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Old 19th September 2020, 08:34   #196
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

Agree to your points except one; Compact SUVs and SUVs are the flavour of the season and cost north of Rs 10 Lakhs. Data suggests that these are the hot-sellers, and market share is on the dominant side. Could be the opposite. In fact, hatch and sedan versions which cost under a million Rupees are struggling
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Even then, the sales of sub 4M cars dominate and the leading car manufacturer of the country dominate that segment; this implies that sales of medium sized cars or cars costing more than 10 lakhs are shrinking.
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Old 19th September 2020, 19:35   #197
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

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But my real question is, should Toyota be disappointed with India or should India be disappointed with Toyota?
As a patron and admirer of Toyota Cars, feel let down by the statement. In plain language its like the old proverb, a poor carpenter blames....

The statement seems to be coming out to cover the failure of hybrid car strategy taken by Toyota. With GoI promoting electric vehicles with incentives, the hybrid strategy has failed drastically as a tool to gain market share. Also it remains a fact that Toyota has been lackadaisical in bringing models and platforms to garner market share and with smart movers like Kia taking the cake, the Indian management would have been forced to come out with an explanation.

Rebadged cars are a temporary solution and not a long term strategy for a brand. Hope the company corrects itself and dont take Indian market for granted for long.
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Old 20th September 2020, 12:38   #198
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

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Agree to your points except one; Compact SUVs and SUVs are the flavour of the season and cost north of Rs 10 Lakhs. Data suggests that these are the hot-sellers, and market share is on the dominant side. Could be the opposite. In fact, hatch and sedan versions which cost under a million Rupees are struggling
The reference to cars costing more than 10 lakhs was made in the context of safe and comfortable cars.

I Agree with you - even the sub 4M SUVs today cost more than 10 lakhs - almost all of them. These cars are presumably safer and comfortable than the ones specifically designed to take advantage of sub 4M benefits. However, pls note that the under 10 lakhs cars still more than 50% of the total sales.

The larger context of my argument were a.) expensive due to indiscriminate taxes and .b) need to see more safer cars on road, which at present costs upward 10 lakhs creating affordability issue.
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Old 21st September 2020, 08:39   #199
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

Washington post & Bloomberg covers the above matter in their article ,
" Toyota or pakora - India must decide"

Looks like Toyota just touched the livewire & This issue can turn to be a major debate among the existing & future investor circles .

https://www.washingtonpost.com/busin...8cd_story.html
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Old 21st September 2020, 08:50   #200
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

So, Cat is out of the bag and what started with Toyota, has now reached the doorsteps of Maruti Suzuki. Now, it gets interesting and I will be looking forward to hear about this development.

Kenichi Ayukawa, MD Maruti Suzuki India and President-SIAM, argues for government help in lowering taxes and sales incentives for auto companies.

https://m.economictimes.com/industry...w/78225954.cms

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Old 21st September 2020, 11:10   #201
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

I have been seeing Toyota bashing everywhere. Whatever Toyota’s failings/shortcomings might be, they are not wrong that the Indian automobile sector is unfairly taxed. And guess what? We, the Indian consumers, are getting shafted. Toyota is not paying those taxes, we are.

One way of looking at it is a simple mathematical equation. Higher taxes= higher cost.

Another way of looking at it, and this is probably a truer and less direct deduction, to keep costs reasonable (within buyers reach) the automobile industry adjusts for high taxes and cuts corners on research and materials thereby compromising safety and economy.

So, not only do we pay more because of high taxes, we get far less than anyone anywhere in the world. Despite having the cheapest labour in the world we have the most expensive products.

It’s likely that the entire automobile industry is backing this position. Toyota might have decided to speak up first, this might be part of strategy, or might have drawn the short stalk at the meeting of the association. It is unlike a big business to speak out of turn. Especially in a country where the people in power are prickly and vindictive. We might be witnessing the last straw that broke the camels back moment in history here.
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Old 21st September 2020, 11:46   #202
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When we do a simple Math of the ratio of Ex-Showroom Price to the Final Onroad price, it will trivially be visible that there is a huge amount of money that goes towards Taxes and other charges. It indeed is fair to say that the taxes on automobiles is perhaps very high in our country.
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Old 21st September 2020, 12:35   #203
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

As much as I hate to repeat what has already been said but here are main issues:

Mistakes made by Toyota:

1) They just did not take the Indian market seriously enough. The Etios was doing quite well and had they replaced it with a new gen after 5-6 years like Maruti does with the Swift or Hyundai does with the i10, they'd have seen more success. The same argument goes for VW (Decade old Polo and Vento), Ford (Old EcoSport), GM (Old beat and cruze - both bestsellers) and even Fiat. So, while the Indian market grew, both the market size and the actual sales numbers of these brands dropped while Maruti and Hyundai took over their market share they left behind. Look at the sales numbers for 2011, Maruti wasn't as dominating back then and other makers were doing rather well.

