BMW India launches BMW Xpo with attractive finance schemes

BMW 5 seriesBMW India has launched the “BMW Xpo” at BMW dealerships across India until 28 October 2008, where prospective and existing customers can test drive the range of BMW cars at all BMW India dealerships during the BMW Xpo2008.

During the BMW Xpo 2008, special financing and leasing offers have been launched by BMW Financial Services in conjunction with ICICI Bank and ORIX Auto Infrastructure Services Ltd. Prospective BMW car buyers can also avail special insurance offers from Bajaj Allianz. ICICI Bank will exclusively offer “Fixed Interest Rates” instead of “Floating Interest Rates” to all loans logged in for BMW customers. Attractive offers on the BMW 3 Series include “Zero down payment” option for select customers through ORIX Auto Infrastructure Services Ltd, Interest free option for a fixed period of time, Lower fixed interest rate of 15% from ICICI Bank, and a special discount of 30% on a basic insurance policy from Bajaj Allianz.

During the BMW Xpo 2008, BMW India dealerships will also display a wide range of BMW lifestyle accessories that extend from classic BMW lifestyle products such as BMW shirts and jackets, sports products in golfing, kids’ mobility equipment, car miniatures, original accessories, baggage and luggage.

"Carnation Auto"- India's first independent multi brand auto sales & service venture

Former MD of Maruti Suzuki, Mr. Jagdish Khattar today announced his next venture - Carnation Auto. With a vision of developing India's largest independent multi-brand automobile sales and service network, he also announced the company's first round of funding of over Rs.100 crore from marquee names in the industry such as PremjiInvest and IFCI Ventures.

New car sales are projected to be 3 million and the car park 19 million by 2015. To meet the needs of these customers, an incremental investment of Rs.12,000 to Rs.15,000 crores is required in the network, which would be challenging in the existing franchise model. Upto 60-70% of car owners go outside of the manufactures network post warranty. Carnation would provide an alternative to these customers as well as families owning multiple brands, fleet owners and corporates- all under one roof.

"Our Auto Solution Hubs will provide everything a car owner would need to maximize his ownership experience." Elaborating on his vision for Carnation Auto, Mr. Khattar said, "The multi-brand concept will allow us to provide automobile manufacturers, especially new entrants and those with limited market share, small car park & capacity constraints, a more efficient route-to-market through faster nation wide retail presence, scale efficiencies and servicing support."

According to Mr. Khattar, initially the company will focus on providing service, mechanical repair and body shop solutions across its facilities. The service and parts markets is valued at just under Rs.15,000 crores. Carnation's pioneering venture of setting up a chain of auto solution hubs across the country is in an advance stage of its execution plan. Carnation plans to launch its service and sales network in 100 locations across 65 cities throughout India over the next 5 years. The first few Auto Solution Hubs would be operational early next year, which will include Delhi NCR, Hyderabad and Cochin. The total investment in the project is estimated to be Rs. 1,000 Crores.



In an effort to provide complete auto care solutions to its customers under one roof, Carnation is tying up with leading value added product and service providers for tyres, batteries, car detailing, accessorizing, CNG/LPG fitment and windshield replacement among other things. Carnation will subsequently also develop multi-brand facilities to retail new and pre-owned vehicles. The company is adopting world-class technology, equipment and IT systems to implement transparency and to enhance service quality in the entire automotive sales and service processes. Carnation is in advanced discussions with some leading automobile manufacturers for strategic partnerships with an objective of meeting the service needs of their customers.

PremjiInvest, a fund sponsored by Mr. Azim Premji, has committed to invest Rs. 80 crore to acquire a significant minority stake in the company. Mr. Prakash Parthasarathy, Chief Investment Officer, PremjiInvest, said, "Carnation is addressing several changing needs in the manufacturer- to-buyer relationship through a scalable business model. Mr. Khattar is a visionary who can rewrite the auto industry landscape again - this time in the services chain. We are excited to support the accomplished management team under his leadership and look forward to working together in creating a world class organization." Mr. Prakash Parthasarathy and Mr. Syed Mustafa of PremjiInvest would join the Board of Directors of Carnation Auto.

