Team-BHP - Two-wheeler dealers overcharging road tax?

I am in the market for a gearless scooter and have visited Honda, TVS and Suzuki dealers in Coimbatore. All of them invariably charge a Lifetime Road Tax (LTRT) of 8% on Ex-Showroom + some random amount. Is this the norm across the spectrum? Here is the break down of OTR prices for Jupiter Std. and Access 125 obtained from two dealers in Coimbatore, Tamilnadu.

TVS Jupiter Std. from Sri Sakthi Saradha Enterprises LLP, Trichy Road.

Ex. Showroom - 53,714
Extended Warranty - 359
Mandatory Fittings - 935
LTRT - 4,773 (Actual at 8% is 4,273)
Misc. Expenses ( RTO+Handling) - 2,000 (Actual registration fee is 60/-)
Insurance - 1,912
Additional Fittings - 2,118
_________
OTR Price 65,514
_________
************************************************** ***
Suzuki Access 125 (Drum) from Sujatha Automobiles Pvt. Ltd., Trichy Road

Ex. Showroom - 57,136
Extended Warranty - 675
Fittings - 4,426
LTRT - 5,221 (Actual at 8% is 4,571)
Misc. Expenses ( RTO+Handling) - 2,429 (Actual registration fee is 60/-)
Insurance - 1,791
Helmet - 1,250
_________
OTR Price 72,928
_________

I asked the Sales Exec. at Sakthi Saradha TVS to confirm the LTRT rate and he said it was 8%. I asked him to calculate 8% of ex-showroom and it came to 4,273. He immediately said that LTRT was 8% + 500. On being asked to explain the addl. 500 rupees charge for LTRT all he could do was mumble something about increase in road tax and insurance charges. When asked why they were adding insurance costs to LTRT he had no answer. As for RTO and Handling charges all of them claim that they have to bribe RTO for registration. While that may be true, rupees 2000 plus for registration is unreasonable.

I called TVS customer service and asked them why their dealer was charging these unexplained fees, the customer service rep. said that TVS can only discuss ex-showroom price and all other charges have to be discussed with the dealership. After repeated questioning, he finally gave me their territory manager's number (9443758292) and told me to talk to him for further clarification.

I don't have the price breakdown from Honda but it was also similar numbers. On average the dealerships add about 2500 rupees in hidden charges. What are other folks' experience in Tamilnadu?

Thank you admins for approving this thread.

Update: I called the TVS territory manager at the given number and talked to him. He called the dealer and I got a call back from the dealer. They claim that this is the standard rates charged by all dealers and is approved by TVS :Shockked:. He suggested that I contact TVS and ask them to send a directive to the dealers not to charge the handling fees. Out of the addl. 500 charged by them on LTRT they claim that 250 is a road safety tax which I verified on the TN RTO website to be true. Still no explanation for the other 250.

I tweeted this to both TVS and Suzuki India. Also called Suzuki customer service toll free number. Waiting for their responses.

I would be surprised if you can get a resolution from these two wheeler dealers. The whole two wheeler mass market is like a vegetable market. You go, pay, stand in line to get your vehicle and bring it home.

In comparison, I notice that these days most of the car dealers will not charge 'Indidental' or 'Handling' fees which they used to charge earlier. Unless customers start complaining about such things in huge numbers, they will never feel the heat and make changes. In your case, your efforts will mostly give fruit, but that will be limited to your sale. The guy next to you buying the same vehicle will not even know about this and he will still pay extra.

On a positive note, when I went to enquire about the Ninja in a Kawasaki showroom, the pricelist had a 1% TCS field for all the bikes, but as per the rules the Ninja and the Z250 were to be excluded. As soon as I was handed over the price list, the SA did tell me that the TCS calculation was an error and I need not pay the same. Immediately I could appreciate his honesty and transparency and I did not have to probe the calculation and get the truth out forcibly.

