[OffRoadFun]

Originally Posted by sunilch

No that is not the case. Most manufactures have near fixed margins and those are higher than what you have quoted.

Mainstream makers may have lower margins than luxury ones though. Luxury car makers (BMW, Audi, Merc) have margins in the range of 20-30%.

It is dealer margins that are low in India and could be the same at other places too across the globe. What you are referring to is the dealer margins.

I am not sure what your source for those margins is, but 20-30% is very high. Here is a snapshot of 5 year average net profits of major automakers in the world. Not one has even more than 10%. GM is 4.66% and Ford is ~3%.

Autos is a mature industry with tight margins.

Here is the link for full data:

[sunilch]

I am not able to find the links to the articles that had the details but here is the difference: You are referring to net profit at company level which is bound to be lower. What I am referring to is sales margin on their inventory/cars. They operate at high levels. Standard car makers operate in the 10% range and luxury ones operate in 20%+. Higher you go, higher is the sales margin w.r.t their production costs.

Of course, in last 1 year or so, chip shortage and higher commodity costs have reduced those margins but that is only applicable for a short period of time.

Originally Posted by OffRoadFun

I am not sure what your source for those margins is, but 20-30% is very high. Here is a snapshot of 5 year average net profits of major automakers in the world. Not even one has more than 10%. GM is 4.66% and Ford is ~3%.

Auto manufacturing is a mature industry with tight margins.

Here is the link for full data:

[Livnletcarsliv]

Toyota's loss in India, I consider it as an intermittent one.
And one of the main reasons for this loss is the partnership with MSIL which negatively impacted the brand image of Toyota. The other mounting factors to this intermittent loss are this pandemic (eventually leading to chip shortage and other production issues), etc.

And with the recent blockbuster hit of LC300 and the launch of Lexus LX600, Toyota is still one of the most wanted brands in anyone's garage across the globe.

With respect to the margins, the percentage varies with brands and also varies between the models of the same brand.

1. Ferrari has more than 100% margin.
2. Innova and LC300 will not have the same margin.
3. Product margins are a gamble, especially in a country like India. Like "Buy 2 shirts and get 2 free" (or) "Buy 2 sarees and get 3 sarees free". We all know how it works.
4. Ford was never profitable in India in the 25 years of its presence (according to sources working in Ford). But still, it kept its shop open until recently.

Nevertheless, the T brand in India definitely comes at an unreasonable premium. Taking this so-called loss, I hope that Toyota fixes this pricing factor so that its vehicles can make it to more garages.

[Durango Dude]

Basically, Toyota is a one product company: Innova Crysta! Fortuner is getting very pricey for what it offers!! No small car, no sedan: depends on Maruti for both. To be expected a swift death like a Dino hit by an asteroid! Just imagine if the company is in doldrums what of the dealers who have invested crores of rupees?! Aggression of the Korean twins is in stark contrast to the Parkinsonian stupor of both the Japanese companies: Toyota and Honda: they are absolutely clueless and dragging their feet for many years resting on past laurels. Market leader Maruti also has a rather staid portfolio lineup needing a big fillip to revive consumer interest.

[careind]

I think this thread is about the company strategy rather than the products. Innova is a better product than Seltos, Fortuner could be a better product than Carnival. RAV4 could be a better product than All the korean products.
But having a strategy of have just 2 cars and that too , not commonly affordable ones, really shrinks the pie a lot. After that, it doesnt matter much whether you are present or exit the market.
At least if Honda exists many would feel the pinch in the absence of the city as an otion. I wonder who would feel the pinch if Toyota exists . Only a small percent of the population which could afford those 2 cars to begin with. And now with the exorbitant pricing of the latest Fortuner, I think the pie might have shrunk even further.
So it is the company strategy that is being discussed here, and not the product or their global ratings/sales figures.

[achyutaghosh]

Originally Posted by careind

And now with the exorbitant pricing of the latest Fortuner, I think the pie might have shrunk even further.

...and yet Fortuner sales are going through the roof. Despite price hikes, no discounting and suppy challenges. Ford's exit definitely helping.

[PrideRed]

Originally Posted by Durango Dude

Basically, Toyota is a one product company: Innova Crysta! Fortuner is getting very pricey for what it offers!! No small car, no sedan: depends on Maruti for both. To be expected a swift death like a Dino hit by an asteroid! Just imagine if the company is in doldrums what of the dealers who have invested crores of rupees?! Aggression of the Korean twins is in stark contrast to the Parkinsonian stupor of both the Japanese companies: Toyota and Honda: they are absolutely clueless and dragging their feet for many years resting on past laurels. Market leader Maruti also has a rather staid portfolio lineup needing a big fillip to revive consumer interest.

