[sh3lby]

Originally Posted by padmrajravi

Hyundai sold 150 odd Tucson in February. Why would Toyota take all that pain to localize and bring Rav4 to sell 150 cars per month when they are able to sell 3400 Fortuners at 40-50L ? Isn't the investment better used there ? And Rav4 is pricier than Tucson in all markets. So there is no way they can price it lower than Tucson only in India. We are definitely facing some unfair treatment by not having Toyota global portfolio, but there is no business case for them to bring it in India.

I think the problem is that we Indians have been conditioned to paying more for less. I am aware that the govt's insane taxation laws play a major role in this, but the fact is that manufacturers (even Toyota with local manufacturing) bring cheap products to the table and sell it at a price it's not worth, to a people who are poorer compared to the rest of the world - at a price higher than the rest of the world.

[Earthroamer]

Originally Posted by sh3lby

I think the problem is that we Indians have been conditioned to paying more for less. I am aware that the govt's insane taxation laws play a major role in this, but the fact is that manufacturers (even Toyota with local manufacturing) bring cheap products to the table and sell it at a price it's not worth, to a people who are poorer compared to the rest of the world - at a price higher than the rest of the world.

Tha manufacturer is help less here. Are you aware of the sub 4 metre GST? A car with greater than 4 meter in length would attract 49% GST which is included in the ex showroom price itself( even if it is manufactured in here). Let's consider CBU of RAV 4 base model which is retailing at 30 lakhs in US. If it is imported here, with import duties and GST on it, it would be minimum 80 lakhs. It would defeat the entire purpose of RAV4. If someone buys RAV4 at 80 lakhs, he would still be complaining about "underwhelming" interiors just like they are all doing with fortuner.

[NetfreakBombay]

Originally Posted by sh3lby

manufacturers (even Toyota with local manufacturing) bring cheap products to the table and sell it at a price it's not worth, to a people who are poorer compared to the rest of the world - at a price higher than the rest of the world.

Not in their control.

Compare taxes (sales/GST) in India to USA.

USA : 0 to 7%. (NY 4% , NC 0% and so on https://www.policygenius.com/auto-in...rate-by-state/)

India : 33% (28% + 20% cess)

If a manufacturer decides to add side airbags worth 10k , cost increases by 13k (on road by 15k). So companies have to cur parts by 30% just to keep prices same as other countries.

[sh3lby]

Originally Posted by Earthroamer

Tha manufacturer is help less here. Are you aware of the sub 4 metre GST? A car with greater than 4 meter in length would attract 49% GST which is included in the ex showroom price itself( even if it is manufactured in here).

Originally Posted by sh3lby

I am aware that the govt's insane taxation laws play a major role in this

I am aware of the sub 4m rule and had argued against it in this recent thread here.https://www.team-bhp.com/forum/india...t-today-4.html (The Sub-4 Meter small car rule | Is it still relevant today?)

Originally Posted by Earthroamer

Let's consider CBU of RAV 4 base model which is retailing at 30 lakhs in US. If it is imported here, with import duties and GST on it, it would be minimum 80 lakhs.

Why should we consider CBU when Toyota India has a perfectly functioning local manufacturing plant? (although even then engine downsizing will be necessary, agreed).

Originally Posted by NetfreakBombay

Not in their control.

Compare taxes (sales/GST) in India to USA.

USA : 0 to 7%. (NY 4% , NC 0% and so on https://www.policygenius.com/auto-in...rate-by-state/)

India : 33% (28% + 20% cess)

If a manufacturer decides to add side airbags worth 10k , cost increases by 13k (on road by 15k). So companies have to cur parts by 30% just to keep prices same as other countries.

Originally Posted by sh3lby

I am aware that the govt's insane taxation laws play a major role in this

This doesn't stop other manufacturers from giving us better products. I know VAG India is not a good example in terms of how it is doing in the nation (maybe it deserves thread of its own in terms of what it could do in India with a proper strategy) but we have cars like the Tiguan, Octavia, Kodiaq being offered at reasonable prices, which are nicer. Albeit nicer does not mean better, I admit to the ruggedness and reliability of Toyota vehicles, but at 50-60 lakhs some basic expected things are missing...

