Covid times: Own a new car with­out buy­ing it

The Asian Age - - Financial - MICHAEL GONSALVES

To counter dip­ping sales from deal­er­ships in this Covid-in­duced chal­leng­ing times, car­mak­ers have rolled out leased sub­scrip­tion-based car ser­vice as an al­ter­na­tive rev­enue stream.

So, now you don't have to own or hire your favourite car. You can sim­ply lease and sub­scribe one for a min­i­mum pe­riod.

With ris­ing fuel costs, in­ter­est rates and rapidly de­pre­ci­at­ing value, the leased sub­scrip­tion model by car­mak­ers allows you to own a brand new ve­hi­cle at zero down pay­ment but at a fixed monthly sub­scrip­tion fee and the fuel cost. Car firms take care of in­sur­ance, road tax, and main­te­nance.

Car­mak­ers such as mar­ket leader Maruti Suzuki, Hyundai, Mahin­dra, Volk-swa­gen and MG Mo­tor are en­tic­ing cus­tomers with their own lease sub­scrip­tion mod­els.

Un­der the 'Maruti Suzuki Sub­scribe' brand, the com­pany has tied up with Orix Auto In­fras­truc-ture Ser­vices, a sub­sidiary of Orix Cor­po­ra­tion, Ja­pan, to launch the sub­scrip­tion ser­vice in In­dia.

The ser­vice will be­gin as a pilot project in Gu­ru­gram and Be­na­galuru and will be ini­tially avail­able on Swift, Dzire, Vi­tara Brezza and Er­tiga mod­els from the Maruti Suzuki Arena chan­nel and Baleno, Ciaz and XL6 from the Nexa chan­nel, the com­pany said in a reg­u­la­tory fil­ing on Thurs­day.

Giv­ing a rough idea of the sub­scrip­tion price, Shashank Sri­vas­tava, ex­ec­u­tive di­rec­tor, mar­ket­ing and sales at Maruti Suzuki In­dia, on Fri­day told Fi­nan­cial Chron­i­cle that "in Gu­ru­gram the has­sle­free fixed monthly rental for Baleno, Dzire and Er­tiga is Rs 24,000, Rs 26,000 and Rs 34,000, re­spec­tively."

It archri­val Hyundai Mo­tor, In­dia's sec­ond big­gest car maker, had last year launched its sub­scrip­tion model across In­dia as part of its part­ner­ship with self-drive car­shar­ing firm Revv.

The min­i­mum lease rentals, for in­stance, for Hyundai Santro, Venue and Creta are Rs 7,673, Rs 15,488 and Rs 17,642, re­spec­tively. Hyundai Sub­scrip­tion pro­vides the cus­tomers to opt for flex­i­ble own­er­ship plan that in­cludes sub­scrip­tion for short term / long term, swap across Hyundai range and zero down pay­ment, No in­sur­ance/ main­te­nance for short sub­scrip­tion, in­clud­ing an as­sured-on demand de­liv­ery. Cus­tomers opt­ing for one-year sub­scrip­tion or more will get an as­sured new car. Sim­i­larly, MG Mo­tor

In­dia also of­fers its sub­scrip­tion ser­vices through a strate­gic tie-up with Myles, the car shar­ing and car sub­scrip­tion com­pany from Car­zon­rent.

"We charge only Rs 40,000 per month for sub­scrib­ing to MG Hec­tor SUV," an of­fi­cial from the MG Mo­tor In­dia told FC, adding that charges are lesser for 6 to 60 months sub­scrip­tion.

Mahin­dra & Mahin­dra ve­hi­cles are avail­able in Delhi-NCR, Mum­bai, Pune, Ben­galuru, Hy­der­abad, Kolkata, Chandigarh and Ahmed­abad at a sub­scrip­tion price start­ing from Rs 19,720 per month.

Škoda In­dia said its monthly lease rental for the Rapid, Oc­tavia, Su­perb, and Ko­diaq will start at Rs 19,856 and cater to salar­ied in­di­vid­u­als, pro­fes­sion­als and com­pa­nies.

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