IFCI Ventures is also investing Rs.28 Crore. " Carnation's plan to set up the country's first multi-brand car sales and service network is a unique business proposition and will fill the gap in this underserved market," said Mr. A.K.Choudhary, Managing Director of IFCI Venture Funds, " Mr. Khattar brings with him tremendous experience, and under his leadership Carnation will strive to achieve the highest standards of customer satisfaction."

Carnation Auto is creating Joint Ventures in some key states with those who have the capability of running successful automobile dealerships in their areas. This would provide Carnation Auto with not only critical local insights but also help in an accelerated roll out of its operations. Mr. Khattar announced that the company has two Joint Venture partners already on board and is in discussions with various others.

To support its service and sales model, Carnation Auto has a wholly owned subsidiary in the infrastructure space, Carnation Realty, which will focus on investing in the acquisition of key properties for the parent company. Carnation Realty will also work on developing and executing new concepts for auto solution hubs, multi-brand showrooms and auto cities. Carnation Realty is in discussions with real estate firms to jointly develop these concepts.

Carnation is planning to set up an Automotive Training Institute, to train automotive technicians, sales and support personnel for the industry. According to the Automotive Mission Plan, the automobile industry will need close to 22 million trained (skilled and semi skilled) manpower by 2016. There is a need for an organized approach to train this manpower for this leading industry. Carnation plans to work closely with government, OEM's and other industry bodies, bringing together best practices with the latest technology to create an industry ready manpower pool for the automobile industry.

Talking about the brand Mr. Khattar said that the Company is named after one of the most popular flowers. Carnation Auto wants to imbibe its qualities of being warm, friendly and inviting. The identity too is built around the essence of the flower but turned around into a graphic rendition to give a vibrant and spirited feel to the brand. The logo contains different shades, which represent different promises to their customers. The representation of a "bouquet" represents a total and comprehensive set of services they plan on providing to their customers to give them a unique ownership experience.



"Carnation Auto is an initiative by Mr. Jagdish Khattar, which is in the process of setting up a state-of-the-art network of integrated multi-brand auto sales, services and related solutions across the country-an industry consolidator attempting to bring automobile dealerships under a standardized business model. It will provide automobile manufacturers, especially those with a limited market share, or those looking for a pan-India footprint but don't have the volumes to sustain stand alone dealerships & other capacity constraints, a more efficient route-to-market through faster nation wide retail presence, scale efficiencies and servicing support. Providing them dedicated outlets within the Carnation network resulting in higher revenues through cross-selling across business lines (new cars, servicing, used cars, accessories, financial and insurance products, auto leasing). "

Used Car Industry: Dr Car Expands Its Business Horizon

Dr Car one of the largest used car organized retailer in India, with a physical presence has now expanded its business services to meet the requirements of today's online customers.

Dr.Car brings to customers the finest car buying and selling experience at the best possible value by connecting buyers and sellers in the most convenient way with the largest inventory of used cars in a single location in India. With its physical presence and its website www.DrCar.co.in, it has gained a lot of trust as the best service provider for the past few years in Used Cars market.

The used car market in India presently is growing at the rate of almost 30% per annum. Fiscal year 2007-08 touched an approx 14.2 lacs of used car sales as compared to 8.8 lacs car sale in the year 2005-06. Nearly 1 Million cars change hands annually, according to the Society of Indian Automobile Manufacturers. With Used Car market getting more organized, Indian Automobile Industry is experiencing a new shift in the business model.

