Federation of Automobile Dealers Associations | fada.in | Estb: 1964 November 2020 | Vol. 20 | Issue: VIII | Pages : 60 | Rs. 50
fada 4, President’s Message
Journal The Worst Is Now Behind Us.
2021: A Year of Strength and Revival
Insights from the Automobile Retail Industry
8, India Economics
GDP Q2FY21 | RBI Policy at Status Quo |
Inflation & IIP: Base Turns Favourable |
IIP Got Support from Low Base
16, Demystifying GST
Applicability of Service Tax on Discounts /
Incentives in Automobile Sector and Facing
Enquiries / Investigation
33, Surveys & Studies 20, FADA in News
Electric Buses - India Market 30, Enterprise
Analysis
42, Perspective
AI in Automotives - The Future Why Less is More for Wow! Momo
is Now!
Sagar Daryani, CEO & Co-Founder of Wow! Momo Foods
Federation of Automobile
Dealers Associations (F A D A)
is the apex body of Automobile Retail Industry in
India.
F A D A has been representing over 15,000
automobile dealers having over 26,500 dealerships
including 16 associations of Automobile Dealers at
the Regional, State and City levels accounting for
90% of market share in India since 1964. Together,
we employ over ~5 million people in the country
(including Direct and Indirect employment) at
dealerships and service centres.
contents Federation of Automobile Dealers Associations | fada.in | Estb: 1964 November 2020 | Vol. 20 | Issue: VIII | Pages : 60 | Rs. 50
November 2020 | Vol. 20 | Issue: VIII fada 4, President’s Message
The Worst Is Now Behind Us.
4 President’s Message Journal 2021: A Year of Strength and Revival
The Worst Is Now Behind Us. 2021: A Year of Strength and Revival Insights from the Automobile Retail Industry 8, India Economics
GDP Q2FY21 | RBI Policy at Status Quo |
8 India Economics Inflation & IIP: Base Turns Favourable |
IIP Got Support from Low Base
GDP Q2FY21 | RBI Policy at Status Quo | Infla on & IIP: Base Turns Favourable |
IIP Got Support from Low Base 16, Demystifying GST
Applicability of Service Tax on Discounts /
10 Auto Retail Registration Incentives in Automobile Sector and Facing
Enquiries / Investigation
FADA Releases November’20 Vehicle Registra on Data
33, Surveys & Studies 19, FADA in News
14 FADA Research
Electric Buses - Indian Market 30, Enterprise
Passenger Vehicle Registra on in India - Trend Analysis Analysis
16 Demystifying GST 42, Perspective
Applicability of Service Tax on Discounts / Incen ves in Automobile Sector and Facing AI in Automotives - The Future Why Less is More for Wow! Momo
Enquiries / Inves ga on is Now!
Sagar Daryani, CEO & Co-Founder of Wow! Momo Foods
19 Govt Circular
Printed and Published by Saharsh Damani on behalf of Federa on of
20 FADA News Automobile Dealers Associa ons, 805, Surya Kiran, 19, K G Marg, New
Delhi-110 001.
- FADA Wins the Award for Industry Associa on of the Year at 2020 APAC Associa on Awards
- FADA State Chapters Ini ates Dialogue with State Machinery Printed at Sita Fine Arts P Ltd, A-16, Naraina Indl Area - II, New Delhi
- YES Bank Partners with Automobile Industry Ecosystem for ‘Truly Yours’ Week Celebra ons
- ASDC and FADA Join Hands with Google to Lead Industry’s Digital Transforma on Editor: Saharsh Damani
30 Enterprise Advertisers’ Index 59
45
Why Less is More for Wow! Momo Kuttukaran Group 29
Provincial Group 07
33 Surveys & Studies Shriram Transport Finance 60
United Group of Institutions
Elec c Buses: India Market Analysis Wings Infotech
39 Competition Law Updates
40 Technology Editor, F A D A Journal and CEO, F A D A
Blockchain in the Automo ve Industry: A Soon-to-be Mul billion Dollar Business Mr Saharsh Damani
T +91-11-6630 4852, 2332 0093, 2332 0095
42 Perspective E [email protected]
AI in Automo ves: The Future is Now! Of ice Bearers Vice President
Mr Manish Raj Singhania
46 Membership President E [email protected]
Mr Vinkesh Gulati
48 Automotive Insight E [email protected] Treasurer
Mr Sai Giridhar
Will Consumers Finally Be Able to Buy New Cars Online? Secretary E [email protected]
Mr C S Vigneshwar
53 Industry Track E [email protected]
November 2020: Auto Retails Strive To Stay On Course
56 Statistics
Vehicle Sales, Y-o-Y Growth & Market Share - November 2020
President’s Message
The Worst Is Now Behind Us.
2021: A Year of Strength and Revival
vinkesh Gulati, president - FADA Dear Friends,
4 F A D A Journal November 2020 | fada.in For the en re world, 2020 was truly a challenging and
disastrous year. As the Novel Coronavirus brought the global
economy to a grinding halt, the Indian Automobile Industry
was busy adap ng and overcoming some truly unprecedented
challenges.
We faced a tough transi on to the government’s BS-6 emission
norms. It was truly commendable how the Dealer Community
came together as one to get BS-4 vehicles registered before
the due date. This year is finally ge ng over and it is now me
to reflect and chart out our future course of ac on for the
upcoming year.
We, as an industry, approached the Supreme Court and due to
our commitment to our principles, we received a favourable
decision for the auto retail community. Our unity exemplifies
the spirit of “Many in body, but one in mind” and this thought
will spread as we get more of our dealer friends under the
FADA umbrella.
