[GTO]

As we've seen innumerable times before on the forum, if you own a high-end luxury car, you are officially part of the rip-off club.

Honestly, does this look like damage that'll cost a whopping 15 lakh rupees to repair? Or 6 months to come back home? This car has an IDV of 23 lakhs; shockingly, the dealer once said it'll cost 19 lakhs to repair! In this accident, even the airbags hadn't activated.



Soumya Nambiar's sad tale is shared below. Summary:

Our car (Mercedes E250) met with an accident on 1st July 2016 and the initial estimate given to us was Rs. 15.85 lakhs to repair the car . On 29th September 2016, another estimate was given raising the total repair cost to Rs. 18 lakhs. This exceeded 75% of the IDV (insured declared value) of the car,which as per policy could be written off as total loss. We refused and agreed to pay anything over Rs. 15 lakhs from our pockets.

Final bill: Rs. 14.55 lakhs. Insurance Paid: Rs. 13.73 Lakhs and we paid Rs. 80,000. Date of Delivery of car: 10th January 2017 after fighting for more than 6 months.

Chronology of events:

• Achan (Our dad) was driving back to Bangalore from Calicut on 1st July 2016 in the Mercedes E250 with his colleague. 70 kms from Mysore, around 8PM, car met with a minor accident after hitting a stone. The reason why I say it was a minor accident was because both the occupants did not have a single scratch on them, none of the Air bags deployed and the active bonnet system did not get activated. Active bonnet is a feature in all Merc cars where in the event of the front bumper hitting anything, the bonnet is raised. This is done to prevent a pedestrian from hitting the windshield in the event of an accident. Car was towed to a nearby garage in Mysore.

• 2nd July 2016: Car was towed from Mysore to the dealer’s service center (Akshaya Motors) in Bangalore.

• 4th July 2016: A bill of around Rs. 15,85,000/- was sent to us. We decided to go for insurance.

• All requested documents were sent to Akshaya motors by 19th July. This went through multiple iterations. All documents were sent to insurance within the next few days.

• One guy from SBI insurance (or third party) came to get a signed affidavit from us on the nature of the accident during last week of July. He said this was for police verification purposes and he assured us that the claim will be processed soon.

• From August 1st 2016 to September 28th 2016: We sent multiple reminders asking about the status of the car. Every time we got a reply saying that it was pending with insurance for approval. We also had multiple phone conversations with both the insurance and dealer.

• 29th September 2016: Additional bill of Rs. 2,08,000 was sent to us. This made the total bill amount to around Rs. 18 lakhs. Our IDV (Insured declared value) was around Rs. 23 lakhs. The total bill came to more than 75% of our IDV and hence insurance was not liable to repair the car. They could declare the car as total loss. In such a scenario, the car will be bought from us at the IDV rate and then sold to 3rd party garages for salvage value. All this was speculation at that time since this was not told officially to us by either the insurance or the dealer when this bill was sent.

• 5th October 2016: We got oral approval from insurance to dismantle the vehicle. Achan told them that his only condition will be that he has to be present during dismantling. Complete radio silence from both the insurance and the dealer for the next one week.

• 12th October: After a threatening mail of going to consumer court from our side, Akshaya sent a mail saying that they are expecting an additional Rs.1.5 lakhs bill in addition to the billed amount, bringing the total to Rs. 19.5 lakhs. We also get a phone call from SBI general insurance saying that they are going to declare our car as total loss. We tell them that we refuse this and ask them to send a written communication and that the decision can be made only after dismantling the car. We also tell them that we will allow dismantling only if a technical member from Mercedes Benz India is present. Mercedes Benz India refuses our ask at this point.

• 25th October: Our first social media post went live. Mercedes Benz India agrees to send someone for the technical inspection.

• 27th October: All the concerned parties went to Akshaya motors (us, Mercedes Benz India representative and SBI general insurance representative) for technical inspection and negotiations. Insurance tells us that their final offer to us is Rs. 15 lakhs or total loss. If we wanted the car, anything that comes above Rs. 15 Lakhs will have to be borne by us. We walk out of there after an argument. Written communication of the offer of Rs. 15 lakhs or total loss is sent to us by SBI general insurance.

• 28th October: Akshaya motors sent us a threatening mail to make a decision or they will charge Rs. 500 per day for parking charges. We reply saying that we accept the offer of Rs. 15 Lakhs under protest. We agree to pay the remaining amount from our pockets.

• 2nd November: Dismantling of the car is done by Akshaya motors in the presence of us and the surveyor from SBI General insurance. Some parts which were not part of the previous bill are added, around Rs. 97,000. We are also told that many of the estimated parts do not require to be changed. But when we asked them to prepare the new bill, reducing the cost of all these parts, it is not given to us.

