Mercedes-Benz India initiates its new state-of-the art facility

 

Reiterating its position as the luxury car manufacturer with the widest & largest network presence in the country, Mercedes-Benz India today formally inaugurated its state-of-the art facility in Andhra Pradesh, - Mahavir Motors -in Hyderabad located at Kavuri Hills. This new facility was inaugurated by Peter Honegg, Managing Director & CEO, Mercedes-Benz India and Yashwant Jhabakh, Managing Director, Mahavir Motors.

Peter Honegg, Managing Director & CEO, Mercedes-Benz India commented: “Mercedes-Benz invented the automobile 125 Years ago and till date our guiding philosophy has been to offer our customer ‘the Best or Nothing’. Mahavir Motors have been our able partners and have successfully represented the Mercedes-Benz brand in this market, offering best in class services & establishing a world class car ownership experience for our customers in Andhra Pradesh for over a decade now. With the inauguration of the new facility, we have now moved closer to our esteemed customers to give them a premium vehicle ownership experience. The sprawling facility, the magnificent ambience and the outstanding service will ensure that we extend the Mercedes-Benz experience to the automobile aficionados of this region. I am sure this state-of-the-art facility will go a long way in further enhancing customer delight and provide them the unique attributes that brand Mercedes-Benz brand stand for globally.”

Created over a span of ten months, this sprawling new showroom is spread over an area of 17,500+ sq. ft including the well structured showroom and the workshop. Located in the hub of the city at Kavuri Hills, the facility has been established with an investment of Rs. 100 million (10 Crores). The new facility has been conceived to offer an exciting ‘Mercedes-Benz experience’ for customers: drive-in valet service, luxurious customer lounge, Café Mercedes along with a wide range of vehicles on display. The accessories and wheel configurator, engaging audio-visual presentation, boutique collection and special play area for children are the latest highlights of the new facility. The facility also has over 30 committed and qualified personnel to cater to sales, after-sales and service and give the customers an enriched ownership experience. Equipped with high quality Mercedes-Benz equipments and trained manpower, the workshop has been built at par with the brand’s global benchmark. In addition the new facility will offer the ‘Proven Exclusivity’ program with its range of pre-owned Mercedes-Benz cars.

Yashwant Jhabakh, Managing Director, Mahavir Motors: “Till date, Mahavir Motors has sold an estimated 2200 units of Mercedes-Benz cars in Hyderabad and Andhra Pradesh of which 275 units were sold last year alone. Each month, we service more than 150 cars. With our deep experience of the market, robust infrastructure and trained manpower, we are confident of providing our customers with an unmatched ownership experience. With the new showroom, we shall position ourselves even more attractively in the market.”

With establishment of the facility at Hyderabad, Mercedes-Benz now enjoys a network spread across 28 cities with over 57 touch-points in India and retains the distinction of being the leading luxury car manufacturer with the widest and most intensive network of sales and after-sales services in India.

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Japan Tsunami affects Indian auto industry growth

The 8.9 magnitude earthquake and the resulting Tsunami that destroyed the entire East Coast of Japan yesterday, is going to affect the Indian auto industry too. India is probably a battle turf for Japanese auto makers.

Suzuki, Nissan, Toyota, Honda and Mitsubishi all have huge set-ups in India. These manufacturers import parts and accessories from Japan. But, due to yesterday’s disaster, thesirsuppliers in Japan have stopped operating and shut their manufacturing units.

India’s largest car maker, Maruti Suzuki India, which sells every second car in the country, too relies heavily on these suppliers in Japan. Mr Shashank Srivastava, Marketing Manager, MSI, stated, “We are assessing the impact on vendors that supply to our parent company Suzuki Motor Corp.”

Suzuki Motors has a 55% stake in MSI. Even Honda Motors relies heavily on Japan for the parts of their luxury sedan Accord. Honda is set to suffer in near future due to the shutdown of their plant in Saitama.

Auto sales hit a speed bump

There’s no doubt that January and February saw rising passenger vehicle sales compared with both the preceding month and a year before. In fact, after it bucked the global recessionary trend with about 26% volume growth in fiscal 2010, this segment is expected to close fiscal 2011 (FY11) with a 30-33% growth.

But, blame it on capacity constraints, vendor paucity or the higher base effect, indications are that the growth rate for the segment would taper off in the coming months. Car dealers of some leading brands are offering either cash discounts or freebies in the form of insurance or accessories. A recent report by HDFCSecurities Ltd said: “Though industry has posted strong wholesale numbers (20-30% year-on-year) in (the) last two months, retail sales have declined by 3-7% in certain regions. This has, in effect, increased the average inventory levels in network from 10-15 days couple of months back to 25-40 days at present.”

To reduce retail stock, car makers are trying to push sales in March. Some dealers said customers are deferring decisions to buy cars, mainly due to higher interest rates, which have increased by two percentage points in the past nine months. Further, there is heightened competition in the small and mid-size segments with the entry of new global firms. The only buoyant segment is utility vehicles, which is a new segment in the Indian market. Car makers are, therefore, offering discounts to grab or retain market share.

Naturally, this isn’t good for profits. The industry is already faced with near-term challenges such as rising commodity costs, staff costs, tighter liquidity and competition, which are squeezing profit margins. For example, for the December quarter, Maruti SuzukiIndia Ltd’s operating profit margin (OPM) dipped by about 5.7 percentage points compared with a year ago. Likewise, TataMotors Ltd’s improved performance was driven mainly by its overseas subsidiary Jaguar Land Rover. Its stand-alone OPM was down by 2.35 percentage points from a year before.

Analysts have forecast a growth rate of about 12-15% during fiscal 2012, less than half of that clocked in fiscal 2011. A report by Icra Ltd points to a solid, but less euphoric future. “The Indian passenger vehicle industry will reach about 4.85 million in annual sales by FY16, representing a growth of 10.8% CAGR (compounded annual growth rate) over the next five years,” it said.