During November’20, respite came to dealers of Delhi as the
apex court permi ed the registra on of BS-4 vehicles whose
details had been uploaded onto ‘E-Vahan’ before April 1st,
whose taxes were paid, and registra on numbers were
generated. This has been possible due to the all out support we
got from the Ministry of Road Transport and Highways and for
this, I express my sincere thanks and deepest gra tude to
Hon’ble Minister Shri Ni n Gadkari Ji and Shri Priyank Bhar ,
the then Joint Secretary of MoRTH. FADA Delhi State
Chairperson - Ms Garima Misra also played a pivotal role in this
en re ma er.
Another respite which came was Udayam (MSME) Registra on
for Auto Dealers (NIC Code:45) being finally enabled through
the link: h ps://udyamregistra on.gov.in/Government-
India/Ministry-MSME-registra on.htm . Kindly register, if not
done already, as the Inclusion in MSME ambit would enable
you to avail the benefits like Loans without Collateral,
Eligibility for Industrial Promo on Subsidy, Protec on against
delayed payments and Lower fee for Credit ra ng to name a
few as per Government Policies.
I am also happy to share that your Federa on for the first me
won the award for INDUSTRY ASSOCIATION OF THE YEAR 2020
President’s Message
by Glue Up, the leading all-in-one engagement This is an accomplishment for the Retail Community and
management so ware company in its 4th Annual APAC on behalf of the auto retail fraternity, I express my deep
Associa on Awards due to its contribu on to the Auto and sincere thanks to Mr K Keshav Rao and Members of
Retail Industry in India. This would not have been possible the Parliamentary Commi ee. I hope that the
without your invaluable support and the unwavering Government accepts these recommenda ons and fosters
dedica on of the Secretariat led by Mr Saharsh Damani. the growth of the Auto Retail sector.
FADA for the 1st me invited Shri Ni n Gadkari ji, Hon’ble Reitera ng about FADA’s ac vi es, we con nued with
Minister of MoRTH & MSME on November 28, 2020 for a webinars on Service Tax on Discounts & Incen ves: two
virtual interac on with the Auto Dealers. It was a live such webinars had been organised for South and West
session and over 1,500 dealer friends had joined. During zone FADA members on December 11 and December 18,
my speech I had raised issues pertaining to 2020. I hope you all a ended the webinars conducted by
Implementa on of CMVR Act; Uniform Road Tax across Mr Puneet Bansal, Managing Partner of Nitya Tax
country & implementa on of NAPS under MSME. The Associates, and gained from the presenta on and
Hon'ble Minister gave a pa ent hearing and replied to all interac ons.
ques ons pa ently being asked by few of us. In his
interac on, Gadkari ji said that it is his mission to make Amongst the new ini a ves and to skill auto industry
registra on of vehicles both faceless & paperless. He also professionals in digital marke ng, FADA in partnership
made us aware regarding some of the ini a ves which his with Google & ASDC is conduc ng a unique and scaled
ministry was working upon: digi sa on ini a ve “Grow with Google”. In its ini al 3-
part series, the program is designed for DPs & their CEO's.
a) To roll out Two Wheelers as taxi with electronic meter At the conclusion, the par cipants who a ended all the 3
for making the last mile connec vity be er; parts of the program will be cer fied by Google, ASDC, and
FADA. This program will be followed with a series of video
b) Implementa on of Broad gauge Metro having speed sessions for the digital marke ng teams of the
of 160 km/hr; dealerships.
c) Technology centres being set-up in line with PM's Friends, FADA will be hois ng a virtual webinar on the
vision of Atma Nirbhav Bharat New Consumer Protec on Act on 9th January’20 to help us
all to understand the nuances of the new law and how we
He requested that Auto Retail Industry should ac vely must be prepared in terms of our rela on with our OEMs,
par cipate in some of these ini a ves and should also customers and other stakeholders in the value chain. The
support ac vi es for making roads safer in India. webinar shall be taken by Mr Anand Shankar Jha,
Advocate on Record, Supreme Court of India. He has
In November’19, under our Immediate Past President - conducted similar webinars for Mahindra Dealers in the
Mr Ashish Harsharaj Kale, FADA had made a presenta on past. Details about the same will the shared with all in
in person before the Parliamentary Standing Commi ee
for revival of growth in Auto Retail. I am happy to share mes to come.
that our key recommenda ons have been taken into
account and incorporated in their recently released To eradicate the menace created by Mul Brand Outlets
report under the Chairmanship of Mr K Keshav Rao. The especially in the 2W market segment, FADA wrote to all the
same were, Franchisee Protec on Act for Auto Dealers; State Transport Commissioners and Heads of Banking &
FDI in Auto Retail; Introduc on of One Na on – One Road Financial ins tu ons solici ng their help. MBO’s keep
Tax; Reduc on of GST by 10%; GST on Pre-owned vehicles unregistered vehicles of different OEMs, for which they do
to be reduced from present 12% & 18% to flat 4%; making not hold any trade cer ficate and are also not en tled
effec ve rate of deprecia on as 25% on permanent basis; under CMVR for issuance of such a cer ficate and hence are
and DHI in collabora on of other Ministries to workout not bonafide dealers either. Keeping and selling
measures to ensure disposal of surplus BS-4 stocks & unregistered vehicles without TC is both unethical and
filing of a review pe on in Hon’ble SC for the disposal of illegal and puts both the customers and Banking/Financial
such vehicles. ins tu ons at huge risk due to their fraudulent ac vi es.