• 4th November: Parts are ordered and we get a confirmation from Akshaya Motors.

• 17th November: All parts arrive and work on the car starts.

• 30th November: We get oral confirmation from Akshaya motors saying that the total bill is around Rs. 14.5 lakhs which is well within the Rs. 15 lakhs offered to us by SBI General insurance. Please note that the estimate on 29th September was around Rs. 18 lakhs. We are also told that we have to pay Rs. 22,000 for the battery which is not covered under insurance. We agree to pay.

• 8th December: We get confirmation from Akshaya motors that the car is ready and the inspection has also been completed by insurance.

• 9th December: We send a reminder and insurance replies saying that the car will be released by 17th of December after approval from head office. Since the amount was huge, it had to go to head office for approval.

• 17th December - 2nd Jan 2017: We send multiple reminders but receive no reply from insurance.

• 31st December 2016: Insurance staff in charge of our claim quits the organization.

• 3rd January 2017: We receive a mail from the new insurance staff saying that they have approved a bill of Rs. 13.06 lakhs. We ask why there is a difference. We are told that ours was a depreciation policy and not a consumables receivables policy. In this scenario, wear and tear parts are not covered. We point out that 3 of the parts (Rs 67,000) are not wear and tear parts. They send the claim back to head office for approval. We agree to pay the remaining amount including Rs 22,000 for battery.

• 10th January 2017: We receive oral communication in the morning saying that approval has come for the remaining 3 parts. Achan goes to Akshaya motors around 12 PM and refuses to leave till the car is released. Akshaya motors say that their hands are tied since they cannot do anything until written approval comes. Achan is adamant and refuses to leave. Our calls and emails to SBI general insurance are not answered throughout the day. Finally around 3:45 PM, written approval comes. We pay the balance amount of Rs. 82,000. I reach Akshaya Benz around 5:15 PM and they are still cleaning the car. Finally, around 6 PM, after an extensive drama show by Akshaya motors, we take the car home. Why do I call it a drama? It is the first time I am seeing where a pooja is conducted for an old car. Apparently according to them, this is common in the case of big accidents. In addition to the Pooja, they present Achan with a box of chocolates, a big car key and a Ponnada (This is a cloth usually wrapped around people if we want to show their respect).

[GTO]

Estimate:






Final Bill:

[soumna]

Thank you to the moderators for adding me to the group.

I am posting this on behalf of my dad, Mr Narayanan Nambiar since he is not a member of this group.

"There are one or two comments that the accident is not minor and the stone might have ripped up the under body of the car.

This is not true.

If the car had hit the stone at reasonably good speed, the several safety features of the car would have got activated. (Unless they have supplied a car without the much advertised safety features). The most important of these are the active bonnet and airbags. They even talk about some safety features which get activated even without hitting any objects. These are activated if you apply the breaks at good speed.

We had inspected the car at the dealers premises along with the assessor appointed by SBI insurance,the service manager of Akshaya motors and the technical head of Benz India. A technical person who had earlier worked with one of the Benz dealers was also with us. We have taken photos of all the parts damaged before and after dismantling. The damage was only to the front bumper,lights, radiator and air conditioning. As anyone can notice from the bill these were not fully replaced only some of the parts changed.

I have done a detailed analysis of the bill as follows.

Total bill Rs. 14,35,000

Consumable parts paid by us Rs. 62,000 (excluding cost of battery)

Amount paid by SBI insurance Rs. 13,73,000

Labour charges 148,000

Parts cost Rs. 12,85,000

The list is very long with 71 items. However out of this 17 parts account for more than 80% of the value. These are listed below. The remaining 20% is mostly for various types of oil, coolant, hose, mounting etc.

1. Screw (4 nos) Rs. 12,000

2. Inter cooler Rs. 62,000

3. Condenser Rs. 65,000

4. Water cooler Rs. 39,000

5. Blower Rs. 63,000

6. Day time running light Rs. 26,000

7. Under body protector Rs. 27,000

8. Air hose Rs. 20,000

9. Sender Unit Rs. 54,000

10. Licence plate Rs. 9,000

11. Head lamp Rs. 170,000

12. Head lamp Rs. 170,000

13. Radiator Grill Rs. 70,000

14. Panelling Rs. 79,000

15. Integral Carrie Rs. 125,000

16. Belt pully Rs. 27,000

17. Coolant pump Rs. 26,000

Total cost of these 17 parts Rs. 10,44,000.

As anyone can notice they have divided each item into different parts and is charging exorbitant prices for each.

I have checked the prices of these parts online and found that it is costing far less outside India. However they dont give us any option to buy the parts and get it repaired.

We decided to bring this issue to the attention of public due to two major reasons.