2) Stupid decisions like 1.4 diesel in a Corolla with no infotainment, overpricing the Crysta which resulted in sales shifting to the much superior Kia Carnival.

3) Plans like selling a Rav4 for 60 Lakhs makes me question what exactly are they smoking in the morning!

However, all is not lost. They have competent products like the Corolla Cross crossover which will work for India. Toyota still has the brand image in India, only if their products were as good as Kia/Hyundai or even Tata/Mahindra.

Mistakes made by the GOI:

1) They need to stop bickering with the taxes. The luxury tax on cars is a disaster, I'd say keep the GST at 28% and remove any cess. Given the relatively miniscule sales of >20 lakh cars, there isn't much additional revenue to speak of anyway. Remove silly rules about ground-clearance, engine-size and car length.

2) Provide a long-term roadmap till 2030 with all the changes listed with the dates for these changes. No knee-jerk regulations or bans with 4 hours notice that GOI has become so addicted to now.

3) To be a upper middle-income country, we've to think like one. The policies which we thought we had long forgotten since the pre-liberalization era are coming back and instead of having a more equal middle-class population, we will end up with a equally poor population who obviously can't afford to consume anything. No wonder that the number of people in the consumption class in India is similar to Singapore which is a city-state!

4) They need to focus and let the market function without over-regulation. Over-regulations kills innovation and encourages monopolies (Jio, Maruti etc)
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Old 14th October 2020, 23:48   #204
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

I started wondering last night about Multinationals and their stepmotherly treatment of India.

Apple launched their flagships last night and created a right hoopla about the never before pricing for India. And what do we get? An iPhone 12 mini priced the same as a Pro is priced in the US. We pay more for accessories too. Is anyone surprised that Apple hovers around a 3% share in the largest smartphone market in the world?

Then there is VW. VW Taos was announced as the rival for Seltos in the US market. From reports it looks like a competent, well built and well kitted vehicle. And what do we get? The Taigun? 10-yr old (unreliable) Ventos and Polos? Or their new cheaper platform?

And here is Toyota too. Now launching rebadged Marutis. The house of Etios, that tin-can masquerading as a car. And class leading engines such as the 87bhp monster that they were peddling for near 20L.

Contrast this with Kia. They developed the Seltos for India. And then lo and behold the car becomes a colossal success in the US and several other markets. VW itself took the Vento idea and raked it in in Russia and the Americas. And OnePlus that is handsomely leading the Indian market, by adopting an India first strategy.

The reason I thought I'll put it together is I'm becoming a little tired of this. And frankly a little sickly. This is becoming a bit of a pattern. It's got little to do with India's business climate too. Given that we are amongst the cheapest markets for production, add the latest SOPs and corporate taxes, combine the several state-governments bending over backwards to get companies to invest, I frankly find it incredible. Because it can be done, can't it. Hyundai has made India its second home. Kia has invested, gained. VW exports a fair plentiful. So why?

Last edited by Annibaddh : 14th October 2020 at 23:53.
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Old 15th October 2020, 00:41   #205
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

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Originally Posted by Annibaddh View Post
I started wondering last night about Multinationals and their stepmotherly treatment of India.

Apple launched their flagships

And here is Toyota too. Now launching rebadged Marutis. The house of Etios, that tin-can masquerading as a car. And class leading engines such as the 87bhp monster that they were peddling for near 20L.

Contrast this with Kia. They developed the Seltos for India. And then lo and behold the car becomes a colossal success in the US and several other markets.

This is becoming a bit of a pattern. It's got little to do with India's business climate too. Given that we are amongst the cheapest markets for production,

Ys, some MNCs do treat us in an unfair manner, giving us inferior products as compared to what they offer overseas. VW, as you rightly mentioned is an amazing example.

Lets keep apple out of this, Apple only makes products targeting to a very specific segment, and 95% of this country neither has, nor ever will spend more than 15K on a phone.

Now as for the Seltos, let me tell you that the Seltos in India and the USA has nothing in common, except for the name and the looks. N-O-T-H-I-N-G.
The Seltos story can be equated with the Duster saga, in which we just get a car that looks like the international duster. Seriously, different engine, different Chasis, different mechanicals, different gearbox. And no AWD.

Quote:
The Kia Seltos is available in three different body styles globally, namely SP (sold in developed markets; SP2c (sold in China), and; SP2i (available in the Indian market)
Note C and I for China and India, respectively.

The engines that they put in the car in the USA wont fit in our Seltos. Which means they're using a different platform. (most likely Tucson platform)

Your beloved Kia, and I say it so because you seem to have praised them a lot is no less guilty of discrimination. Seltos in USA gets a standard AWD system, and we dont even get it offered as an option.




