[Comrade]

May be some concession can be given based on the total volume imported by the manufacturer in a month or an year. Maybe something like below will only benefit few marginal segments like luxury cars or top-end EVs or pickup trucks or SUVs etc. I think it should still safeguard 10-50L car manufacturing in India, which is where probably all the volumes come from.

0-1000 cars per month = 10% import duty
1000-3000 cars per month = 40% import duty
3000+ cars per month = 100% import duty

I am not aware of all the details but most importantly, wouldn't suppliers to Indian manufacturing lose big time? Wouldn't supply contracts start going to Chinese, Thai, EU and US suppliers to import parts and assemblies into India? I think import duty on parts & assemblies should continue as-is regardless of the pressure from these nations!

[autoliebe]

Originally Posted by carjack3090

You have chosen a terrible example because both Vietnam and China have extremely high restrictions on how a Foreign OEM can operate and sell in their country.

I am sorry, as I may not have provided the context properly.

What I meant here was that tarrifs were fine until home industries could catch-up with their wester counterparts; but in our case, these companies only made money and never developed themselves to make world class technologically advanced products themselves. Till date they take tech from west and now China to make vehicles.

If we keep protecting them, they will never grow up to the competition. It’s high time that we remove tariffs and give them a level playing field to compete.

Ultimately it benefits nation.

In both China and Vietnam’s case, BYD and Vinfast emerged due to tariffs implemented by respective countries - but then there’s a timeline. You cannot protect home grown companies till the eternity.

I hope I could make myself better understood this time.

Thanks,

[carjack3090]

One big reason to avoid FTA is this above, European firms are under lot of duress and would need us way more than we need them. Volkswagen for starters may actually look to shift base to India for bigger manufacturing plans

On the other hand if everything works well then our Indian carmakers will have an opportunity to go shopping in next 2-3 years. Then one can get Jeep owned by a Mahindra, SEAT owned by Tata and so on

[SmartCat]

Depends on what India gets back in return! Because EU does not play nice either:

- Textile/footwear imports from India to EU is based on a "quota system". India is allocated a certain quantity, and so is Bangladesh, Pakistan and other developing countries.
- EU restricts IT services trade with India using regulations (Eg: data privacy & remote work regulations, limits on permits for Indian IT professionals etc)
- Environmental/food safety regulations (which is basically a non-tariff barrier)

[Noctis]

Originally Posted by SmartCat

- EU restricts IT services trade with India using regulations (Eg: data privacy & remote work regulations, limits on permits for Indian IT professionals etc)
- Environmental/food safety regulations (which is basically a non-tariff barrier)

Data privacy laws and food safety regulations are applicable for domestic players in EU as well and thereby provide a level field while serving a good cause.

Instead of trying to dilute them India should rather look into implementing some of these provisions and improving our own standards on these matters.

[siren373]

All for a reduction in import rates. The current import rates are abysmal and all this jingoism is only hurting us as consumers. We pay 90+ lakhs for an X5. If that's not ridiculous, don't know what is. Our industry despite severe protectionism still is terrible (look at Tata and Mahindra) and hasn't been able to build a single product that can compete globally.

We are happy when we get to grow our exports (Apple) but draw a face when the west asks for a fair trade in retun.

[carjack3090]

Originally Posted by siren373

All for a reduction in import rates. The current import rates are abysmal and all this jingoism is only hurting us as consumers. We pay 90+ lakhs for an X5. If that's not ridiculous, don't know what is. Our industry despite severe protectionism still is terrible (look at Tata and Mahindra) and hasn't been able to build a single product that can compete globally.

We are happy when we get to grow our exports (Apple) but draw a face when the west asks for a fair trade in retun.

Yes best, let BMW be the sufferer not you. No one is stopping BMW by making X5 in India with Indian parts and bringing prices down by 20-30 percent. Plus we cannot expect fair deal because we are a poorer nation with poor people that need employment, compared to riche rich of Europe who can afford to pay 3-5X of average Indian.