FADA State Councils are also working with State Transport
fada.in | November 2020 F A D A Journal 5
President’s Message
department towards this. Tamil Nadu & Maharashtra State the process of registra on of new vehicle is complete by
Councils have been successful in ge ng orders through fitment of HSRP and entry of the laser codes informa on
Transport Commissioners declaring such ac vi es to be on VAHAN in all the states where temporary registra on
illegal and is pushing for stringent ac ons against those has been done away with. The Cer ficate of Registra on
found par cipa ng in/encouraging such ac vi es. I would be issued only once this process is complete.
personally request my dealer friends, not to engage with Hence, I appeal to all dealers not to handover vehicles to
MBOs. the customers ll the me vehicle registra on process is
fully complete.
Establishment of Na onal Dealer Advisory Councils
(NDACs) in all OEMs is a must, as it will go a long way Further, the Department of Heavy Industry (DHI) vide
towards the be er representa on of dealer concerns and no fica on no. F.No.12 (42)/2015-AEI dated October 24, 2020
for more inclusive and transparent rela ons between the has provided 10% concessional GST to Divyang for purchase of
OEMs and their Channel Partners. To ensure that all OEMs cars and MoRTH through no fica on no. GSR 661 (E) dated
work towards the establishment of DACs, I have personally October 22, 2020 has incorporated changes in classifica on.
wri en to the SIAM President for which a reply is awaited. Hence, I request my dealer friends to support and help
Divyangs in their purchase experience. Where, the DMS has
For wider adop on of the Na onal Appren ceship Promo on not been suitably modified to support this concession, I
Scheme (NAPS) by MSME organiza ons, FADA has requested request you to please take it up with your respec ve OEMs to
MSME for simplifying the online procedure of registra on and have the same implemented. From FADA, I have personally
management of appren ces for enabling the smaller wri en to both SIAM President and all PV OEMs to appraise
organisa ons to enjoy the benefits of the program. them about this ini a ve so that their dealers are made aware
and changes in the DMS are suitably done.
FADA recently shared Inventory Funding Rates offered by
5 leading banks- HDFC, AXIS, SBI, Kotak and ICICI in the As I conclude, I request once again for your ac ve
State WhatsApp groups so that dealers could compare par cipa on in all FADA ac vi es and write to me sharing
the same with the rates offered to them by their bankers your thoughts/ ideas for ini a ves FADA should take up in
and in case of any difference, renego ate. However, care future.
must be taken that the rates offered by the banks depend
on the credit-worthiness, balance sheet and creden als Wishing you all A Very Happy & Safe 2021!
of the borrower.
Warm Regards,
MoRTH vide no fica ons in December 2018 and April
2019 has made affixa on of HSRP provided by OEMs for Vinkesh Gula
new vehicles mandatory and has authorised dealers to fix President, FADA
HSRP on old vehicles as well. Therefore, please be [email protected]
informed that it is responsibility of the dealer to ensure
6 F A D A Journal November 2020 | fada.in
India Economics
GDP Q2FY21 | RBI Policy at Status Quo | Inflation & IIP:
Base Turns Favourable | IIP Got Support from Low Base
Manufacturing leads the way Investments surprise on the expected, it is the Government repo rate at 4%. The data also
for the posi ve surprise upside while expenditure expenditure -22% YoY and - showed forex reserves falling
suffers 25% QoQ that has taken away by US$ 0.47 bn in the current
Q2FY21 GVA came in at -7% from the pie. Going forward, week, signalling an easing in
YoY. Manufacturing posi vely On the expenditure front, the Government expenditure RBI’s hold to keep the currency
moved to a growth of 60bps, upside has been from the could see an up ck as the depreciated amidst healthy
helped by a low base of investments contrac ng by - conserva on of cash in Q2 flows.
contrac on of 60bps in 8.9% (vs -47.5% in Q1), gives a higher scope of
Q2FY20, thereby keeping the rebounding to ~88% of pre- expenditure in H2FY21. Core infla on remains s cky
levels at INR 5.8 trillion in covid levels. While there was Nevertheless, the need for owing to higher prices of
constant currency terms- same no significant in up ck in the fresh fiscal expenditure services
levels as in FY19. Industry announcement of new remains for a speedy bounce
group contracted by 2.1% (vs - projects, the up ck is likely a back to growth. The core infla on has
38.1% in Q1) driven by up ck in func on of comple on of remained s cky at 5.8%. The
manufacturing and u li es exis ng projects owing to the Status quo maintained on miscellaneous category which
(4.4% vs -7.1% in Q1). Trade, easing of lockdown liquidity injec on schemes is largely a reflec on of services
hotels, transport, storage and restric ons. Subdued capacity has stayed at 6.9%, with most
communica on, category that u liza on, low credit demand, The last policy of 2020 was categories clocking a
was worst hit from the Covid- fading of global demand and a largely a non-event with no sequen al up ck.
19 pandemic has rebounded general grim sen ment surprises on the either side.
with contrac on at -15.6% YoY reflected in RBI’s industrial The up ck in WPI is also
(vs -47% YoY in Q1), as was also outlook survey. While the RBI con nued to be cau ous noteworthy with
reflected in high frequency sequen al up ck in private on infla on but shrugged it off manufactured products at
indicators of fastag collec ons, consump on -11% YoY and as more supply side driven and 2.9%, highest since December
e-way bills, mobility etc. +23% QoQ was largely turned a li le op mis c on 2018. The easing of supply and
growth thereby holding the weather related shocks have
Investments Outperform Expecta ons While Government Expenditure Dips
Source: CEIC & FADA Research
8 F A D A Journal November 2020 | fada.in
India Economics
aided in the so ening of the IIP got support from low base (20% YoY) and Other Transport of sequen al down ck in
food. Equipment (27% YoY). produc on.
