Hycross selling in black market at a premium: Is Toyota really unaware

One has to pay 3 lakh in cash over and above the official on-road price to the dealer for the sale. This is NOT a premium for forced add-on accessories.

BHPian Axe77 recently shared this with other enthusiasts.

The opening post has brought out a pertinent point and I hope it doesn’t get lost in some of the tangential aspects being discussed. Out of curiosity, I searched for less than one year Hycross. A couple of listings that came up in today’s search are in the screenshot. I had called one of the listings which popped up in my search a couple of days ago.

Here is the sum up of the proposal as the person outlined it:

  • The listing was by a non-dealer intermediary. The actual sale will be by an authorized Toyota dealer.
  • The car is obviously showroom brand new. Not a used car / demo car etc. Genuine new car where you are the first owner like any other new car purchase from the actual authorised dealer.
  • Once you confirm the terms and put in a booking amount, they will reveal the name of the dealer. It was confirmed that it is a Mumbai-based dealer (since my search was Mumbai-centric). I have no doubt one can similarly purchase this in other city-specific dealers as well if one can do so in Mumbai.
  • The car is a stock ZX/ZX(O) without a lot of bundled accessories. The key is that one has to pay 3L in cash over and above the official on-road price to the dealer for the sale (not sure how the dealer and DSA will share this). This is NOT a premium for forced add-on accessories. It is a pure and simple black market premium.

Now, in what world is this correct? This is a plain and simple good old days of unethical top-up amounts.

  • Toyota cannot possibly be unaware of this situation. Why in the world is it turning a blind eye to this?
  • Dealers are generating cash earnings with no tax implications whatsoever. Why should this be tolerated / or allowed?
  • Legitimate customers are being taken for a ride with either non-existent supply issues, or not being allowed to book under the pretext that “bookings for ZX (O) are not open” while the reality is that ZX(O)s are being sold via these black market channels.

This is no longer a supply issue and it’s impossible that Toyota is unaware of this. That means they are a silent facilitator by allowing it to subsist instead of cracking down on dealers.

Dealers will be dealers like many other businesses run in India and I have little to no hope from them on business ethics. But personally, I have zero respect for Toyota India’s attitude on this issue. Are we accepting Toyota has no control over dealers continuing the narrative that customers still can’t officially book a ZX/ZX(O)s at all? This is unacceptable and should warrant an internal crackdown between the brand and dealers.

PS: While I have of course not actively pursued this conversation I seriously doubt this is a scam. It seems like this is a well-oiled DSA / dealership-styled sale.

Here's what BHPian Cavityavenger had to say about the matter:

You're absolutely spot on with your inference of this issue. I'm still waiting on my ZXO delivery in spite of booking it on the first day Nov 26, 2022. I know for a fact that the dealers are charging a minimum of 5L or more premium in the Chandigarh/Punjab region. I have recorded conversations with the dealership folks where they guarantee delivery within a couple of weeks. There are multiple social media ads/OLX and other local 2nd hand dealers involved where they take a cut for these direct sales from the dealer.

I emailed Toyota a year back about the lack of transparency in the process since the dealer kept giving me random estimates for delivery and my number on the waitlist. Instead of pursuing the matter, TKM forwarded my email back to the dealer who again gave me the same BS.

In June 2023 I got a text message with a link to some QRSTRIX website (not sure if this is operated by the dealer or directly from Toyota), which showed my booking number/date and my position on the waitlist. In June 2023 I was on waitlist no. 24 and as of March 2024, my position is 5. So am I to believe that the dealer has sold only 19 ZXO vehicles in 10 months?

I wonder if there is a judicial recourse to this where the court can ask these dealers to produce inventory records of vehicles sold/cars registered and match that with the waitlist numbers they are sending to customers.

Here's what BHPian Joyb had to say about the matter:

Trust me Toyota is totally hands in glove with all these corrupt practices. We had booked a ZX at the time of launch in November 2022, till date there is no sign of the car. Repeated mails to the dealer and Toyota generate no response or standard deceiving replies.

Now here is the interesting bit, one of my friends wanted to buy ZX 20 days back, got in touch with a DSA, paid a premium of around 2 lacs and voila, 15 days he got his HyCross ZX. Received direct calls from Toyota for various formalities, wherein in between the discussions the lady admitted that while bookings for ZX/ZX(O) are closed, they take booking of VX and show it as an upgrade.

What a mockery. I have told the family to cancel the booking as I have lost trust in the company.

Here's what BHPian Vibhav-Van had to say about the matter:

Typical black marketing scenario which reminds us of our license raj era.

The unfortunate part? A brand like Toyota, with a huge fan following in our country is resorting to this. Never expected this from the likes of them, because everyone raves about their customer-centric approach. Not sure if this holds true in this case.

Another perspective - If customers are indeed willing to pay that kind of a premium, should they officially jack up the prices by 3-4 lakh and ensure black-and-white profit from it? I know we will criticise them for being greedy, which they already are. But at least that's legal.

Guess it all boils down to what we as buyers prioritize. Go out of our way to encourage such practices for a car we love (Tbhp car of the year), because the purchase happens only once, but you live with it for years - and that experience matters most. But even in that scenario, are you sure this brand will not resort to such malpractice in the after-sales experience?

Or value ethics and goodness, and pick an alternative (if there is one).

I do not have first-hand experience with Toyota except when we went to TD a Hyryder last year, and that was nothing great. With respect to ownership, I've experienced Fiat, Ford and Skoda so far. Fiat was the absolute worst - looking to rip you off at every moment. Ford was such a darling - that's true goodness from the heart. I value that, personally.

Here's what BHPian IamNikhil had to say about the matter:

You are absolutely spot-on! It is highly unlikely that the Toyota India management is blissfully unaware of these shady practices; rather, in all probability, the senior honchos are willfully turning a blind eye to these under-handed dealings, whereby the dealers are happy.

Also, there is a possibility that the cut from profits is shared across all levels. Who doesn't like a little side income, that too tax-free? The appalling fact here is that they are doing so in broad daylight. Heart goes out to customers who are eagerly and patiently waiting for their deliveries, ready to spend their hard-earned money; while some with access to unaccounted resources and greasing-of-palms are taking them for a ride, literally and figuratively!

Check out BHPian comments for more insights and information.

Redlining the Indian Automotive Scene