The comparison here is simple - The Kawasaki dealership might sell on an average one bike per day. Hence, every customer would be important. But these mass market dealers sell at least 20-30 vehicles per day on a conservative estimate. If one customer walks away seeing such discrepancy, they are not bothered at all. Even if they are charging an excess of 250 per vehicle, considering their numbers, it will lead to a significant profit, at least to cover up the costs of the agent who will get the vehicles registered.

Lately I heard that in Bangalore the registration process is automated and does not require going to the RTO like earlier. If this is the case, then you should get a receipt for all the charges paid. If there is any part of the total amount which is not backed up by a receipt, then do question the same and ask for a refund if any excess amount is paid.

A similar scam used to happen once upon a time when I brought my dio in 2013 - Accessories were regarded as mandatory. This was a pack of around 4-5k rupees which customers were forced to buy. When I went to purchase, this was included in the on-road price of the vehicle. As though they were providing everything from the factory. I gave the salesman the most surprised and confused expression and asked him what the accessories part was about. He then told me that they will put so and so parts onto my Dio. I laughed at him and told me to give me the vehicle as it came from the factory, but with a side stand and rear foot step which again was not provided from factory and revise the calculation as it is. He had to agree and could not convince me with some theory. Now when we got another Dio for my brother a few weeks back, this drama did not happen and the sales guy asked if we needed any accessory.

Quote:

Originally Posted by audioholic (Post 4237451)

In your case, your efforts will mostly give fruit, but that will be limited to your sale. The guy next to you buying the same vehicle will not even know about this and he will still pay extra.

I'm hoping that whether I'm successful or not, my efforts will create awareness at least among my friends and family and encourage them to question all the charges.

I will also be talking about this matter with my Rotarian friends and file an RTI with their help to the TN RTO asking what the actual bribe for registering a new vehicle is. Yes, that will be trolling but I plan to pose that question among the many I have regarding this issue lol:

Quote:

Originally Posted by green_ninja (Post 4237556)

Kudos on your effort!

I faced a similar issue when I bought my Activa 125. Checked with Honda dealers and they couldn't justify the 2-3k above calculated OTR.

Abandoned the decision to purchase through Honda dealers and approached a multi-brand dealer through a common friend and he readily agreed to do it for Ex-Showroom + Road Tax + Registration Charges + my choice of Insurance + 500Rs (for RTO bribe I presume). Ended up saving me about 1500 Rs.

And the best thing is I picked up the vehicle with him from the exact Honda dealer stock yard I was dealing with earlier.

About four months back, when I bought my Electra, I just paid the ex showroom price+ road tax + registration charges , the last two amounts with RTO receipts. I denied other offerings (crash guard, teflon coating package, RSA etc). Took insurance also my own. Saved more than ₹5000, which wouldn't be the case with regular customers.

My cousin is a wholesale distributor of two- wheeler accessories and I got the crash guard from him for free. According to him, delaers are charging almost double for the accessories, after obtaining these accessories from him. Considering the profit for my cousin, I wonder how much these accessories cost actually.

Why two wheelers ?

When I purchased my car and took quote, even all four wheeler showrooms had similar quote. At-least 4-6k extra over actual registration/tax related charges.

There is one more malpractice they do to avoid legal issues. That is with the money receipt. Both two or four wheeler deals alike.

Dealers issue money receipt on total money. The break down doesn't include anything apart from ex-showroom/tax(car sales)/insurance and then things go vague. Miscellaneous / handling / this that comes into effect.

At the time of my purchase, when I argued on this extra money on actual RTO expense. Every dealer told me that "this is how it is done" with confidence. They were happy to sell me without registration and allow me to registration my self.

Only work around I found was to calculate the extra that I was being charged then made sure to bargain hard to obtain benefit worth that same figure. At-least as close as it was possible.

But few days down the line I found, in anyway I had to send/take my car to RTO office. Once for verification and second time for number plate fittings. I wondered, only thing left was to stand in queue and file the paper for registration for this self registration process.

Quote:

Originally Posted by Sheel (Post 4237608)

Ex-showroom is inclusive of VAT/GST. You need to subtract that amount and then calculate the taxes.

