dealer discussion

8/4/2019 Dealer Discussion

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Petrol hike is public transports gainPublished: Friday, Sep 23, 2011, 13:53 ISTBy Chaitra Devarhubli| Place: Ahmedabad | Agency: DNA

The recent hike in petrol price has forced commuters in the city to take public transport and avoid privatetransportation as far as possible. This has benefited the city's public transport system.

The recent hike is the second price hike in four months.Now people are coughing up Rs71.2 per litre of petrol and feeling the pinch.While they are a worried lot,

AMTS (Ahmedabad Municipal Transport Services) and BRTS (Bus Rapid Transit System) are happy as

both services are witnessing a rise in their revenue. More people have started considering taking a bus to

deal with petrol price hike.

BRTS of Ahmedabad Janmarg Limited (AJL) witnessed a growth of 6.8% in its revenue just a few daysafter the price hike. As per the figures shared by an AJL official, the total number of passengers using

BRTS was 1.39 lakh on Friday and this rose to 1.41 lakh by Monday thus indicating an increase of 2%.

"On Thursday, AJL recorded an income of Rs8.16 lakh which rose to an amount of Rs8.72 lakh on

Monday, indicating an increase of nearly Rs55,000," said the AJL official.

AMTS officials shared some figures on the rise in revenue of AMTS and said, "In August we witnessed

an average income of Rs24.5 lakh per day. Surprisingly, in the current month, we have been registering

an income of Rs25 lakh per day on an average indicating a growth of 2%, all thanks to the petrol pricehike."

An Amdavadi who switched to BRTS said, "I commute to my office at Shivranjini daily from Naroda.

Now I have changed my mode of transportation."

Biodiesel

The festive season is around which car will youbuy?Published: Saturday, Sep 3, 2011, 12:32 ISTBy Team DNA | Place: Pune | Agency: DNA

Theres a lot of excitement over the car market in the country

today. Popular projections suggest that the booming auto

sector will soon overtake the IT sector, as one of the front-ranking growth segments of the economy. Last year, we saw a

30% growth in passenger vehicle sales and more than 2.5

million cars were sold according to SIAM- the Society of

Indian Automobile Manufacturers. The low cost sub-compact

group grew by 32.69% and not just the B-segment cars but
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even the luxury-end limos registered very good demand.In

2010, we had 25 auto firms launching operations in India, so

that sets the tone of whats happening in the country. If we are

to look at the market from the buyers point of view, then

theres a huge variety to choose from. But at the same time,

there are concerns about the reach and quality of after-sales-

service and rising fuel costs. Attractive mileage and whether

to opt for diesel or petrol versions are also questions

uppermost for buyers.

Team DNA engaged leading auto dealers from Pune in an

interesting conversation to share perspectives on whats

happening in this segment.

Speakers:Sunil Arlikatti,CEO, Deccan Honda (dealers for Honda)

Shirish Kulkarni, CEO, J Director, DSK Toyota (dealers for

Toyota)

Kaushik Kothari, CEO, J MD, Crystal Honda (dealers for

Honda)

Jay Shah, Executive director, Vidyut Motors (dealers for

Renault)

Soumen Chaudhuri, CEO, J Williams (dealers for MitsubishiLancer & Pajero)

Here are the excerpts:

DNA: What is the mood of the market today in view of the

hike in interest rates and rising fuel prices? What does the

buyer want? Has the buyer become very demanding today?

Jay Shah: We dealers faced a problem with the Indian market

moving very fast and foreign technology coming very fast, but

the customers are not maturing fast enough. The market isslowly beginning to mature with the entry of many players,

whether you go from basic A segment to D segment or even

further.

Customers now know to some extent that they have to make

choices within the same category of cars. This is an


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improvement and makes our job easier.

I feel in the print media, the columns on cars must talk about

how to save money, rather than compare features of one model

with the other. For example: how can one save money oninsurance? Insurance can be discounted to 20%-30 %, if we

have to cut-off the middleman. If we dealers also do insurance,

we have to employ people for the service, have to ensure that

you get the service and for this we will take some margin of

commission.

Shirish Kulkarni: There is a very big movement in the market

but there is a need to educate customers. There are certain

people who try to compare two models or two different

manufacturers, without having much knowledge. For example,

you cannot compare Etios with Honda City, but people do

compare.

On a macro level the manufacturers must look at educating

customers on how various segments are divided. In India,

nobody had explored the D segment until recently, which

came in much later. Today customers have moved on to buying

cars worth over the Rs3 crore tag. The market is shifting veryquickly.

Kaushik Kothari: As said rightly, the customer is becoming

more and more demanding. Five or six years ago, we used to

talk of very few features like air bag and integrated music

system. Now all the safety features have even surpassed the

expectations of customers that they had five years ago. Now

the customer looks for something else. The customer is going

to become more and more demanding as days go by. I think themarket trend is going to be such for the next 20 years because

India is a

developing country.

Soumen Chaudhuri: I feel there is an amazing trend in the

market. Inspite of all sorts of financial crises around the world,


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you see a robust Indian automobile market with a steady

growth. I think India is set to become the biggest market after

China. We have the buying power, we have the numbers.

What I see in metros like Pune today is a sudden demand for

high-end cars and SUVs, which is good. However, the Indian

customer or the masses will

always go for mid-segments or small cars because we are very

conservative in our upbringing. We dont go and spend on

something we cant afford. I feel, the mid-segment and small

cars will be our future.