[Earthroamer]

Why should we consider CBU when Toyota India has a perfectly functioning local manufacturing plant? (although even then engine downsizing will be necessary, agreed).


Toyota has assembly lines here, not manufacturing. Parts come here in CKD and gets assembled here. That's why prices are so high. If RAV4 comes out here in CKD, it would still be priced north of 60 lakhs for sure.



This doesn't stop other manufacturers from giving us better products. I know VAG India is not a good example in terms of how it is doing in the nation (maybe it deserves thread of its own in terms of what it could do in India with a proper strategy) but we have cars like the Tiguan, Octavia, Kodiaq being offered at reasonable prices, which are nicer. Albeit nicer does not mean better, I admit to the ruggedness and reliability of Toyota vehicles, but at 50-60 lakhs some basic expected things are missing...[/quote]


I'm sorry, I'm gonna have to disagree here. Tiguan, Octavia, kodiaq are not offered at reasonable prices here. I mean Octavia is gonna be at 40 lakhs. Unlike the Germans , which has fancy engineering mechanisms with more failures points, toyotas famed reliability comes from their approach to use only functional parts which are robust, which is always going to be underwhelming and priced lower than its competitors.

If a car reviewer reviewing a RAV4 in US, which he got for 32k USD, he would be satisfied with it. But implement our Indian taxes on it and make it 80k USD, which is defender pricing in US, he certainly would be lambasting the toyota. Which is what this entire thread is about. The market is not satisfied with the price of the fortuner. If RAV4 comes here, you would still not be happy about the model and it's pricing.

Indian market is also very underwhelmed with entry models of big 3 Germans for the same reason and suggest people to get either a skoda superb or go for higher variants. Take a look at reviews of BMW X1 with 1.5litre turbo petrol , which retails at 63 lakhs. It's not the fault of the manufacturer but the taxation system.

[guptad42]

Originally Posted by ferrarirules

Finally, they should look at competitively pricing their cars in non-niche segments. Toyota Hyryder Strong Hybrid top model ex showroom Rs 20.19 lakh vs Hyundai Creta Diesel top model ex showroom Rs 20.15 lakh. Creta comes with a full suit ADAS, much better interior and larger boot.

This is the crux of the problem with hybrids in India. The pricing is insane and not tuned for 'India scale' high volume possibilities. Partly tax, but also because Toyota's hybrid system is complex and expensive. They have tried making a cheaper hybrid system and failed. The premium over similarly taxed ICE vehicles is just too much.

Better diesel models are often at the same price or cheaper, like the Creta diesel top model you pointed out.

Not just that, even decent spec EVs are now in the ballpark. MG ZS EV now starts at 20.13L on-road Mumbai. It's actually under 20L if you take insurance from outside. Very comparable in size, faster performance, even cheaper than the hybrids to run. Here's a link to quick comparison (on carwale) between ZSEV, Hyryder and Grand Vitara models around 20-21Lacs.

GST reduction on hybrids may help, but if govt has to be believe Toyota's promise of hybrids as an aid to transition to EVs, then the hybrid specs for GST law can be designed to promote such a transition. For GST benefit, hybrids can be specified to be:
1. PHEV: Plug-in hybrids only. Get people used to charging overnight, expand the number of home chargers. 3KW AC chargers are fine for smaller batteries in hybrid cars.
2. Min EV-mode range of 50km, so that common daily commute distance can be covered in EV mode for most people. The range extending petrol or CNG engine helps remove range anxiety for longer distance trips. People get used to the low cost of EV per km. Maruti's proposed series hybrids will be better for this that Toyota's complex and expensive hybrid system, if Maruti sizes the batteries well and provides plug-in charging.
3. Notify a timetable for gradually raising min EV-mode range to qualify for GST benefits. Gradually increase to 75km, 100km, and then 150km by 2030. The hybrids will slowly give way to EVs, which is the story Toyota is officially selling anyway.
4. Since hybrids still use fuel, we can also retain a small tax advantage for EVs. PHEVs can be 12 or 18% GST while EVs are 5%. 12 or 18% is still a massive reduction from 43%

For typical commuting duties, hybrids will become irrelevant faster than this 2030 timeline in India. In about 2 years with the new EV policy, there will be several choices of affordable EVs in India. The Chinese have the best EV tech and they are desperate to find a way to access the Indian market, via JVs like MG-JSW or via Indian free trade agreements with third nations. BYD's Thailand plant is starting production this year.