Yes. You're right. I just checked the RCs of my Innova and Alto. Innova they charged me what is on the RTO receipt but Alto they charged me 10% of Ex-showroom but paid about 2000 less as noted from RC. I did not catch it at the time.

Quote:

Originally Posted by knightrider_7 (Post 4237761)

I can do that also but I would still need to buy mirrors and side step from the dealer to get the vehicle registered.

Quote:

Originally Posted by NaXal (Post 4237788)

True. Please see my response to Sheel. If nothing works out I will just pay the Rs. 40 for temp regn. and get the vehicle registered myself. I will still save about Rs. 2000.

Quote:

Originally Posted by mithun (Post 4237911)

@green_ninja:

1. Have you checked bikewale.com for the breakup of the onroad price? Its coming near to ₹ 60,988 and if I remove the fittings(from your price) its coming to 62,461

2. For the Access, why they are charging Rs. 4,426 for Fittings?

Yes. I checked bikewale and they calculate roadtax as 8% on Ex-showroom. It comes to Rs. 4,274, the same as me. Their insurance is on the higher side at Rs. 3,291. But their OTR is Ex-Showroom+LTRT+Ins. They don't add all the other charges that dealers add.

I have no idea why they charge so much for the Access fittings. Maybe it's the Suzuki "gold" standard.

Quote:

Originally Posted by GTO (Post 4237821)

A related thread from the car section - link.

Thanks. I'll keep that thread in mind if I end up filing an RTI.

Quote:

Originally Posted by green_ninja (Post 4238037)

I can do that also but I would still need to buy mirrors and side step from the dealer to get the vehicle registered.

I forgot to mention that I did the registration myself. Here in Kerala, When you get the vehicle from the dealer you would have already paid the charges for registraion. You don't need to pay anything extra when you go to registration with your vehicle.

You can do the registration yourself if you have all the papers with you. A checklist for the same is provided in Kerala MVD website (under Forms->Vehicle registration link). The same set of documents would be needed in other States also, I believe. There is no need to have all the accessories fitted from the dealer in that case. Just get the vehicle from dealer and then fit all the basic accessories from outside shop before you go to RTO for registration.

The RTO registration charges is usually paid to the RTO asst inspector/ inspector who goes on a round of the automobile showrooms in a town/city/metro with his papers and registers all the vehicles. Each such inspector has a designated route and a select set of dealers that he has to visit regularly. He is paid (bribed ?) the registration charges by dealers who do not have to move the motor vehicles to the local RTO office. I have seen the inspectors using private cars (paid for by the dealers ?) to move around if the official RTO vehicle is not available.

And hence such a fee enters the billing schedule of the dealer. Its good that you have sought clarifications @ green ninja.

In the earlier days, the registration would be for a handful of vehicles that would reach the RTO office from every local showroom for assignment of registration numbers, after payment of the requisite taxes etc. Its not so these days. Each dealer has scores of vehicles to be registered and to be delivered (their schemes to ensure delivery within a few hours and so on) and this has all resulted in such fees propping up for questioning. The vehicles are static in the showroom and get registered after the inspector visits.

Update: I got a couple of calls from the Suzuki stealership and after I explained my position the guy who called me said that all pricing decisions are made by the management. He told me that he was going to consult with the management and get back to me. It's been two days since and no one has called me back.

In the meantime, I was kind of not fully convinced about the comfort levels of a scooter for bad city road. This was going to be a personal/part-time office vehicle for my business. I had been talking to the RE guys before and they weren't padding their bills with sundry charges. I just wasn't too happy plonking down 1.5lacs on a bike. After all this drama, I just said what the hey! and just went ahead and booked a RE 350 ES.

I have talked to a couple of RTI activist friends and I will be proceeding with the RTI request as an academic experiment if nothing else. Please feel free to post any questions that you would like to ask the TN RTO regarding the above issue and I will add it with my request. I will update as soon as I get some response. Thanks!