DNA: The concept of brand loyalty has changed. What is

really happening in the market? Which segment is growing

very fast?Jay: Loyalty for Maruti has diluted because so many entrants

are coming in their forte of small cars. At the same time,

Maruti has its loyalty because they have such a big range and if

someone wants to change, they have an option to choose

within the Maruti family itself.Honda and Toyota are in India

for a long time. So any new entrant has to have that matching

quality as well as something more to offer. When there are so

many new options for customers, they are willing to try; theywouldnt have tried if brand loyalty was so predominant.

DNA: What about hatchback segment?

Kaushik: The hatchback segment has just entered as two years

is not a very big time period. The B+ segment is definitely

increasing because of greater urbanisation, greater demand and

convenience. In fact, the latest trend is that automatics are

selling very well.If you compare any of the developed markets,

the Jazz better known as Pit in the US is one of thehottest selling models in the hatchback segment in the US,

even in Dubai for that matter. These are priced higher than the

City in developed countries. The reason being that the Jazz is

completely an urban car in terms of space. In terms of engine it

carries the same engine worldwide except in India where it is


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1.2-litre engine and that is the reason the Jazz was priced at

Rs8 lakh initially. It was carrying all the elements of Honda

and with lot of parts and components that were imported at that

point of time. Now with the localisation a price correction has

been done. So I think the Jazz is a brilliant car and now with

the new price tag, it would not have to look back.

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Shirish: India is developing into a market like the US, where in a family of four, you have four cars and the fifth car is for the familydog. This is happeningbecause the economy is growing so fast. The IT and the real estate sector have grown so rapidly that corporate level people likemanagers getting a package of Rs50,000 to Rs60,000 a month, can easily afford a car worth Rs8 or 10 lakh.DNA: How is your brand positioning in the market and which are your best selling models?Shirish: Toyota has a very strong positioning in the market. Since its been around for 11 long years, they have established theirreputation on quality and customer satisfaction. Brand positioning for Toyota is extremely strong andpeople have recognised it as agood brand.When Toyota Qualis was introduced in India, Toyota made it very clear that one has to drive the vehicle in order to know why theyhave got the vehicle into India. Innova has been making history. We have a waiting period of eight months for Innova. It has been abestseller for a very long time. Toyota Etios is also picking up very well and now we have the petrol version, already out for bothEtios and Etios Liva. Etios and Etios Liva have also shown a very steady growth.

Jay: Renault is one of the oldest car makers in the world. Even though it is in alliance with Nissan worldwide, in India, Renault andNissan have come separately. Their technology for suspension, for interiors, for travel comfort and reliability is their USP. Within thenext 18 months they will be coming with five models in petrol and diesel. It has a range right from Rs4 lakh to over Rs25 lakh. Theyare here to catch up with everybody.Kaushik: Honda City has been our hottest selling model. This car has spoken for itself all throughout. It has won nine consecutiveawards and is the only one with this distinction. Secondly if you compare any Honda product, Honda in itself looks at driveability,reliability and quality. Honda will never compromise on these three factors and its products rank high on space, low maintenanceand high fuel efficiency which are important for customers. Honda is definitely ahead of its time in terms of technology and quality.Sunil: Ive been with Honda for 12 years and Deccan Hondas spread over the city has been commendable. We used to sell 25 carsa year in 2000. I then had six sales consultants and I was the manager;today, I have four managers and 45 sales consultants and Iam the CEO. So the spread of our showrooms in the city speaks for Hondas strength as a brand.Soumen: At J Williams and Company, we have been associated with Hindustan Motors for the last 60 years. So, from Landmaster

to Ambassador, to now Mitsubishi, that is a relationship that our owner, Mr Irani does not want to break under any circumstances.There have been ups and downs. Mitsubishi as a product is wonderful as it is a Japanese product. Apart from being fuel-efficient, itis low cost on maintenance, and high quality structure.Pajero is very popular and is a brand that is yet to catch up in the market. Welaunched Outlander two years ago and are coming with Pajero Sports this year.DNA: Finally, what is the average car buyer looking for in terms of fuel efficiency, style and design? What factors shouldone consider before going in for a purchase?Kaushik: My advice to customers looking for a vehicle below Rs10 lakh, and while deciding between the petrol and diesel versionsis to consider the approximate driving mileage in an entire year. If it is more then 40,000 km in a year, then it makes sense to go fora diesel car. The initial cost of procuring a diesel car is higher than a petrol car. Cost of maintenance of a petrol car is lower than adiesel car. You get a higher resale value for a petrol car than a diesel car. When it comes to maintenance, one must remember thatJapanese cars are low on maintenance. Such cars have a high resale value.Shirish: Look at the brand, look at the history of the brand and look at how they have been placed worldwide. One must also look athow they tackle their problems and how they have managed to overcome them. In my experience whatever 60-year history Toyotahas, it has never faced a large issue like the other manufacturers. Their competency level in the cars is high, which is why they are asingle brand and rank number one in volume sales. If you have a good dealer in your territory, who will assure that he will give yougood after sales service, you should buy any model from him.

Jay: In terms of deciding between diesel and petrol, the pragmatic thing to do is to consider your daily running. If is it 40,000 km peryear, which is about 100 km a day, then go for a diesel version. From resale point of view, you can put a gas kit on a petrol car, so abuyer has the option to put CNG or LPG, whereas you cant do that in a diesel car. The resale value forpetrol car is better.
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