Customers consider fewer models before buying cars

In what should ring the alarm bells for car-makers already facing a sales downturn, Indian customers are considering fewer models before making purchase decisions, global marketing information services firm JD Power said in a study.

"Twenty seven per cent of new vehicle buyers in India in 2008 considered at least one other model before purchasing their vehicle, compared with 38 per cent in 2007. This marks the first significant decline in cross-shopping rates since 2005," said JD Power Asia Pacific 2008 India Escaped Shopper StudySM.

The study compared shopping behaviour of two groups of customers -- buyers of recently launched models and buyers of models that have been on the market for more than two years.

For a fourth consecutive year, Maruti Suzuki India performed well in persuading shoppers to purchase the brand, with 38 per cent of all shoppers eventually purchasing one of its models.

Among other vehicle makes included in the study, buyers of Mahindra-Renault and Hyundai tend to shop around the most before purchasing their vehicles, while Skoda and Mahindra buyers were least likely to consider another model in their shopping process, the study added.

"The introduction of several new models into the market during the past few years as well as increased advertising by manufacturers is likely to create greater dissonance in the minds of shoppers and cause them to turn to friends or relatives for reliable advice," JD Power and Associates Senior Director Mohit Arora said.

As a result, consumers were being more decisive during initial stages of the purchase process and fewer car buyers were considering multiple models, he added.

Safe Driving Tips

• Do not change lanes suddenly while driving. Use your indicators to show your fellow motorists that you wish to change lanes or take a turn as the case may be. If for any reason your indicator lights are not working please use hand signals.

• If your vehicle brakes down use help and push the same to the corner of the road so as not to obstruct traffic. Use the hazard warning lights to indicate a brake-down.
  

• Do not leave the keys hanging in the ignition switch if the driver of the vehicle is not in place. ( specially if children are in the vehicle) Always keep safe distance from the vehicle ahead of you to enable you to stop in time if urgent braking is required.

• Ensure no object that you may be carrying is kept loose or unsecured. In an accident or in urgent braking the same may hurt yourself or some pedestrian.
  

• If the vehicle is parked ensure that the hand brake is drawn and the vehicle is in gear to avoid any untoward mishap.
  

• Always ensure that you give right of way to an Ambulance. Please understand that there may be a patient in the vehicle to whom even a minute's difference would mean the difference between life and death. Also the same would apply in the case of the fire brigade.
  

• While travelling, both in the city and on the highway avoid using the High Beam of your headlights if other vehicles are approaching from the opposite side.
  

• Always ensure all the indicator lights and the operating gear of the same is operational. Pay attention to brake lights and headlights.
  

• If you are about to overtake or in the middle of an overtake on a two-laned national highway or a narrow road, indicate to the approaching vehicle with two to three flickers of the headlight, be it daytime or night to let him know of your intended maneuver. If in such a case the approaching vehicle flickers back, don’t overtake. This means he is too close to you for safely carrying out the overtake.
  

• Always obey traffic rules and signals. They are for the benefit of both yourself and your fellow motorists. Also by obeying the rules you will ensure safety and avoid confusion.
  

• Do not use a mobile phone while driving your vehicle, it is dangerous for both yourself and others. If you must speak on the mobile pull over to the side of the road and stop. Or have a hands free attachment that comes on automatically and switches off too.

Car purchase finance options

Financing a car purchase has become rather easy these days. In recent years, a whole lot of financing options have emerged for the potential car buyer. Here we list a few options.

Loan: One of the more famous ways of buying a car is through a car loan. In this case, the car bought through a loan is actually in the possession of the lending institution. The official term used here is “hypothecation” clause?, which basically means that though you own the car, the bank/lending institution is using the car as a security against the loan taken by you. Thus, once you have cleared all the dues, this clause is removed from the agreement.

The self-employed can get tax relief on the interest paid for the car loan (approximately 15 per cent). Also, depreciation to the tune of 10 per cent per annum can be claimed depending on the price of the car.

Hire purchase: In this format, the lender actually buys the car on your behalf and sells it to you on hire purchase. In other words, you hire the car from the lender and own it once you have settled the dues.

The self-employed can get tax relief on the interest paid for the car loan (approximately 15 per cent). Also, depreciation to the tune of 10 per cent per annum can be claimed depending on the price of the car.

Lease: In this case, the car is owned by the financier and leased out to you for a monthly installment, which includes both principal and interest payment. At the end of the lease period, you become the proud owner of the car and the financier transfers the car in your name.

The self-employed can get tax relief on the interest paid for the car loan. However, no depreciation can be claimed as the car is owned by the financier.