The IIP numbers were aided by
RBI men oned in the latest a heavy base effect of Oct-19 While overall manufacturing India’s IIP had its support from
MPC that it sees a transient fall contrac on at -6.6%. Of the 23 has moved into the growth global demand, which itself is
in infla on in winter months, manufacturing industries, 14 trajectory, labour intensive faltering, as seen in global
with CPI infla on projected at showed an expansion in manufacturing con nues to economic data and exports
6.8% for Q3FY21, 5.8% for October, aided by a strong suffer. The PMI manufacturing performance. Therefore,
Q4FY21 and 5.2-4.6% for the growth in Pharmaceu cals has declined to 56.3 in adjusted for base effects, IIP
first half of the next financial (12.9% YoY), Chemicals (9.6% November from 58.9 in ac vity may fla en from
year. YoY), Electrical Equipment October, a cue in the direc on hereon.
Inflation Inches Up Further
Trends In IIP And Its Components
Source: CEIC & FADA Research
fada.in | November 2020 F A D A Journal 9
Auto Retail Registration
FADA Releases November’20 Vehicle Registration Data
Ÿ Tractors and PVs kept the fes ve spirits going by registering a growth of 48.7% and 13.6% but a bigger drop in 2W, CV and
3W by -6.31%, -22.29% and -60.27% pulled down the registra ons by -4.74% during the 42-days fes ve period.
Ÿ While Vehicle Registra ons in November con nued to grow by 29.32% on MoM basis, it fell by 19.29% on YoY basis.
Ÿ For the month of November, Tractors and PV grew by 8.47% and 4.17% YoY. 2W, CV and 3W con nued to fall by -21.4%, -
31.22% and -64.98% YoY respec vely.
Ÿ While inventory level for PVs (25-30 days) is now closer to FADA recommended range of 21 days, 2W inventory con nues to
be in high range of 45-50 days.
Ÿ PV Dealers con nues to face supply side issues.
Ÿ FADA once again requests the Government to increase Infra Spending (including mely payment) and urgently announce
an a rac ve Incen ve based Scrappage Policy to revive M&HCV segment.
All-India Vehicle Registra on Data for November’20 with YoY Comparison
PASSENGER TRACTOR Commercial
VEHICLE Vehicle
Nov’20 Nov’19
Nov’20 Nov’19 49,313 45,462 Nov’20 Nov’19
2,91,001 2,79,365 50,113 72,863
8.47%
4.17% - 31.22%
Two Three
Wheeler Wheeler
Nov’20 Nov’19 Nov’20 Nov’19
14,13,378 17,98,201 24,185 69,056
- 21.40% - 64.98%
Disclaimer: Source: FADA Research
1. The above numbers do not have figures from AP, MP, LD & TS as all these States/UT’s are not yet on Vahan 4.
2. Vehicle Registra on Data has been collated as on 06.12.20 and in collabora on with Ministry of Road Transport & Highways, Government of India and has been
gathered from 1,265 out of 1,472 RTOs.
3. 42 days fes val period in 2020: 17-10-20 ll 28-11-20 and in 2019: 29-09-19 ll 09-11-19.
10 F A D A Journal November 2020 | fada.in
Auto Retail Registration
OEM wise Market Share Data for the Month of November’20 with YoY comparison
Passenger Vehicle (PV)
OEM Name Nov'20 Market Share Nov'19 Market Share
(%), Nov'20 (%), Nov’20
MARUTI SUZUKI INDIA LTD 1,35,272 48.42%
HYUNDAI MOTOR INDIA LTD 1,43,554 49.33% 49,565 17.74%
TATA MOTORS LTD 13,514 4.84%
KIA MOTORS INDIA PVT LTD 47,162 16.21% 10,572 3.78%
MAHINDRA & MAHINDRA LTD 18,945 6.78%
HONDA CARS INDIA LTD 21,835 7.50% 10,646 3.81%
TOYOTA KIRLOSKAR MOTOR PVT LTD 10,620 3.80%
RENAULT INDIA PVT LTD 18,262 6.28% 9,752 3.49%
FORD INDIA PVT LTD 6,613 2.37%
MG MOTOR INDIA PVT LTD 15,951 5.48% 2,460 0.88%
SKODA AUTO VOLKSWAGEN INDIA PVT LTD 7 0.00%
MERCEDES-BENZ INDIA PVT LTD 9,685 3.33% 1,223 0.44%
NISSAN MOTOR INDIA PVT LTD 1,853 0.66%
BMW INDIA PVT LTD 9,072 3.12% 954 0.34%
FIAT INDIA AUTOMOBILES PVT LTD 828 0.30%
VOLKSWAGEN AG/INDIA PVT LTD 9,001 3.09% 2,658 0.95%
JAGUAR LAND ROVER INDIA LTD 317 0.11%
VOLVO AUTO INDIA PVT LTD 5,856 2.01% 196 0.07%
SKODA AUTO INDIA/AS PVT LTD 1,192 0.43%
FORCE MOTORS LTD, A FIRODIA ENTERPRISE 3,043 1.05% 634 0.23%