As happening in any other industry, even the used car market is shifting its prominence from physical presence to online presence. The web is the first source for most of the customers looking to buy or sell a car. Today's customers wants the things to be done so quickly, even if it selling a car. The Used car portals provide a great source to meet this pace of customers. Customers along with pace also wants to sell their cars at the best possible price and customers who want to buy used cars wants the best value cars from dealers who are reliable as well in the most convenient way.

To meet these convenience needs of the customers, Dr.Car.co.in has completely revamped its site. The new DrCar.co.in portal provides seamless integration of the online world with our physical locations. This helps us to bring customers the best of both online and the traditional brick-and-mortar showrooms.

Dr.Car.co.in brings together a gamut of features to offer to its customers like Best Quotes, Used car valuation services and more. A buyer of used cars can visit Dr.Car portal and with the help of advanced search functionality can find the car of his choice. The buyer can find the cars available through Dr.Car based on make, model, price, year and location. Once he finds a car which meets his preferences, he can submit a quote. He can also visit the Dr.Car yard and have a detailed look and know all the details of the car. If the seller of the car is happy with your quote, you can drive away your car. If you are a seller of a car, you simply need to create a free account and upload your car details. Your car details will be listed in the site and you will start receiving quotes from prospective buyers, you are at your will to choose the best quote.

Dr.Car also provides lot of information about New Cars. The Finance and Insurance sections in the site provides you detailed info and guides you how to best use them. The research section provides a lot of information about used cars, new cars and the industry news as well.
Dr Car Pvt Ltd is in the process of making its physical presence Pan India by opening its yard facility in other locations in India 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.

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.

Old car or new?

This is totally dependent on your mentality. And of course, there is a price differential. So, it is better that you identify your needs first and then take a call on the one that suits your purposes.
For instance, if you are someone who is looking for a regular upgrade in say, every two-three years, then a second-hand car makes sense. Moreover, if this is your first car and you are trying to learn driving on it, a second-hand car definitely makes much more sense. On the other hand, if you are someone who is happy using the same vehicle for a number of years, then a new car is definitely recommended.
Of course, there are other important parameters like your negotiating skills and the previous owner. For instance, a Parsi owned car commands higher value as Parsis are known to maintain their cars very well. As a Parsi friend confesses, We do not believe in repair? we replace.? Whereas even the latest model in the hands of a Young Turk (a la Schumacher) would create imageries of burning tyres and engine on an overdrive.
Before buying any car, here are a few things you need to consider:
1. What is your budget for the car?
2. What is your monthly budget for the car?
3. How do you intend to use it? Within the city or even outside the city? (Heavy weight age towards the latter means that you need a MUV or multi-utility vehicle like Tata Sumo, Mahindra Bolero etc.)
4. How long do you intend to keep the vehicle? Now that you have answered the above, you know whether you want a new or an old car. But before you go for that old car, get yourself a cool car mechanic that is, a trustworthy one who will check the car for you. Ask him to check all the parameters like tyres, suspension, cooling etc.

Registering a new car at the RTO

Firstly, when you buy a new car, you have to register it with the Regional Transport Office (RTO). Remember that despite taking a loan from a bank, you are entirely responsible for the registration of the car.
Also, every car has its own Certificate of Registration (RC) book that tracks the history of the car. Moreover, as a car buyer, you need to ensure that all the legal forms should be filled in completely and submitted to the right authorities. Say, you live in Mumbai and bought a new car. You need to submit the relevant documents to the RTO under whose jurisdiction your address falls. If the new car is from another state, you will need to obtain a certificate of temporary registration from the RTO. In most places, this certificate is valid only for a very short period, after which a permanent registration number has to be obtained.
While driving the new car to the RTO for registration, take the following with you:
1. Application for new car registration or Form 20
2. Photocopy of the invoice, insurance policy, ration card or telephone bill as proof of address
3. Original Sale Certificate or Form No 23, Sales Tax Receipt, Octroi Receipt
4. Pollution Under Control Certificate from the manufacturer or Form No 22
5. Letter from the financier, in case you have taken a loan to purchase a car, addressed to the RTO asking them to endorse their lien on your car registration certificate book or Form No 34
6. Your PAN number.
7. Imprint of your car’s chassis number.

