Automobile giant Maruti Suzuki blamed the increase in ownership prices as the main reason for slowing down sales. In addition, a complicated situation because of the strict lending requirements of banks and the confusion resulting from BS-VI cars has made life difficult for car companies.
This outlook comes as Finance Minister Nirmala Sitharaman commented that a change in vehicle ownership policy has been sent to conglomerates like Ola and Uber as a result of the sale of cars. The auto industry is insisting on the reduction of goods and services tax (GST) to revitalize demand.
"Although we saw a growth of nearly 26 percent in the first four months of last year, the end of the year was down to 3 percent. In April, there was no scope for new sales vehicles as the pipeline started to ship. cut off. I think the main reason for this is an increase in the price of car ownership, ”said Shashank Srivastava, chief executive, marketing and sales, Maruti.
Srivastava added that traffic tax on roads, coupled with an increase in production costs, in line with BSVI regulations, has resulted in road prices rising by an average of 14-15 percent.
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In some counties, where tax increases have increased, road prices have increased by more than 20 percent. This is primarily influenced by the lower entry level which is of great value. The 1 per cent price tag also affects sales, ”he said.
As homeowners' prices went up, bank lending also became more difficult after the IL&FS crisis, and banks were worried about the transfer.
We are talking to banks to treat customers better with a record of payment differently without asking for a loan agreement. In some cases we have succeeded, ”Srivastava said.
According to the Indian Automobile Manufacturers Association (SIAM), real estate sales in August fell 23.55 percent to 18,21,490 units from 23,82,436 in the same month last year. From April to August, sales dropped 15.89 percent to 97,32,040 units from 1,15,70,401 units a year ago, SIAM said. Maruti is trying to avoid the problem by discounting its cars in popular models like Baleno, Ciaz and Swift.
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In her model Nexa, Maruti presented a lab of services. Apart from the recently launched XL6, there are many different plans for convertible waivers, corporate offerings and free extended warranty.
“The biggest issue with buying a car is feeling good. Since feelings are negative, we try to create a positive sense to stimulate the market through discounts. I think this is the best time to buy a car, ”Srivastava said.
He said that Maruti would immediately execute the offers and would not conduct a fire sale to clean BSIV shares near BSVI's implementation.
We have already produced seven of our most popular models, which are BSVI compliant. Therefore, we are already in the process of cleaning the BSIV stock. "We may have shares to buy fire near the implementation date of April 2020 (for BSVI)," Srivastava said.