MERCEDES-BENZ AG 0 0.00%
PORSCHE AG GERMANY 2,781 0.96% 33 0.01%
AUDI AG 260 0.09%
AUTOMOBILI LAMBORGHINI SPA 865 0.30% 1 0.00%
ROLLS ROYCE 4 0.00%
FERRARI INDIA PVT LTD 801 0.28% 3 0.00%
BENTLEY MOTORS LTD 3 0.00%
Others 728 0.25% 1,240 0.44%
719 0.25%
209 0.07%
199 0.07%
169 0.06%
164 0.06%
158 0.05%
32 0.01%
27 0.01%
27 0.01%
4 0.00%
1 0.00%
1 0.00%
0 0.00%
695 0.24%
Total 2,91,001 100.00% 2,79,365 100.00%
fada.in | November 2020 F A D A Journal 11
Auto Retail Registration
OEM wise Market Share Data for the Month of November’20 with YoY comparison
OEM Name Two Wheeler (2W) Market Share Nov'19 Market Share
(%), Nov'20 (%), Nov'20
Nov'20 6,83,591 38.02%
37.14% 4,59,774 25.57%
HERO MOTOCORP LTD 5,24,986 26.89% 2,42,824 13.50%
HONDA MOTORCYCLE AND SCOOTER INDIA (P) LTD 3,80,088 13.84% 2,21,063 12.29%
TVS MOTOR COMPANY LTD 1,95,559 10.82% 3.38%
BAJAJ AUTO LTD 1,52,965 60,694 3.58%
SUZUKI MOTORCYCLE INDIA PVT LTD 3.62% 64,368 2.87%
ROYAL-ENFIELD (UNIT OF EICHER LTD) 51,194 3.46% 51,581 0.34%
INDIA YAMAHA MOTOR PVT LTD 48,881 3.34% 0.21%
PIAGGIO VEHICLES PVT LTD 47,208 0.33% 6,201 0.01%
CLASSIC LEGENDS PVT LTD 0.23% 3,842 0.01%
BMW INDIA PVT LTD 4,722 0.03% 0.02%
ADISHWAR AUTO RIDE INDIA PVT LTD 3,203 0.01% 263 0.01%
INDIA KAWASAKI MOTORS PVT LTD 0.01% 151 0.00%
H-D MOTOR COMPANY INDIA PVT LTD 427 0.00% 293 0.00%
TRIUMPH MOTORCYCLES (INDIA) PVT LTD 176 0.00% 212 0.00%
DUCATI INDIA PVT LTD 109 0.00% 0.18%
DUCATI MOTOR HOLDING SPA 0.00% 68
Others including EV 69 0.26% 23
59
2
4 3,251
1
3,727
Total 14,13,378 100.00% 17,98,201 100.00%
OEM Name Nov'19
Commercial Vehicle (CV) Market Share
(%), Nov'20
Nov'20 Market Share
(%), Nov'20
TATA MOTORS LTD 17,584 35.09% 29,902 41.04%
MAHINDRA & MAHINDRA LTD 16,876 33.68% 20,932 28.73%
ASHOK LEYLAND LTD 12.09% 13.63%
VE COMMERCIAL VEHICLES LTD 6,060 9,934
MARUTI SUZUKI INDIA LTD 2,578 5.14% 3,216 4.41%
DAIMLER INDIA COMMERCIAL VEHICLES PVT LTD 2,231 4.45% 2,672 3.67%
FORCE MOTORS LTD, A FIRODIA ENTERPRISE 1.70% 1.33%
SML ISUZU LTD 850 0.95% 968 1.42%
Others 475 0.74% 1,035 0.83%
Total 369 6.17% 4.94%
3,090 100.00% 608 100.00%
50,113 3,596
72,863
12 F A D A Journal November 2020 | fada.in
Auto Retail Registration
OEM wise Market Share Data for the Month of November’20 with YoY comparison
Three-Wheeler (3W)
OEM Name Nov'20 Market Share Nov'19 Market Share
(%), Nov'20 (%), Nov'20
BAJAJ AUTO LTD 30,711
PIAGGIO VEHICLES PVT LTD 8,795 36.37% 12,076 44.47%
ATUL AUTO LTD 4,492 18.57% 17.49%
MAHINDRA & MAHINDRA LTD 1,065 4,079
TVS MOTOR COMPANY LTD 4.40% 4,468 5.91%
Others including EV 988 4.09% 1,119 6.47%
Total 658 2.72% 16,603 1.62%
8,187 33.85% 69,056 24.04%
OEM Name 24,185 100.00% 100.00%
Nov'19
Tractor Market Share Market Share
(%), Nov'20 (%), Nov'20
Nov'20
MAHINDRA & MAHINDRA LTD (TRACTOR) 11,966 24.27% 11,406 25.09%
MAHINDRA & MAHINDRA LTD (SWARAJ DIVISION) 8,510 17.26% 7,311 16.08%
INTERNATIONAL TRACTORS LTD 5,747 11.65% 5,320 11.70%
TAFE LIMITED 5,609 11.37% 4,952 10.89%
ESCORTS LTD (AGRI MACHINERY GROUP) 4,753 5,008 11.02%
JOHN DEERE INDIA PVT LTD (TRACTOR DEVISION) 4,238 9.64% 3,539
EICHER TRACTORS 3,067 8.59% 3,293 7.78%
CNH INDUSTRIAL (INDIA) PVT LTD 2,060 6.22% 1,688 7.24%
KUBOTA AGRICULTURAL MACHINERY INDIA PVT LTD 768 4.18% 601 3.71%
VST TILLERS TRACTORS LTD 392 1.56% 372 1.32%
FORCE MOTORS LTD, A FIRODIA ENTERPRISE 259 0.79% 225 0.82%
CAPTAIN TRACTORS PVT LTD 178 0.53% 198 0.49%
INDO FARM EQUIPMENT LTD 126 0.36% 159 0.44%
Others 1,640 0.26% 1,390 0.35%
Total 3.33% 3.06%
49,313 100.00% 45,462 100.00%
Source: FADA Research
Disclaimer:
1. The above numbers do not have figures from AP, MP, LD & TS as all these States/UT’s are not yet on Vahan 4.
2. Vehicle Registra on Data has been collated as on 06.12.20 and in collabora on with Ministry of Road Transport & Highways, Government of India and has been
gathered from 1,265 out of 1,472 RTOs.