By the way, in both scenarios - Hybrid or EV growth in next 2-3 years - one area that could see a major impact is resale prices of ICE cars in the same segment and a segment above. The used car demand may start collapsing. Buying a car now in this transition period is likely to lose us far more money on depreciation that we expect based on today's resale values.

[sh3lby]

Originally Posted by Earthroamer

Toyota has assembly lines here, not manufacturing. Parts come here in CKD and gets assembled here. That's why prices are so high. If RAV4 comes out here in CKD, it would still be priced north of 60 lakhs for sure.

I'm not sure you're right here. As far as I'm aware, Toyota Kirloskar Motors manufactures (it has 3 plants according to google) in India, and only cars like the Camry are CKD units.
And my point is not about bringing cars like the RAV4 directly from the US as CKD. Their flagship offering in India shouldn't be the ill-equipped Fortuner. Suppose the RAV4 is built here, it can be offered at 50-60 Lacs on the road, similar to what the Fortuner is sold at right now. I'm sure you don't think that the Fortuner is actually worth 50 lacs? And that the price of the SUV is inflated as of 2024?

I'm sorry, I'm gonna have to disagree here. Tiguan, Octavia, kodiaq are not offered at reasonable prices here. I mean Octavia is gonna be at 40 lakhs. Unlike the Germans , which has fancy engineering mechanisms with more failures points, toyotas famed reliability comes from their approach to use only functional parts which are robust, which is always going to be underwhelming and priced lower than its competitors.

Perhaps the German offerings are not reasonable. But in that way any brand can simply use 'functional parts that are robust' and claim superior reliability. Toyota's reliability fame is because they can offer competitive technology (proven perhaps, but not years outdated) and still be a mechanically better product than other cars on the market. Which again, isn't true for the Fortuner.

If a car reviewer reviewing a RAV4 in US, which he got for 32k USD, he would be satisfied with it. But implement our Indian taxes on it and make it 80k USD, which is defender pricing in US, he certainly would be lambasting the toyota. Which is what this entire thread is about. The market is not satisfied with the price of the fortuner. If RAV4 comes here, you would still not be happy about the model and it's pricing.

I think you've missed the point of the thread then. The point was never to compare the Indian market with the American market - I clarified that in the first line of the post itself. Obviously when I talk about the RAV4 I don't mean bring it into India as a CKD/CBU and worth 80k (66.6 lakhs conversion). And of course if you add Indian taxes and Indianize it, you will have to compare it to the Indian Land Rover Defender(1.3 Cr-156k USD) right ? Things begin making more sense in relative terms...

Indian market is also very underwhelmed with entry models of big 3 Germans for the same reason and suggest people to get either a skoda superb or go for higher variants. Take a look at reviews of BMW X1 with 1.5litre turbo petrol , which retails at 63 lakhs.

Agreed, the X1 is hopelessly underwhelming and the GLA isn't great either - but

It's not the fault of the manufacturer but the taxation system.

is absolutely not true. That is just BMW being disrespectful to the Indian market. What changed in the govt norms that they went from offering a 180 HP engine to a 135 HP, 3 cylinder? While at the same time Audi can offer me a 190 HP quattro Q3 ? BMW is absolutely at fault here and Mercedes is as well (price gauging).
All this aside I'm glad we're able to debate on this.

[SideView]

Originally Posted by sh3lby

Maybe I shouldn't have titled this as 'complacency' and more as an opinion on their Indian portfolio, but I think this is worth a discussion.

We only have ourselves to blame for toyota’s complacency. If we do not buy “overpriced” car manufacturer will surely do a jimny. Even with these ridiculous pricing people are making a beeline that too with ridiculous waiting periods, so there is no reason to manufacture to reduce anything.

As demand increases compared to production any company will try to squeeze maximum profit (afterall they are no charity)

Trust me if there is 6 months (could be even less) of low sales there will be a price correction.

[Cavityavenger]

The Hilux is right now being offered at a 10-12 lac discount. A more fair pricing for the fortuner should also be at least 10L below it's current price.