Repaying a car loan

One of the first things you need to look at while taking a car loan is the monthly installment, popularly known as the Equated monthly installment (EMI). While different banks would give you different quotes depending upon their rules and regulations, you must compare your monthly outflow for the same amount and for the same tenure. Remember that the effective interest rate is a function of the reducing balance method being used to calculate it. Reducing balance is the method of reducing the principal amount being repaid, from the outstanding loan amount. Every time you make a payment, the interest you pay is calculated on balance outstanding principal. Different banks can use different methods like:
Daily : In this method, the principal is reduced every day as if you were making repayment of the principal on a daily basis.
Monthly : In this method, the principal on which you pay interest reduces every month, that is, when you pay your EMI.
Quarterly : In this method, even though you keep on paying you EMI, the principal reduces only every three months.
Yearly : In this method, the principal is reduced finally, at the end of each year. This effectively implies that though you have paid back a part of the loan during the year, the principal outstanding gets reduced only at the end of the year. This simply means that the earlier the principal reduction is done, the lower the amount you will pay to the bank.
Nowadays, almost all banks offer the daily reducing method as it has more or less become a norm in the industry. However, it is better that one is aware of such things while going for a car loan.

Car loan paperwork

Before you drive off in that new car of yours, there are just a few papers that need to be signed. These include the power of attorney which allows the dealer to go to the RTO and register the vehicle for you and transfer of title if you are trading in a vehicle. Read each document carefully for errors. Once you sign on the dotted line, the deal is done. If something does not feel right, don’t sign. Do not feel pressured or obligated to sign just because of the amount of time invested by the salesperson.
Seven steps to negotiate the best car loan deal:
For most Indians, buying a car is a dream that comes second only to the dream of owning a house. This dream has become real for many Indians with the arrival of easy financing for car purchase. The decision to buy a car is, very often, prodded by the promise of easy financing that car dealers advertise. ? Do not compromise, “you can now own a Toyota Corolla for as little as Rs 10,000/ month”, says an advertisement, egging on all with monthly spare money of Rs 10,000 to own the dream Toyota. The mathematics of this foxes the prospective buyer. Is it real? You decide to check with the dealer. You find the offer is real, but the initial lump sum payment would be large. OK, you say to yourself. I’ll manage that. But what is the interest rate for the loan? The dealer tells you it is 11% and you wonder how come it is cheaper than a home loan? You proceed further and discover that this is really in lieu of the cash discount you could otherwise have got. You are no longer sure whether to believe him or not. You are not to blame. Car finance can become complex because of the financing deal between the car dealer and the bank. It will help you negotiate better if you follow the process below: 1) Finalise your decision on the car you want to buy. The interest rates vary from car to car; so, what is available on one car may not be available on another car. 2) Fix the amount of vehicle loan you need. Suppose the car costs Rs 8 lakh on the road and if you are ready to make a down payment of Rs 2 lakh, then freeze your loan requirements at Rs 6 lakh. Interest rates that you get also depend on the loan amount. 3) Ask around for preliminary quotes for the given loan amount for the given car. Freeze on the lowest EMIs that are offered. 4) Now, negotiate on the processing fees. Most times, the processing fees can be waived. 5) Then, start negotiating for cash discounts that can be adjusted against your down payment. The DSAs/dealers will offer to reduce the EMIs, but resist the temptation and insist on a cash discount. Also, the dealer/DSA will offer accessories in lieu of cash discount; again, resist and insist on cash discount. 6) Once you find that the cash discount limit has been reached, you can try for a small freebie on car accessories such as car mats, boot mats etc. 7) Remember to claim your no-claim bonus on the insurance policy for the new car if you have a claim-free record on your existing old car. Happy driving!