[stanjohn123]

I think countries like Australia , Latin America and other Asian countries must also start increasing taxes on cars exported from India when we ourselves can't reduce taxes on their imported cars.

It's safe to say that the only people benefitting from this kind of transaction are our Indian Auto manufacturers and Indian government. The duty structure was implemented by way of a protectionism for our auto manufactures however this has only been a negative effect as companies like TATA have only used that advantsge to aquire new brands like Jaguar but have done no worthwile improvemrnts to their cars. The only noteworthy brand making decent cars are Mahindra and I'm sure changing the duty structure will definitely not affect them.

Our government though just uses this import tax money shamelessly for their own benefits or as an additional revenue , they will never spend this money to develop the infrastructure or automotive industry.

[F150]

The PMs Independence day speech said come MAKE IN INDIA, but this doesn't seem to have started in the correct direction.

[k_nitin_r]

Originally Posted by Chetan_Rao

I'll repeat what I said in a Ford discussion thread a year or so ago. 'Made for/focused on India' is just corporate-speak for 'Won't sell anywhere else'.

When the Ford Ecosport was being exported despite not having enough units to meet local demand, that's when the 'focus on exports' became more apparent. When firms act to maximize profits (higher profits from exports?) at the cost of losing out to competition in the local market, that makes you give a second thought when considering a purchase of their products. It's not to say that their product is bad, but when you have firms like Maruti-Suzuki that are willing to stand behind every product that they sell and they offer a replacement when a unit turns out to be a lemon, the scales seem to tip in favor of the competition.

[CliffHanger]

We need to be competitive to play in a free market. India is far from it and we have a huge population which doesn't have hi-tech skills but enough skills to do assembly and low level manufacturing.

The current tax structure is not going to change in near future, as free(or very less taxed) imports will kill a huge chunk of employment opportunities in India.

If EU and other developed nations are deciding to considerably tax Indian imports than this is what might happen -

+ves:

- Positives aren't too many. But Indian manufacturers will have a sigh of relief, as every foreign manufacturer move will be too India specific. A lot of deliberations on their part will give ample time to Indian manufacturers to sell whatever they have.
- With demand for cars steadily increasing in India, employment in manufacturing sector will steadily continue to increase.

-ves:
- India will see less of international products.
- Less of foreign investments due to fear of less plant utilization in case of market or product failure. Currently companies such as Fiat utilize their plants for exports.
- Less competition from international brands = Possibly poor products from Indian manufacturers.

How it affects the developed nations?

- They have to depend on other low cost nations for imports to fulfill their local demands. So, as long as they are able to find sources for that, it is India which will suffer with less competition and associated losses.

It is a vicious cycle! Be competitive or be dictated..

[ashokabs]

This has been a problem with Korean companies. They have a very different culture and expect Indians to align with that. However, they tend to also look down on Indians and this is usually evident from their behaviour. I have dealt extensively with a Korean company for almost a year. Another friend was Dy MD of a large Korean company in India but was treated like a peon by the Chairman and other senior Koreans. He left, if I remember right, within a year of joining.

Originally Posted by itwasntme

Good time to keep in mind that Hyundai's global management has always felt deeply 'betrayed' by the endemic and relatively viokent labour troubles at their Chennai plant. Due to multiple reasons (another topic altogether!), they have never been able to hit the 'sweet spot' in their IR.

Googling for 2 minutes will find multiple hits on Hyundai's threats to move out production from Chennai. See a few examples below:
http://www.just-auto.com/news/labour...0_id99260.aspx
http://www.domain-b.com/companies/co...ion_india.html
http://www.siasat.com/english/news/h...aunches-strike
http://ibnlive.in.com/news/workers-t.../207019-7.html

Some of it is no doubt 'posturing' to pressurise the unions, labour commissioners, politicans etc. However, from what I can glean from media reports, they always had plans to move the European i20 to EU-based factories. Today's news is simply execution of that conscious strategy!

[romeomidhun]

I think this is a step from Hyundai to reduce the cost. They don't need to produce same model car of different quality (one for India, one for Europe).

[jalsa777]

Originally Posted by harpreetkanwar

I for one hope this pressurizes the government to look into FTA's. And why shouldn't the EU hike the duty on cars coming from India in this era of Global Free Trade, when India can't reciprocate the same. A lot of people are moving up to luxury cars and those who have driven them, are saving up for the uber-luxurious ones, the ones that can't necessarily be brought in via the CKD route, owing to the more than double price tag they carry.

Also, the "indian focused cars funda" is just a shame when at the same time we are talking about NCAP like safety programs being implemented in India, if at all this move by Hyundai is a signal towards India's unwillingness to sign the FTA for automobiles.

The argument that Indian manufactures would suffer with the FTA's is simply wrong, it would just make already "cheaply built" cars even cheaper when it comes to Safety, comfort and quality.

I bed to disagree. The reason the automotive sector is the highlight of the Indian manufacturing sector (along with pharmaceuticals) is that the duty structure ensured that local manufacturing was competitive and protected while being loose enough for components to be imported at reasonable prices. This is the only reason why manufacturers want to open plants here in India. New technology can be brought in using the components route and eventually, there is always a business case for local sourcing of components.

Without such a duty structure, the whole Auto manufacturing sector would not have picked up like it has. India needs to take advantage of its large domestic market and promote manufacturing as a means of employment creation and income generation. FTAs are no good for this.

As regards to this policy restricting the use of new technologies:
This is because cars with lower safety features are allowed to be sold. If safety regulations are made tighter, manufacturers will comply. They cannot afford to leave such a large market. Thus, make it compulsory to have airbags and ABS and the like, and you will have cars with them. In fact, it will also help exports if some arguments about why Hyundai stopped exporting to EU from India made earlier in this thread hold true.

[shankar.balan]

Originally Posted by harpreetkanwar

Also, the "indian focused cars funda" is just a shame when at the same time we are talking about NCAP like safety programs being implemented in India, if at all this move by Hyundai is a signal towards India's unwillingness to sign the FTA for automobiles.

The argument that Indian manufactures would suffer with the FTA's is simply wrong, it would just make already "cheaply built" cars even cheaper when it comes to Safety, comfort and quality.

I hate this Made for India concept in cars. Especially when the world is moving in a certain direction as regards safety and features, we seem to be regressing into cosmetic upgrades, god damned "beige interiors", completely useless daytime running lights which make one look a fool in a hot, sunny country and tagging on a "boot" where none was before, just to feed the neighbour's envy that one has a blasted "sedan"!
At this rate, we will end up like the bad old days in Eastern Europe where their cars were a joke!