A) Pricing by Mercede Benz which is a real rip off. Even for regular service we notice that they charge exorbitantly for oil, break pads, labour etc.

- Can forums like Team BHP and online community do anything to reduce this exploitation?

B) There was a clear attempt to make the car a total loss and take it away from us. The first estimate was less than 75% of the IDV and there was no way they could declare the car as total loss. At the time of giving this estimate the dealer had made it clear that the actual bill may be higher or lower than this and they can determine the actual only after dismantling the damaged area. However there was a collusion between insurance company and the dealer with the simple aim of taking the car from us and therefore they issued a second estimate (before dismantling) which made the total cost of repair 76% of the IDV.

- this type of collusion between the insurance company and motor vehicle dealers are very common and they have succeeded in making several cars total loss. We have gathered evidence to show that some of these cars which were declared total loss were taken from the owners and sold privately and the buyers have repaired the same at much lower cost and are running on our roads for several years.

- They will not allow us owners to buy the damaged cars. They will demand a large amount for storing the car in the dealers premises for 3 to 6 months and this cost makes it impossible for the owners to take the car out and repair on their own. This explains why they took several months to investigate and approve the claim. It is a deliberate attempt to demoralise us and increase the storage costs.

If the public is aware of this when you face a similar situation you may be able to act in a informed manner.

"

Also to answer some of the other queries,

1) Akshaya Motors is part of Advaith Motors and is the licensed dealer to sell Mercedes Benz Cars in Bangalore.
2) I have no idea what M & R stand for. But the ones marked by crosses are the ones disapproved by insurance saying that they are consumables and was not covered by insurance as accidental damage.
3) The battery was not damaged in the accident and hence was not covered by insurance as accidental damage. I guess the battery just failed to work after sitting idle for more than 5 months.
4) The car completed 5 years in November 2016 and that is why the IDV was only around 23 Lakhs. We wanted to keep the car for sentimental reasons.
5) None of the parts that were replaced were given back to us.

[himanshugoswami]

Honestly.....after reading reports like this and numerous others, IMHO, the most pragmatic policy is to buy Indian or Japanese cars in India. You will lose out on the snob value of the Germans, and in a few cases, the performance/fun to drive element, but at least you wont get ripped off when (a) buying the car and (b) running and repairing it. Even resale on the whole is better than that of the Germans.

[landcruiser123]

Originally Posted by GTO

As we've seen innumerable times before on the forum, if you own a high-end luxury car, you are officially part of the rip-off club.

Luxury cars owners are not alone, we have stories with bikes too. Harley owners protesting regarding bad brakes(???), Kawasaki owners not getting bikes for months are a few I've read in the last couple of months.

Going by what the first few pictures indicate, this repair is nothing but a complete rip-off.

Our laws regarding consumer protection need to be tightened right now. Customers in our country have a more disposable income than ever before and we should protect consumers from being royally ripped off by these kind of rogues.

Also, monopoly of service centers should be stopped. Is there a way to do this?

If Lexus offer good hybrids and the same levels of customer satisfaction which Toyota does, their sales are going to improve like crazy.

[SmartCat]

Looks like the stone was quite large (stone height above the front bumper level) and it is likely to have ripped up the under-body of the car. That explains the multi-page parts list and Rs. 14 lacs bill for parts alone. Although the accident is minor (as in no injuries to the passenger), the damage to the car was quite severe.

[Axe77]

Is this for real? This actually sounds like a case of fraud to my non technical understanding. One in which the insurance provider and dealer may well be in collusion. Or am I reading too much into it?

I'm also surprised how escalation to Mercedes company level had such little value in a case like this. Any thoughts?

[aravind.anand]

I am a salaried car enthusiast and like many others, have always had a dream of owning one of these luxury cars at some point in my life. But just going through the parts catalog, I am flabbergasted that many of the spare parts from the bill are slightly more than what I make in a month

And, I really want to know what that compressor oil is actually composed of, it costs a cool INR 8725 for 250 ml, so it is a shade under INR 35,000 a litre

[gkveda]

My blood started boiling when I saw "They would declare this car as Total Loss" since repair cost is greater than 75% of IDV
Was wondering why IDV is so low for such a priced Car?
Also, wondering, if they declare a car in such a wonderful condition with minor dent on front bumper and related internal parts, as Total Loss, then, on lighter side, Actually, CAR is not Total Loss. But, the owner of the car is at Total Loss.

I think this is pure play between Insurance and Dealer. Like a Patient when admitted to hospital, first question that is asked by receptionist would be "Do you have insurance?"

If the answer is "Yes", then, the time starts to rip right from registration fee, admission fee, dressing fee, to every service that you get in hospital.