Barring Maruti, Tata and Hyundai almost all other manufacturers in India are one or two product company. Honda-City/Amaze, KIA-Seltos/Sonet, Renault- Kiger/Triber/Kwid(last one is losing steam), Nissan-Magnite, MG-Hector, Mahindra- Thar/XUV etc.
Agree the Japanese are not as aggressive as the Koreans but If I compare against Europeans, the Japs are not in bad position.

[Livnletcarsliv]

Originally Posted by PrideRed

Barring Maruti, Tata and Hyundai almost all other manufacturers in India are one or two product company. Honda-City/Amaze, KIA-Seltos/Sonet, Renault- Kiger/Triber/Kwid(last one is losing steam), Nissan-Magnite, MG-Hector, Mahindra- Thar/XUV etc.
Agree the Japanese are not as aggressive as the Koreans but If I compare against Europeans, the Japs are not in bad position.

I disagree.
1. KIA - Even though KIA's primary sales numbers are from Seltos & Sonet, at an average of 400 units/month and being a CKD, carnival sales numbers are pretty good.
2. MG - In case of MG - even though Hector is the sales champion of MG, Gloster sells in good numbers also. And the recently launched Astor is a well-received product where it is sold out for 2021.
3. M&M - Bolero is still the sales champion for M&M. The Neo Bolero is still a well-received car. Thar on the other hand has a waiting period of up to 9-12 months in some cases. XUV700 with its 50K bookings (remember, it's just bookings) is still a great number even before the first car is delivered.
4. Renault/Nissan - They are not different companies altogether. It's called Renault Nissan India Pvt Ltd.

Finally, which European brand are you comparing to? If it's the VAG cousins - then their combined model lineup is even more than Tata's/Hyundai's.
The only exception here is Honda - which still is surviving with just 2-3 refreshed models.

So, it's not justified why Innova/Fortuner should be sold at a significant premium over the others.
And this recent news adds to the conundrum - https://www.overdrive.in/news-cars-a...tic-wholesale/

[PrideRed]

Originally Posted by Livnletcarsliv

I disagree.
1. KIA - Even though KIA's primary sales numbers are from Seltos & Sonet, at an average of 400 units/month and being a CKD, carnival sales numbers are pretty good.
2. MG - In case of MG - even though Hector is the sales champion of MG, Gloster sells in good numbers also. And the recently launched Astor is a well-received product where it is sold out for 2021.
3. M&M - Bolero is still the sales champion for M&M. The Neo Bolero is still a well-received car. Thar on the other hand has a waiting period of up to 9-12 months in some cases. XUV700 with its 50K bookings (remember, it's just bookings) is still a great number even before the first car is delivered.
4. Renault/Nissan - They are not different companies altogether. It's called Renault Nissan India Pvt Ltd.

Finally, which European brand are you comparing to? If it's the VAG cousins - then their combined model lineup is even more than Tata's/Hyundai's.
The only exception here is Honda - which still is surviving with just 2-3 refreshed models.

So, it's not justified why Innova/Fortuner should be sold at a significant premium over the others.
And this recent news adds to the conundrum - https://www.overdrive.in/news-cars-a...tic-wholesale/

Well if I am to look at similar lines, Camry sells 50-100 units every month despite costing quite more than Superb. Toyota sells about 50-75 copies of Vellfire which costs nearly 4 times that of Carnival. And not to forget Vellfire being CBU has waiting period. Though rebadged, Toyota sell 2500 copies each of Glanza and Urban cruiser which is quite decent numbers. Revenue generated by Innova and Fortuner is much more than some of the manufacturer s out there. So if you look at Toyota's lineup there is no sales dud. I am no expert nor do I have insights as to what led to loss, Fortuner and Innova may bring in majority revenue but don't see Toyota as 1 trick pony.

[Livnletcarsliv]

Originally Posted by PrideRed

So if you look at Toyota's lineup there is no sales dud. I am no expert nor do I have insights as to what led to loss, Fortuner and Innova may bring in majority revenue but don't see Toyota as 1 trick pony.

Exactly bro, this is just hype from the media. There is nothing I see, that justifies this so-called loss. Probably this loss can be theoretical and virtual opportunity loss due to the limited production and supply on the account of pandemic.