Industry

In a grim market, options galore to snap up cars

Indian security men walk past the parked Nano cars at a Tata Motors manufacturing plant at Sanand near Ahmadabad, India, Sunday, Dec. 19, 2010. Sales of the ultra-cheap Nano car, plunged by 85% in November compared with a year earlier, news reports said.(AP Photo/Ajit Solanki)

Indian security men walk past the parked Nano cars at a Tata Motors manufacturing plant at Sanand near Ahmadabad, India, Sunday, Dec. 19, 2010. Sales of the ultra-cheap Nano car, plunged by 85% in November compared with a year earlier, news reports said.(AP Photo/Ajit Solanki)   | Photo Credit: Ajit Solanki

Faced with a deadly cocktail of high interest rates, dearer petrol prices and a slowing market, automakers are now experimenting with ways to push up sales, including easing the process of buying.

Take the latest offer from Tata Motors. One can simply swipe his or her credit card and take a Tata Nano home the very same day — the buyer getting an option of converting the entire amount into 12 monthly instalments of Rs. 8,333, interest free.

Slippery car sales have affected companies, dealers and financiers alike. So much so that five banks — Axis Bank, ICICI Bank, HSBC Bank, Kotak Mahindra Bank and Standard Chartered Bank — have decided to partner Tata Motors for the special scheme. Only customers of these banks with credit cards can avail themselves of the offer.

Another scheme from the company involves giving the buyers a more appealing and easier option. Manza sedan owners will receive 60 per cent of the purchase value if they re-sell the car to the company after three years. Innovation and quirky deals, however, remain the name of the game. Volkswagen, for instance, is offering a scheme in which buyers can trade an old car for a new Vento Sedan by paying just Re. 1 and nothing at all for the next one year.

Nissan, on the other hand, has jumped in with the ‘lowest EMI challenge,’ claiming that if customers find an EMI lower than the company’s it would refund the difference immediately. “The way we look at is that we can’t help reduce fuel prices. What we can do is lower the burden on the individual, who has become more and more indecisive owing to an uncertain market, which we have done,” a Nissan spokesperson said.

While such offers will keep spilling out, as the car market continues to weaken, caution needs to be exercised, feel analysts. “For the customer, most of these advantages are great. If consumers take a loan normally, they don’t directly own the car. In the case of the Tata Motors offer, there doesn’t appear to be a strict collateral requirement, which makes the process easier,” said K. Mahalingam, partner, T.S Mahalingam and Sons.

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Printable version | May 28, 2020 12:11:42 AM | https://www.thehindu.com/business/Industry/in-a-grim-market-options-galore-to-snap-up-cars/article4482555.ece

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