Don't bow down to bully tactics of EU and let them fall to place as they have with China

Second part of your question- Tata and Mahindra till very recent were marginal players with severed margins. One flop Nano and Xylo put them back a decade. For them to become globally out competitive they first need money. Volkswagen can afford to flop 100s of times due to their scale but for now alike Indian economy, Indian carmakers need to be nurtured. Thankfully it isn't far before they reach the top, 2-3 years more at maximum with their Market cap crossing 50 Billion USD

[siren373]

Originally Posted by carjack3090

Yes best, let BMW be the sufferer not you. No one is stopping BMW by making X5 in India with Indian parts and bringing prices down by 20-30 percent. Plus we cannot expect fair deal because we are a poorer nation with poor people that need employment, compared to riche rich of Europe who can afford to pay 3-5X of average Indian.

Don't bow down to bully tactics of EU and let them fall to place as they have with China

BMW isn't too keen on building locally because:

1) We are a poor nation that can't move 50k luxury vehicles annually. That's not worth investing 2 billion for
2) We don't have robust trade agreements like SEA on exports. I'd rather setup a factory there and export to other markets
3) Red tape and bureaucracy in setting anything manufacturing

To build a market for luxury vehicles, the import duty needs to go down to build a sizeable market domestically that then allows for companies to have a solid business case for manufacturing domestically

[carjack3090]

Originally Posted by siren373

BMW isn't too keen on building locally because:

1) We are a poor nation that can't move 50k luxury vehicles annually. That's not worth investing 2 billion for
2) We don't have robust trade agreements like SEA on exports. I'd rather setup a factory there and export to other markets
3) Red tape and bureaucracy in setting anything manufacturing

To build a market for luxury vehicles, the import duty needs to go down to build a sizeable market domestically that then allows for companies to have a solid business case for manufacturing domestically

If they have so many issues then don't do business here, don't even try to sell here from Europe- be happy with what is. As consumers too we should let BMW be, wait 2-3 years as Indian OEM's launch their BEV's with International standard of production.

See EU needs us more than we need them, thanks to us not budging in 2010s to EU, Aprilia is now manufacturing in Baramati to sell internationally. What if we had let Aprilia come here on discount? considering we were the largest 2W market

[siren373]

Originally Posted by carjack3090

If they have so many issues then don't do business here, don't even try to sell here from Europe- be happy with what is. As consumers too we should let BMW be, wait 2-3 years as Indian OEM's launch their BEV's with International standard of production.

See EU needs us more than we need them, thanks to us not budging in 2010s to EU, Aprilia is now manufacturing in Baramati to sell internationally. What if we had let Aprilia come here on discount? considering we were the largest 2W market

No, thanks. I'd very much like global products. Sorry but the same thinking got us where we were in 1991. Sub standard products, sky high prices, and no access to global innovation. It's not just cars, it is also a lot of other products. Aspirational brands, perfumes, electronics like gaming consoles. We pay a premium on everything thanks to crazy taxes.

Indian consumers have way more to lose than EU in this game and I for one support globalization. Protectionism can also be done by subsidizing local brands rather than tariffing the hell out of global products.

Also on Aprila, great but I'd rather not have to wait 1/10th of my life for good things to be available in my market.

[carjack3090]

Originally Posted by siren373

No, thanks. I'd very much like global products. Sorry but the same thinking got us where we were in 1991. Sub standard products, sky high prices, and no access to global innovation. It's not just cars, it is also a lot of other products. Aspirational brands, perfumes, electronics like gaming consoles. We pay a premium on everything thanks to crazy taxes.

Indian consumers have way more to lose than EU in this game and I for one support globalization. Protectionism can also be done by subsidizing local brands rather than tariffing the hell out of global products.

Also on Aprila, great but I'd rather not have to wait 1/10th of my life for good things to be available in my market.

This isn't about protectionism, use Indian suppliers, Indian workforce, Indian factories to make car for India and you will get a fair deal. For starters the top 2 in India for the longest time was a Japanese and Korean, not an Indian but that was right.

There is a huge difference giving access to International dumping versus letting open our market for International access.

Skoda a European carmaker made a very able Kylaq for India and that right there is fair competition for Europeans

[carjack3090]

Originally Posted by autoliebe

I am sorry, as I may not have provided the context properly.

What I meant here was that tarrifs were fine until home industries could catch-up with their wester counterparts; but in our case, these companies only made money and never developed themselves to make world class technologically advanced products themselves.

I hope I could make myself better understood this time.