3. 42 days fes val period in 2020: 17-10-20 ll 28-11-20 and in 2019: 29-09-19 ll 09-11-19.
fada.in | November 2020 F A D A Journal 13
FADA Research
Passenger Vehicle Registration in India - Trend Analysis
OVERVIEW majority of the customers The Passenger Vehicle fes val offers further
held on to their purchase due registra ons were lowest in contributed to posi ve
Indian PV industry witnessed to the on-going transi on Apr’20 at 22,048. This was growth.
single-digit growth in terms period from BS-IV vehicles to majorly due to a na onwide
of vehicle registra on during BS-VI and in expecta on of a lockdown imposed by the Passenger vehicles running
FY’17 (Apr’16 – Nov’16) and fire sale towards the end of Government to fight the on petrol have a market
FY’18 (Apr’17 – Nov’17). March’20. pandemic. However, at a share of 77.42% in FY’21
later stage vehicle (Apr’20 – Nov’20). This
In FY'19 (Apr’18 – Nov’18) & During the period Apr’20 – registra ons showed a increased from 54.66% in
FY’20 (Apr’19 – Nov’19) Nov’20, registra ons posi ve growth during the FY’18 (Apr’17 – Nov’17),
Passenger Vehicle dropped by -29.51%, as month from Jun’20 – Sep’20 whereas market share of
registra ons declined by - vehicle sales largely depend on MoM basis, though on YoY diesel declined from 39.09%
0.21% and -7.83% as on Country’s GDP and overall the numbers were s ll in red. in FY’18 (Apr’17 – Nov’17) to
compared to 8.97% and consumer sen ment, both of September’20 on YoY basis 16.03% in FY’21 (Apr’20 –
8.94% in FY'18 (Apr’17 – which were at historic lows achieved a mark of 12.50%. Nov’20) largely due to higher
Nov’17) and FY'17 (Apr’16 – due to Covid-19 pandemic. cost of diesel vehicles in BS-6
Nov’16) respec vely. The highest number of regime. Also, Maru Suzuki
Covid-19 has brought forth registra ons (2,94,487) was which holds ~50% market
Growth dropped due to weak the economic turmoil and recorded in Nov’20 reaching share has stopped
sen ment during August’19 prevented buyers from pre-Covid-19 levels largely produc on of diesel variant
and September’19 by 8.64% inves ng in big- cket due to new launches BS-6 vehicles.
and 7.38% largely due to purchases. Moreover, the especially compact SUV’s
con nuance of heavy lockdown not only disrupted which con nued to show LPG/CNG vehicles have more
monsoons and Shradh supply chains but also forced good demand coupled with or less been in the 6% market
period, which led to subdued people to delay spending. Dhanteras-Diwali and share in the last four years.
registra ons. Passenger Marriage Season. Moreover, Alterna ves such as superior
Vehicle registra ons slipped RISING PASSENGER VEHICLE the support from Banks and petrol variants, CNG, and
into nega ve during the REGISTRATIONS – POST NBFCs through various hybrids will recover the share
period Apr’19 – Nov’19 as COVID-19 of diesel variant vehicles in
the market soon. Moreover,
Figure 1: Passenger Vehicle Registration in India, FY’17 (Apr’16 – Nov’16) – FY’21 commercial fleet customers
(Apr’20 – Nov’20) of Maru Suzuki may
completely shi to CNG to
8.94% 8.97% 19,65,960 18,12,020 maintain their profitability.
18,07,973 19,70,148 - 0.21% -7.83% Majorly due to the large price
differen al between diesel
12,77,215 and CNG vehicles coupled
with mul ple OEMs
launching new CNG variants
a er the implementa on of
new emission norms (BS-VI).
- 29.51% OEM WISE MARKET SHARE –
PASSENGER VEHICLE
FY'17 (APR'16-NOV'16) FY'18 (APR'17-NOV'17) FY'19 (APR'18-NOV'18) FY'20 (APR'19-NOV'19) FY'21 (APR'20-NOV'20) Maru Suzuki, the market
leader in the passenger
PV Registration YoY Growth (%) vehicle segment, held
49.76% market share in FY’21
Source: FADA Research
Note: The above numbers do not have figures from AP, MP, LD & TS and is as of 14th December 2020
14 F A D A Journal November 2020 | fada.in
FADA Research
Figure 2: Passenger Vehicle Registration in India, April – November (2019 & 2020) (Apr’20 – Nov’20). Hyundai
motor accounted second-
12.50% highest market share
accoun ng 17.74%, followed
5.41% by TATA motors (7.64%), KIA
Motors India (5.22%),
-5.11% -6.30% Mahindra & Mahindra
(5.15%), Renault India
-23.72% (3.15%), Toyota (2.94%),
Honda Cars (2.82%) and Ford
-37.45% India (1.95%) respec vely
during FY’21 (Apr’20 –
2,73,980 2,79,362 Nov’20).
2,36,173 2,36,126 2,05,191 2,10,593 1,92,397
-86.47%
-90.66% 1,78,198
22,048
31,941 1,28,341 1,60,639 1,82,567 2,00,466 2,56,726 2,94,487
APR MAY JUN JUL AUG SEP OCT NOV Hyundai Motor has increased
its market share from 15.72%
PV Registrations (2020) PV Registrations (2019) YoY Growth (%) in FY’19 (Apr’18 – Nov’18) to
17.74% in FY’21 (Apr’20 –
Figure 3: Passenger Vehicles Penetration on the basis of Fuel, FY’18 (Apr’17 – Nov’17) Nov ’20). Similarly, TATA
motors and KIA Motors have
– FY’21 (Apr’20 – Nov’20) increased their market share
from 6.46% and 0.0% in FY’19
0.18% 0.10% 0.08% 0.19% (Apr’18 – Nov’18) to 7.64%
6.08% 6.97% 6.57% 6.36% and 5.22% in FY’21 (Apr’20 –
Nov’20).
