Localities where Alto, Maximo, Bolero sells are of concern since business prospects are dwindling which drives down the need of vehicles.
Yes, add to them the Eeco and the omni.

Let's take a mid size farmer who earned 5-10L per annum and bought a Bolero, @ 6 lakh on road in 2007 (it is now almost 10L). If he is wanting an 'upgrade'- it all costs triple of what he invested 10 years back.

Of course, inflation is part and parcel of life; but rural income growth rate is either stuck or stagnating at 3-5% per annum; an urban customer who earned 5L in 2007 is now at 15-25L levels. (which is the main cause of migration anyway).

Happy monsoon year or otherwise, cars(that are seen as an upgrade) are priced out of the rural buyer. We don't buy in EMIs, because farming doesn't guarantee an assured income like a salaried person.

Price of farm land per acre is what has gone up over the years, but that is because some folks thought it's best to invest their surplus in farm lands rather than the villas. But that is not a cause for a farmer to go 'splurge' and 'treat' himself with an automotive purchase.

My point being, it's not rural distress. It's just that we have become irrelevant.
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Old 7th August 2019, 09:33   #24
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Default Re: The great Indian automobile industry slowdown of 2018-19

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Originally Posted by NiInJa View Post
There is one trend that we are missing here. With Trump administration, automation and better internet access in India, on-site travel of most IT employees - which is a major force for earning quick money - has reduced drastically. I have seen a lot of people (myself included) making quick bucks this way. Now, these opportunities are used to clear home loans or making investments. Still, I would say IT industry is not exactly hitting a wall anytime soon as there are quite a few cars like the Venue and Hector getting sold. What is more interesting is the way India's own market is behaving.
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Sorry to say but nothing this sort of is witnessed at dealerships in Bangalore.
I have shared my experience in another thread - cars like Nexon, which has outright availability in ROI is available after a wait of 6-8 weeks in Bangalore.

Ecosport, which is nearing its life cycle was finally picked up amidst casual buy it-leave it (some one else will buy it) attitude from dealer.
At least, till date, everything is selling in Bangalore without a fuss !
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Old 7th August 2019, 09:46   #25
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Default Re: The great Indian automobile industry slowdown of 2018-19

Bangalore case is true. Most people I spoke with received good increments this year. Nexon has a 3 Week waiting when I enquired for my relative, but if colour is not an issue you'll get it in a week. On 5th I counted close to 10 new EcoSports in a day. Was wondering if any 'offer' was on. LOL. Kia showroom was swamped like there was some 'jatra', and the serpentine queues outside MG were unbelievable. Malls are also full. So not feeling any slowdown!
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Sorry to say but nothing this sort of is witnessed at dealerships in Bangalore
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Old 7th August 2019, 15:43   #26
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Default Re: The great Indian automobile industry slowdown of 2018-19

The automobile sector slowdown and job losses are making big headlines.
https://www.ndtv.com/business/tens-o...om=home-livetv
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Old 7th August 2019, 17:24   #27
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The great Indian automobile industry slowdown of 2018-19-12.jpg

Productions cuts across all segments and models. Hardly any exceptions seen.
Source http://www.autopunditz.com/

Last edited by jeganatu : 7th August 2019 at 17:25.
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Old 8th August 2019, 00:46   #28
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Mahindra warns of job losses in auto sector, seeks government help

- M&M's heavy goods segment, which makes trucks and tippers, saw its worst growth in nearly six years.

- M&M said in a statement it was only able to maintain margins due to falling commodity prices and the government must reduce the goods and services tax (GST) rate to spur demand.

Quote:
A lending crisis among the country's shadow banks, which fund nearly 55-60% of commercial vehicles and 30% of passenger cars, has led to automakers, including M&M and its rivals Maruti Suzuki India Ltd and Tata Motors Ltd, to either cut production or temporarily close plants.

A slump in sales is also triggering massive job cuts in the sector that employs 35 million people directly and indirectly. Reuters reported on Tuesday that initial estimates suggest automakers, parts manufacturers and dealers have laid off about 350,000 workers since April.

"Now job losses are happening in four areas OEMs (original equipment makers), suppliers, dealers and unorganised sector," Managing Director Pawan Goenka told reporters in Mumbai in a post-earnings press meet.

M&M's heavy goods segment, which makes trucks and tippers, saw its worst growth in nearly six years, the company added, as it reported a June-quarter consolidated profit that nearly halved from a year ago to 9.14 billion rupees ($129.10 million).

"Given the current challenging global and domestic growth environment, a concerted policy effort will be required to prop sentiment, put a floor under consumption and revive growth," M&M said.
Source
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Old 8th August 2019, 09:06   #29
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EV push slowing down demand for petrol, diesel cars: Auto companies to finance minister

In my personal view push for EVs will not slow down the auto industry to the extend, the one we are witnessing now. Infrastructure and liquidity are the main reasons and obvious reason.

Beyond that,new models are hitting the market at a much higher pace than before and prospective buyers might be holding on, to their purchase decision a bit too long, to see any new models they might like.

Link to the article :
https://timesofindia.indiatimes.com/...w/70580082.cms
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Old 8th August 2019, 09:49   #30
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I had forgotten something when I started to work this morning. So I parked my TUV 300 in front of a neighbor's gate, but on the opposite side of the road. I couldn't park it anymore to the side than I did because some numbskull of a vacant land-owner decided to install stone pillars protruding outside his plot. I couldn't park it anywhere else because of some Ola cabs which were parked all along the street.

When I came back out in a hurry, having taken my forgotten item from home, I spotted my agitated neighbor waiting for me. He was in his old Alto. He couldn't back out his XUV 500 because I'd parked it where I had; we spoke about the situation and he quickly realized that there was no point in blaming me in particular.

Do you think I will go on to purchase a Hexa down the line, or if he will upgrade from his XUV 500? If you come to think about it, bigger cars are where the money really is for manufacturers. Price elasticity is not a thing for people with heavier wallets, so bigger cars can be priced out of the park without hampering sales figures.

But what I'm alluding to is space rigidity in our cities. My neighbor certainly found his Alto capable of manoeuvering in the tight space that was available to him and I noted in the back of my mind that my A Star would be much more practical in the city...

And I'm not done yet! I've lived in parts of the city where even my A Star would be the equivalent of a lorry, because of the narrow streets there.

This is the state of the urban Indian automobile market. Go figure.
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