Smartphones to gold coins, all to sell cars

The kind of gifts that came along with the car they bought were fabulous: BlackBerry smartphones, DVD players, LED televisions and digital cameras. Ford gave away these to its customers under a midnight sale scheme on Sunday, but the US auto giant is not the only one among the manufacturers in the field to launch sales promotion of this scale this season.

Most players in the field know they have to go a bit out of the way to woo potential customers and battle a slump in the market.

The attraction needn’t always be prizes. Japan’s Nissan, for instance, cut the price tag of its Micra model by more than Rs 40,000. Bangalore-based Toyota Kirlosakar is luring buyers with free gold coins, while Germany’s Volkswagen is ready to pay the insurance bill of the car along with handing over a range of free car accessories.

 

Others, such as Maruti Suzuki, Honda Siel, Tata Motors, General Motors and Hyundai Motors, are also running consumer benefit schemes, including low-interest loans. Some of them beat the car loans that banks offer at levels that are near to an all-time high.

WINDFALL FOR CUSTOMERS
Company	Model	Offer
Ford	Fiesta	Rs 75,000 benefit
Nissan	Micra	Rs 40,000 discount
Skoda	All models	Finance at 9.99%
Volkswagen	Vento, Polo	Rs 40,000 discount
Toyota	Etios, Liva	Free Gold Coin, Insurance
Honda	City	Free Insurance, Rs 40,000 benefit
Source: Companies

True, it is a norm for almost all car companies to offer discounts at this time of the year. Even so, such benefit schemes — market watchers and dealers believe — are this time particularly higher than those offered in many of the previous years.

Reasons? “Well, footfalls in showrooms are negligible; even enquiries have slumped,” says a Mumbai-based Maruti dealer. “Consumer sentiments have certainly taken a knock. We are forced to shell out the cost of extra accessories from our own pocket. Companies have understood this. That is why you see increased discounts.”

The slump in demand hasn’t spared even newly launched models such as Hyundai’s Eon, Ford’s Fiesta and Toyota’s Etios and Liva. To spruce sales, companies are forced to give away discounts on some of such models.

Ford, for instance, is offering a cash discount of Rs 75,000 on the premium mid-size sedan Fiesta. It is now available at Rs 7.5 lakh as against its launch price of Rs 8.23 lakh. This discount was recently upped from Rs 50,000 earlier. Ford’s all-new Fiesta is less than five months old in the market, having been launched in mid-July.

Business Standard sent a detailed questionnaire to Ford India on the steps the company has taken to reignite consumer interest in its cars, but that remains unanswered.