Toyota halts India expansion, blames ‘We Don’t Want You’ taxes-kiaseltosinvoice.jpg

Now as for your final paragraph, here, this is why Kia does what it does.
See, how what is a 10 lakh rupee car by Kia becomes a 13 lakh rupee car to the showroom? And a 16 and a half lakh rupee car to you.
The government lands a cool 7 lakh rupees on one car sold. S-E-V-E-N.

Now to further your Kia seltos example, the seltos starts at $25,000 in the USA. Lets say it costs them $23,000, with a grand margin for both the manufacturer and the dealer.

$23,000 is 16.86 lakhs. Lets just round it off to 17. So a base level Seltos, as is sold in USA, billed to the dealer at 17 lakhs, would, 22.95 Lakhs ex-showroom. And add to that 14% road tax, it comes to 26 lakhs 16 thousand.

Would you pay 26 lakhs for a Seltos that is USA spec? No. Because we Indians like our seltos at 9.99 ex-showroom, so that we can have a HTE at 12.5 on-road, and add cheap hypersonic android head-units which are made in china, and forward boycott chinese goods messages on them.

We're a price sensitive market. Just accept what we have, and just make peace with it.




I'm not a massive fan to Toyota either, but all I got to say is that the product that they sell in Australia is what they sell in India (Fortuner). We might pay more, but atleast we aren't being fooled. I've personally made peace with the fact that products like VW Polo, that we get right now are clearly a generation behind, but atleast are global products.
And there is one thing this nation needs to make peace with. Global products dont come cheap.

I'll be okay with paying 12 lakhs on road for a next-gen polo with EA211, provided its EU spec, but how many will there be like me?

People in this country want an i20 at 6 lakhs ex-showroom, and for that corners have to be cut.
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Old 15th October 2020, 03:56   #206
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

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Originally Posted by Annibaddh View Post
I started wondering last night about Multinationals and their stepmotherly treatment of India.


Then there is VW. VW Taos was announced as the rival for Seltos in the US market. From reports it looks like a competent, well built and well kitted vehicle. And what do we get? The Taigun? 10-yr old (unreliable) Ventos and Polos? Or their new cheaper platform?

And here is Toyota too. Now launching rebadged Marutis. The house of Etios, that tin-can masquerading as a car. And class leading engines such as the 87bhp monster that they were peddling for near 20L.

Contrast this with Kia. They developed the Seltos for India. And then lo and behold the car becomes a colossal success in the US and several other markets. VW itself took the Vento idea and raked it in in Russia and the Americas. And OnePlus that is handsomely leading the Indian market, by adopting an India first strategy.

The reason I thought I'll put it together is I'm becoming a little tired of this. And frankly a little sickly. This is becoming a bit of a pattern. It's got little to do with India's business climate too. Given that we are amongst the cheapest markets for production, add the latest SOPs and corporate taxes, combine the several state-governments bending over backwards to get companies to invest, I frankly find it incredible. Because it can be done, can't it. Hyundai has made India its second home. Kia has invested, gained. VW exports a fair plentiful. So why?
We need to understand that car companies or for matter of fact any company (Indian or MNC) is not in business of being our (proverbial) mother or stepmother. They do exist in this world for the sole purpose of making money and they (are supposed to) do every action to give maximum return to their shareholders. If they believe (rightly or wrongly) that x product would sell in India and they can sell it at a profitable price (remember product cost is not the sole deciding factor for deciding a price) there are other fixed cost associated with every company/ product in addition of taxes which they need to recover. So all of it comes to pure numbers.

And about Etios remember that it was made for India car which got 4 star in crash test and was said to be reliable but was a pure failure in our market for various reasons (I believe including for ugly front).

So if your market can create profit for companies (either by volume or higher price point) they would come and lick your feet, otherwise, they won't even let you see their wares let alone sell to you.

Remember Indian's favourite company is so hesitant to bring it's Jimny to India because there are not enough numbers, but it's willing to convert the same product as just a commercial loading vehicle for European market (when EU didn't allow it to sell as car due to pollution norms). Tata ji, the proud Indian is willing to be a junior partner of Chinese company to sell JLR products in China but it's hesitant to invest in India.

As I said it's just a number game.

All said, I'm not saying they don't make mistakes in numbers but still it remains about numbers (you might question, they are correct or not) but never about sentiments.

Quote:
Originally Posted by turbo View Post
Ys, some MNCs do treat us in an unfair manner, giving us inferior products as compared to what they offer overseas.

We're a price sensitive market. Just accept what we have, and just make peace with it.

And there is one thing this nation needs to make peace with. Global products dont come cheap.

I'll be okay with paying 12 lakhs on road for a next-gen polo with EA211, provided its EU spec, but how many will there be like me?

People in this country want an i20 at 6 lakhs ex-showroom, and for that corners have to be cut.
Very rightly put.