Thanks,

People don't get it but our guys aren't that rich as let's say a 100 year old car brand like Toyota, Volkswagen or Ford. This means they have to be careful about investments

BYD is a bad example as looking into their history one can see it was a Private company that acquired a government car brand and one knows how it works in China, so one can essentially call BYD a government brand with high levels of support

Compared to that Indian carmakers were always on backfoot with changing Indian market scape and laws. Suddenly in 2017 they got to know Bs6 will get implemented in 2020, similarly they were told that they need to invest in EVs as Indian Government was looking to incentivize on EVs

One flop car, one bad decision wrecks havoc for Indian car makers. Tata had invested 600 crore into Nano and made less than 1/10th on it. That itself pushed Tata back by a decade. How can one expect them to do R and D work with such tough macro environment.

Now the companies have grown larger and got stability so they are looking to expand.

[Sohail_91]

Originally Posted by carjack3090

Yes best, let BMW be the sufferer not you. No one is stopping BMW by making X5 in India with Indian parts and bringing prices down by 20-30 percent.

The BMW X5 is a CKD (Completely Knocked Down) unit that is assembled in India.

Originally Posted by siren373

BMW isn't too keen on building locally because:

1) We are a poor nation that can't move 50k luxury vehicles annually. That's not worth investing 2 billion for
2) We don't have robust trade agreements like SEA on exports. I'd rather setup a factory there and export to other markets
3) Red tape and bureaucracy in setting anything manufacturing

Another key challenge in India’s automotive manufacturing landscape is the lack of auto component suppliers who can maintain global standards of quality while staying cost-effective. This supply chain gap is a significant hurdle for manufacturers who want to localize production.
JLR recently put a hold on its plans to manufacture EVs at its upcoming plant in Tamil Nadu, and one of the reasons behind this decision was "According to media reports, JLR was unable to find the right price-quality balance for locally sourced EV parts." - Source

Originally Posted by carjack3090

This isn't about protectionism, use Indian suppliers, Indian workforce, Indian factories to make car for India and you will get a fair deal.

As mentioned above, the limited capability of Indian suppliers to meet the quality and cost standards required at the premium end of the market remains a major challenge.

Establishing a complete supply chain from the ground up would be both time-consuming and capital-intensive. Moreover, with the majority of car purchases in India falling under the ₹50 lakh bracket, it’s uncertain whether luxury carmakers would be keen to invest heavily, especially in the midst of a global economic slowdown and ongoing tariff tensions.

I genuinely hope the day comes when we see a fully India-made BMW or Mercedes and not just a CKD build, but until then, a reduction in import duties would go a long way in making luxury cars more accessible.
After all, we are all mortals with limited time on this Earth, might as well drive what we love while we can, without having to pay double the value of the car in the form of import duties, we are already subjected to exorbitant road taxes for pothole-ridden roads, and ever-increasing toll charges.

[carjack3090]

Originally Posted by Sohail_91

The BMW X5 is a CKD (Completely Knocked Down) unit that is assembled in India.



Another key challenge in India’s automotive manufacturing landscape is the lack of auto component suppliers who can maintain global standards of quality while staying cost-effective. This supply chain gap is a significant hurdle for manufacturers who want to localize production.
JLR recently put a hold on its plans to manufacture EVs at its upcoming plant in Tamil Nadu, and one of the reasons behind this decision was "According to media reports, JLR was unable to find the right price-quality balance for locally sourced EV parts." - Source



As mentioned above, the limited capability of Indian suppliers to meet the quality and cost standards required at the premium end of the market remains a major challenge.

Establishing a complete supply chain from the ground up would be both time-consuming and capital-intensive. Moreover, with the majority of car purchases in India falling under the ₹50 lakh bracket, it’s uncertain whether luxury carmakers would be

My point is if BMW wants to make in Germany and sell in India then they cannot be incentivised in same way as someone who makes in India and sells in India does.

This is just lazy tactics. We should buckle up act like a bigger economy and just reject the deal. It is just 2-3 more years before they will themselves want to move to India for manufacturing considering how high the operation cost is in Germany. The issue though is they can manufacture in China but want to play dual follie in India.

As consumers too we must be way more self respecting and ask likes of BMW on why they haven't made attempts to manufacture in India

[akhil_007]

I have been reading online articles and responses on TBHP and everywhere the chorus is that India will be spared or will be neutral or will be least tariff imposed nation. Unlike other countries who can retaliate/talk from a position of power, what exactly is our trump card?

-Why would US or EU or any other country be OK with India imposing crazy tariffs on
imports? Its not like we are "smooth talkers" or the "best negotiators" in the world.