N Raja, Deputy MD at Toyota Kirloskar Motor, speaks about initiatives to attract buyers this festive season

Mumbai: The September-October festive season is a period of consumption in India. In that case, it is no surprise that the Indian automobile industry, which has been witnessing a protracted sales slowdown, is pulling out all stops to use this festive season as an inflection point and turn around consumer sentiment. Inquiries at dealerships are still high, but conversion rate is at an all-time low, say industry stakeholders.

“With sentiments muted, people are deferring their purchase of vehicles, so we wait and watch with various innovative schemes for this festive season,” N Raja, Deputy MD of Toyota Kirloskar Motor told ET.

In an email interaction, Raja outlines the initiatives undertaken by the Japanese carmaker to convince potential customers to close the sale.

Edited excerpts:

How different is this festive season going to be from the previous one?

The Union Finance Minister announcing measures recently to boost the auto sector with cheaper car loans, improving liquidity through credit expansion to public sector banks, deferring of one-time registration fees, higher depreciation for all vehicles and lifting ban on purchase of new vehicles in government departments is likely to spur some demand which is a much needed relief.

Apart from discounts, what are some of the unique strategies/offers the Toyota is planning for this festive season?

In this festive season, we are offering 3-year comprehensive ownership solution to our customers, through TOYOTA EDGE. In this program, our customers can pay for vehicle ownership cost in easy monthly instalments, with no recurring payment towards insurance renewal and periodic maintenance for 3 years. TOYOTA EDGE program is inflation proof, as ownership cost for customer remains unchanged for 3 years.

READ  Covid-19 will have unprecedented effect on migrant economy: Dilip Ratha, World Bank


Secondly, we have a scheme called Key4Key. In this scheme, our customers can exchange their existing Toyota vehicles in our U-Trust facility and upgrade to the next Toyota vehicle. In this scheme, we offer flexible finance options to our customers to suit their EMI requirements.

Next, we have Toyota Smart Scheme, a current Innova customer can exchange his old Innova at our U-Trust facility and upgrade to the Innova Crysta at a comfortable EMI through Toyota Smart Scheme.


How much do you expect the prices to go up and what is the scope of discount?

With the advent of BS-VI emission norms kicking in from April 2020, the price of diesel vehicles expected to increase in the range of 15-20%. Market sentiments being low, it is going to be a challenge to sell cars with BS-VI as it will come at a higher price as compared to BS-IV vehicles. In the coming months we expect the market to become better during this transition as some consumers may be wanting to pick up BS-IV cars than wait for BS-VI which has a higher price tag.

What kinds of measures are expected from banks and the government for this festive season?

We appreciate the recent announcements that were made by the finance minister to support the Auto industry. Rationalization of GST structure to a lower level from (28% to 18%) for long term will further support and halt the downturn in the sales witnessed this year

Your overall view on the slowdown and the sentiments towards auto industry before the festive season?

The current slowdown started around mid-last year, the starting point being the NBFC liquidity crisis. This led to slowing down of retails as there were not enough funds in the market for customers to make purchases and especially in Tier II & Tier III markets. High insurance costs, liquidity crunch across the non-banking finance segment, tightening of lending norms, apprehensions surrounding BS-VI introduction and postponement of purchase decision have steered the slowdown in the industry. Registration tax increase by states and additionally road tax increase will have impact, we are happy that it is postponed. We appreciate Prime Minister’s recent remarks that EV’s and ICE vehicles will coexist which should lead to better “ICE” sales, particularly with the advent of BS-VI vehicles.



Please enter your comment!
Please enter your name here