16.03%
On the other hand, Honda
39.09% 37.23% 32.79% cars and Mahindra &
Mahindra witnessed a
77.42% decline in their market share
from 5.38% and 7.24% in
54.66% 55.70% 60.56% FY’19 (Apr’18 – Nov’18) to
2.82% and 5.15% in FY’21
FY'18 (APR'17- NOV'17) FY'19 (APR'18 - NOV'18) FY'20 (APR'19 - NOV'19) FY'21 (APR'20 - NOV'20) (Apr’20 – Nov’20).
Petrol Diesel LPG/CNG Others
Source: FADA Research
Note: The above numbers do not have figures from AP, MP, LD & TS and is as of 14th Dec’20. Others include Electric, Ethanol, Solar & Others
Figure 4: OEM Wise Market Share (in %age) on the Basis of Registrations
5.72% 49.82% 0.52% 48.49% 0.94% 49.76%
2.56% 1.25% 4.59% 1.95% 2.70%
2.83% 2.58% 2.82%
4.27% 2.66% 2.94%
4.33% 3.15%
5.38%
4.76% 5.15%
6.46% Fy’19
(Apr’18 – Nov’18) 5.80% Fy’20 5.22% Fy’21
(Apr’19 – Nov’19) (Apr’20 – Nov’20)
7.24%
7.80% 7.64%
15.72% 17.21% 17.74%
MARUTI SUZUKI HYUNDAI MOTOR TATA MOTORS KIA MOTORS MAHINDRA & MAHINDRA RENAULT INDIA TOYOTA KIRLOSKAR HONDA CARS FORD INDIA MG MOTOR Others
Source: FADA Research
Note: The above numbers is as of 14th Dec’20. Others include Skoda, Nissan, Fiat, Volkswagen, Audi, Mercedes, BMW and many more.
fada.in | November 2020 F A D A Journal 15
Demystifying GST
Applicability of Service Tax on Discounts / Incentives in
Automobile Sector and Facing Enquiries / Investigation
DR SANJIV AGARWAL Introduc on • DealerTradeDiscountScheme. fixed discounts / incen ves
Chartered Accountant from manufacturer subject to
M/s Agarwal Sanjiv & The retail sale of various motor • Quarterly Bonus/Incen ve the verifica on of claim made
Company vehicles, which include two Scheme. by dealer. Discount provided
wheelers, three wheelers, four by the manufacturer is related
MS NEHA SOMANI wheelers, various types of • Annual Consistency Bonus. to sales only and has nothing
Chartered Accountant passenger cars, commercial to do with services.
M/s Agarwal Sanjiv & vehicles and tractors etc. is • Star Bonus
Company done in India through a large It is a fact that the ac vi es
network of automobile dealers The manufacturers of motor between manufacturer and
(members of FADA). The retail vehicles may offer Target and dealer are pure trading
sale of vehicles is done by Non-Target based discounts to services of sale and purchase
dealers on a principal to its dealers as agreed upon. The of vehicles and there is no
principal basis by engaging in dealer who achieves the target service element involved
retail trade (buying from O&M of purchase/sale in case of therein.
suppliers and billing/ invoicing Target based discount and who
to ul mate customers, such passes on the discount as per Taxability under service tax
ac vi es are trading ac vi es circulars issued to end regime
for the dealers. customer in case of Non-target
based discounts, gets quan ty The scope of service as defined
As a normal trade prac ce, in discount/ trade discount/ in sec on 65B (44) of Finance
order to promote business, reimbursement and accounts Act, 1994 does not include
various sales promo on for in its books of accounts trading ac vi es and service
schemes are adopted and under the income as ‘other tax is leviable only on taxable
followed by the companies opera ng income’. This does services in terms of charging
under which discounts and/or not relate to any taxable sec on 66B of the Finance Act,
incen ves called by different service, whatsoever, rendered 1994. The sum and substance
names are offered to the by the dealers to its customers of the transac on has nothing
dealers who may or may not or to the manufacturers. to do in service and as such,
inturn pass it on to the any discount or incen ve
customers based on their sole The manufacturers provide a ributable to such trading
discre on / market such discounts by way of credit ac vity cannot be considered
compe on. notes wherein amounts are as considera on which is
credited to dealer's account ineligible to service tax. If at all,
Types of discount prevalent a er verifica on of documents any service element is three,
and details of each dealer. these are otherwise already
Trade / commercial discounts taxable as authorized service
are a part of normal business In the credit notes issued to sta on category.
ac vity in auto industry. eligible dealers, manufacturer
specifies certain amount of The issue revolves around
These discounts are called by bonus/discount for specific discount which is neither a
different names such as : vehicle which has accrued to considera on nor a ributable
• Trade Discount dealer models. Observing and to any rendering of service,
• Quan ty Discount implemen ng such scheme by whatsoever. According to
• Target Discount dealer is as per the obliga on charging sec on 66B, since no
• Target Incen ve s pulated in dealership taxable service is involved, any
• Royalty bonus and so on agreement, and the dealer was amount of discount, even if it is
required to implement these assumed for a moment to be a
The automobile have dealers a schemes while selling the considera on, it will not be
prac ce of giving the following vehicles, and in return the liable to Service Tax.
