Photographs: Courtesy, Tata Motors Swaraj Baggonkar in Mumbai
It is raining offers in the passenger car segment. And the latest to warm the cockles of consumers is Tata Motors.
The company, in a bid to pep up subdued market sentiment, has come up with a novel offer. Those who buy the Manza car can sell it back to the company after three years, at 60 per cent of the current purchase price.
On Monday, the Mumbai-based company had announced a price cut of up to Rs 50,000 on Indica and Manza range of cars. That, along with Tuesday's offer, Club Class Buyback Assurance programme, is expected to arrest the falling sales of the company.
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Complete coverage: Union Budget 2013-14
It's raining discounts on your favourite cars
Photographs: Courtesy, Chevrolet
Tata Motors is not alone to offer price cuts. General Motors (GM), too, has made a tall price cut of Rs 30,000 on its four months old hatchback Chevrolet Sail U-VA. Response to the premium compact car Sail U-VA has been lukewarm since its launch in November.
The Sail U-VA now starts at Rs 419,000 (ex-showroom, Thane) as against its earlier price of Rs 449,000 (ex-showroom, Thane).
Response for the hatchback dipped when GM launched the Sail sedan based on the same platform last month at Rs 499,000.
The slowdown in demand has not spared even the diesel models, which were best-sellers only a few months ago.
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Complete coverage: Union Budget 2013-14
It's raining discounts on your favourite cars
Photographs: Courtesy, Maruti Suzuki
Besides the regular cash discounts on the SX4, Maruti Suzuki is offering 100 litres of free diesel with its Swift and DZire models and other consumer benefit offers.
Japanese car makers Toyota and Honda are giving away corporate discounts, cheap insurance packages and cash discounts throughout the week.
Struggling German car maker Volkswagen is doling out benefits of up to Rs 50,000 on the Polo (hatchback) and Vento (sedan). The Volkswagen Vento carries a cash discount of Rs 30,000 in addition to free insurance.
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Complete coverage: Union Budget 2013-14
It's raining discounts on your favourite cars
Photographs: Courtesy, M&M
Other car makers such as Nissan, Renault, Hyundai and Mahindra & Mahindra, too, are struggling to find new car buyers, forcing their dealers to offer discounts ranging from 5-10 per cent based on the cost of the car.
During the April-January period, the passenger car segment reported a fall of 1.8 per cent to 1.55 million units against 1.58 million units sold in the same period last year.
Looking at the subdued situation, the Society of Indian Automobile Manufacturers has predicted a flat to negative growth for the next year.
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Complete coverage: Union Budget 2013-14
It's raining discounts on your favourite cars
Photographs: Courtesy, Volkswagen
"Several car producing facilities are operating at half the rate of their installed capacities at present. Consumer interest in new cars has taken a massive hit and dealers are carrying huge inventories. Companies or dealers will have to go discount offers to clear stocks," said a Mumbai-based analyst.
With the price difference between diesel and petrol increasingly coming down, companies are reworking their pricing strategy with regard to the diesel models.
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Complete coverage: Union Budget 2013-14
It's raining discounts on your favourite cars
Photographs: Business Standard
All companies that procure their diesel engines locally are trying to make the variant cheaper and make it competitive, compared to petrol variants.
Discounts and other offers are mainly limited to cars, as sports and multi utility vehicles have beaten the slowdown and continue to mark a robust growth in sales.
The segment reported a rise of 57 per cent in the April-January period at 451,935 units, compared to 288,093 units sold in the same period last year.
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