Last edited by vb-san : 15th October 2020 at 12:52. Reason: Typo
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Old 15th October 2020, 05:09   #207
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Lets keep apple out of this, Apple only makes products targeting to a very specific segment, and 95% of this country neither has, nor ever will spend more than 15K on a phone.
That remaining 5% accounts to 5 Mn smartphones sold in India. Annually. It's significantly larger than many other markets where Apple products are priced competitively. So no I'd not keep it out of this.

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Note C and I for China and India, respectively.

The engines that they put in the car in the USA wont fit in our Seltos. Which means they're using a different platform. (most likely Tucson platform)
I'm quite aware of the differences between the platforms. The US version uses the older B-SUV platform shared with the Kona. The platform allows for both larger engines, electrification and AWD.

The India and China (and most of Asia) versions are based on the newer HK K2, derivatives of which do duty on everything from the Verna to XCeed. The platform itself does not allow AWD. However the Kia product remains the same /comparable across all major markets in Asia. VWs does not. Neither do Toyotas (having driven an earlier generation Vios in KL for a while).

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Now to further your Kia seltos example, the seltos starts at $25,000 in the USA. Lets say it costs them $23,000, with a grand margin for both the manufacturer and the dealer.

$23,000 is 16.86 lakhs. Lets just round it off to 17. So a base level Seltos, as is sold in USA, billed to the dealer at 17 lakhs, would, 22.95 Lakhs ex-showroom. And add to that 14% road tax, it comes to 26 lakhs 16 thousand.

Would you pay 26 lakhs for a Seltos that is USA spec?
This does not take into account multiple cost elements unrelated to product which would drive the cost for the US product much higher. Higher cost of manufacturing / logistics / manpower and so on. So disagree with your hypothetical. But what is clearly an indication is that the imported Kona costs 25L off the shelf in India with all the massive duties and cost of batteries. Cost of the US Seltos can't be that far off the India spec Seltos, if Hyundai can price the Kona at 25 with all its baggage.

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Originally Posted by turbo View Post
I'm not a massive fan to Toyota either, but all I got to say is that the product that they sell in Australia is what they sell in India (Fortuner).

And there is one thing this nation needs to make peace with. Global products dont come cheap.

I'll be okay with paying 12 lakhs on road for a next-gen polo with EA211, provided its EU spec, but how many will there be like me?

People in this country want an i20 at 6 lakhs ex-showroom, and for that corners have to be cut.
There's a market for competent products, even at a premium. The market has demonstrated this multiple times. Octavias, your own example of Fortuners, Polo GTs. Heck even early Ventos and Rapids flew off the shelf (momentarily pushing the mighty city to #2). Compass did particularly well. Are there idiosyncrasies in the market? Of course. What market does not?

The answer lies in commitment to the market. Players who have: OnePlus, Kia, Hyundai...have succeeded. Brands which haven't? Not so much.
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Old 15th October 2020, 08:27   #208
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

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That remaining 5% accounts to 5 Mn smartphones sold in India. Annually. It's significantly larger than many other markets where Apple products are priced competitively. So no I'd not keep it out of this.
It's not so simple, we have 20% custom duty on such phones and 18% GST. Also factor the exchange rate hedge that Apple applies everywhere. Even in Canada, you will find prices higher than USA. You can also compare Iphone prices in UK / Australia vs USA and these will be higher everywhere.

Quote:
The answer lies in commitment to the market. Players who have: OnePlus, Kia, Hyundai...have succeeded. Brands which haven't?
Probably the word should be localisation. Most companies you have mentioned and our own Maruti have launched models with features (or missing) & specifications (or compromises) for India specific markets.

Many others cannot and will not. Some companies firmly believe in having similar quality and specs everywhere. Ok, there might be a missing feature here or there but I doubt, Toyota will have a thinner or different body panel for Indian market over Australian.

There are customers for every brand, some will find a value in 30 Lac MG over 35 Lac Fortuner whereas others will be happy to spend 1,5 Cr on a Land Cruiser over anything else.

But, the fact remains, until the taxes are reduced, we will continue to get either compromised spec stuff or pay high for something which meets global standards. Again, this is my own views and you can have yours but asking Toyota to do what Kia or Hyundai is doing is not fair.
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Old 15th October 2020, 09:01   #209
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Default Re: Toyota halts India expansion, blames ‘We Don’t Want You’ taxes

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I'm not a massive fan to Toyota either, but all I got to say is that the product that they sell in Australia is what they sell in India (Fortuner). We might pay more, but atleast we aren't being fooled.
Sorry to disappoint you or maybe the homework ain't done right.
I do own a fortuner, so unbiased feedback.
Toyota also does this. In the fortuner, we do not get lockers which is one of the most critical 4wd hardware.
I am sure you would find some differences between any of the toyota models between 2 country versions.
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