On lighter side, I am surprised, they have not included the Pooja Charges in the bill. It would have been "Normal" for them to charge some 1 or 2 Lakhs for giving life to a Total Loss car and performing the Pooja and other customs

Sometimes, I really feel sad for our(Read Customer or Common Man) situation in India. Is there no way of coming out of this situation?

[Sawyer]

Originally Posted by GTO

you are officially part of the rip-off club.

Honestly, does this look like damage that'll cost a whopping 15 lakh rupees to repair?

I took a quick look at the parts changed and noticed these three examples as some that stood out:
Headlamp unit pair: Rs 3.4 lakhs
Radiator grille: Rs 60,000
Number plate: Rs 10,000

That's more than 25% of the total bill just there.

No wonder at the total bill in that case, though the time doesn't look reasonable. On the cost, in India it is the story of not running these cars if these repairs/insurance cannot be afforded. Which is why even buying a used example can be an expensive thing in terms of running costs.

[VKumar]

Originally Posted by smartcat

Looks like the stone was quite large (stone height above the front bumper level) and it is likely to have ripped up the under-body of the car.

I went through that bill exactly 4 times, still half off it is went over my head. Finally, after spending my time in analyzing that what could have happened. I decided to take the easier path, I am in an agreement with this gentleman.

This bill looks like a sure shot rip off to me. Does this 'License plate M' thingy means the license plate? If yes, then, please get me a contract for supplying this item.

I am still unable to make out the need for headlamps replacement, hood repair and repaint, left front door repair and repaint etc. Or maybe I am unable to make out where the damage exactly is.

Freaks, I give up. The stone was really very big, I wish I never meet such a stone, left back by some trucker after getting his truck repaired on the right lane of the highway.

Oh yeah, scam alert; item no. 55 is 'disinfectant'. Don't know what all they have added.

[SmartCat]

Originally Posted by aravind.anand

And, I really want to know what that compressor oil is actually composed of, it costs a cool INR 8725 for 250 ml, so it is a shade under INR 35,000 a litre

Great analysis . ONGC should stop looking for shale oil or deep sea oil and start exploration of this "compressor oil".

In the parts list, I wonder what are X's, R's, M's and circles?

[Nissan1180]

What really bothers me is that there are very limited options for servicing or repairing high end cars in India. Looking at the bill, I could not help wondering how complex the bumper itself is. There are so many components related to the bumper. If the car had been handed over to a competent external mechanic, I'm sure he'd have managed to repair it at a fraction of the cost but I also think he'd have missed out on certain parts that are not aesthetically relevant.
Buying a Mercedes requires a lot of financial freedom. Even if I can afford the car, I don't think I'd like to pay so much for maintaining it.

[Durango Dude]

The Germans come with an entry and exit load and is something of an 'Airavat' to maintain. They literally take the Indian's for a "ride". What's a dream for many here is 'Oh so easy' to get abroad: my son's classmate went to the US some two years back and he is all of 26 years old and on his first job there his ride is a BMW 3 series: How many of us here can even think of doing that in our life time, let alone on our first job!

[androdev]

This is not a minor accident. The car went over stones at a reasonably good speed causing fair amount of underbody damage as can be inferred from the list of parts in the estimate. The workshop inspected the car and made a long list of parts to be replaced. In such cases, it is very hard to come up with a precise estimate and it is not unusual to get upward revisions. This is the standard procedure for any such accidents. I had a similar accident with my Skoda Laura, I opted to get cash settlement from the insurer instead of repairing because of this exact reason - it will result in multiple lengthy "dealer > insurance > owner" negation cycles coupled with parts availability issues and actual time taken to repair. If you negotiate harder, things will get delayed further.

Of course, this is not to say I agree with the bill amount or the poor quality experience. I am just saying this is not a minor accident used to cheat the customer. The workshops have this very clever system in place that generates a really long list of items each costing a couple of thousands but the total adding up to lakhs. They don't repair or reuse anything that is suspect, so you have no scope for negotiation and if you notice there is no single part that can be blamed for the large bill. It is a foolproof way to fleece the customer. On the contrary, a private garage just gives you a rough estimate and will try to reuse/repair most of the parts and also sources parts/labour at cheaper rates.

Things get ugly when repair cost is around IDV because the insurer wants to give you IDV and salvage the car to reduce his net payment. Especially certain accidents are very cheap to fix in a private garage where there is scope for repair/reuse of parts - there is scope for kickbacks.

How can you avoid such a situation? Mercedes offers "return to invoice" policy for up to 5 years. Yes, there is huge premium to pay, but they save you from experiences like these. I get the message though, the customer is fleeced one way or the other.

EDIT: It just occurred to me, fancy hospitals issue the same itemised bill after you had a surgery Long list of tiny expenses adding up to a big total. Not a coincidence!