schemes: dealer received certain pre-
16 F A D A Journal November 2020 | fada.in
Demystifying GST
According to sec on 65, Taxability under GST Regime (d) I s s u a n c e o f S u m m o n s /officers to be used later
service tax can be levied only as an evidence, it may
if charging sec on is a racted Treatment of discounts under under sec on 14 of Central issue a Summons under
i.e., there exists an ac vity GST laws (sec on 15 of CGST Excise Act, 1944 read with sec on 14 of Central
which can be covered under Act, 2017 read with rules 28 to sec on 83 of Finance Act, Excise Act, 1944 read with
the scope of service under 35 of CGST Rules, 2017) can be 1994 sec on 83 of Finance Act,
sec on 65B(44) of Finance 1994. The issuance of
Act, 1994, there is a summarized as under: (e) Issuance of Show Cause summon is a harsh step on
considera on under sec on the part of Department
67, there is a co-rela on No ce (SCN) without any and must be taken
between the ac vity and seriously.
considera on and two par es tenable legal basis
are present : service provider It is desirable for
and service recipient. (f) Adjudica on and confir- taxpayers to posi vely
ma on of unreasonable a end to SCN’s by fully
The dealers provides services demand of tax complying with it. If the
on principal to principal basis summon is to appear
which is evidenced by the fact (g) I m p o s i n g p e r s o n a l personally, it should be
that the dealer is engaged in personally a ended to. It
trading ac vi es and not as an penal es on directors of may be noted that
agent of the manufacturers of summon is only an
the vehicles. Further, the dealer company / partners enquiry and not an
dealer is showing the purchase allega on or no ce.
from manufacturers in its of dealer firm
Trading and Profit & Loss Dealers may keep the
Account and the balance as In case of supply of motor The challenge faced by the following points in mind:
closing stock a er the sale of vehicles by dealers or for that dealers in respect of above is
such vehicles which clearly purpose for any supply, (i) A end to / respond
proves that such discount / discounts do not form part of how to face such enquiries / to summons
incen ve is not income for the transac on value. The law inves ga on. It may be
dealers. In the present case, therefore, is very clear under desirable to consider the (ii) F u r n i s h r e q u i r e d
neither there is a supplier of the GST regime so far as following line of ac on: informa on in full or
service nor a recipient of in parts, if all such
service and even any taxability of discounts is a) Submission of Informa on informa on is not
considera on is missing and available
therefore, charging sec on concerned. / Documents :
under Service Tax is not at all (iii) S e e k m e f o r
a racted. Facing Enquiries / Inves ga on Since the informa on submission of
sought by the Department documents, if not
These discounts are being It is learned that Revenue is for the past period, there ready
shown as discount under Authori es are presently in the should not be a problem in
‘Other Income’. Merely by process of conduc ng submi ng copies of (iv) R e q u e s t f o r
following an acceptable inquiries / inves ga on in balance sheet, P & L adjournment if the
accoun ng prac ce, the rela on to alleged tax evasion Account and any statement date and me is not
amount of discount doesn’t involving non / short payment of account. If any details are suitable with reasons.
become a considera on in any of service tax on various types sought which have to be
form and the ac vity doesn’t of discounts or incen ves by compiled from books, the (v) If statement is being
become a taxable service. The the dealers during the service same should be compiled recorded, submit
nature of transac on has to be tax era (pre-GST regime). and submi ed. If required, only the truth which
governed by facts and any can be later
different recording can’t Such enquiries / inves ga on me may be sought for substan ated with
change the color of include one or more of the doing so. Non co-opera on facts and documents.
transac on. following: / non-submission of If not sure, it will be
documents at this stage be er not to answer
(a) Calling for informa on may invite further ac on by rather than giving a
the Department. wrong answer.
(b) C a l l i n g f o r b o o k s o f
Responding to Summons:
accounts, records and
financial statements b)
(c) Issuance of Summons to In case of non co-opera on
top management by the assessees or where
including Managing the Department wants to
Director, Chief Execu ve understand the
Officer and Finance Team transac ons and / or wish
and recording their to record the statement of
statements assessee’s management
fada.in | November 2020 F A D A Journal 17
Demystifying GST
It may be noted that following points: covering all aspects (v) A er personal hearing,
statement can be used as an including valua on, adjudica on order is
evidence during adjudica ons (I) Any SCN must be taxability, penalty etc. received which may be
Further, any wrong statement replied to in detail understood, reviewed
is liable for criminal giving facts and (iv) While adjudica on, and further ac on
prosecu on. grounds of defence taxpayers are allowed taken, including
explaining why SCN an opportunity of appeal.
c) Re s p o n d i n g to S h o w should not be being heard which
Cause No ces (SCN) : proceeded with. can be availed of and Conclusion
must be a ended to,
Issuance of SCN is a pre- (ii) The reply must be preferably along with Based on above discussion, it is
requisite for adjudica on submi ed within a Chartered advisable to face enquiry with
and opportunity to reply s pulated me or Accountant / confidence and full
to SCN and being heard extension of me be Advocate to plead the prepara on. Dealers may take
before adjudica on are sought for. case. On such an the help/ advise of their local
principles of natural occasion, addi onal consultants or FADA
jus ce, to be mandatorily (iii) Professional advise submissions / empanelled consultants for
followed. may be sought for evidences can also be proper representa on of the
reply as it should be made. ma er.
Dealers may note the legally perfect
Attention: Members
Engagement of GST Consultants
GST consultants – Ms Puloma Dalal and Dr Sanjiv Agarwal, based in Mumbai and Jaipur respec vely, have
been engaged by F A D A on retainership to help members deal with the complexi es of GST law and
procedures. They will, on reference made by F A D A, guide and give opinion on various issues rela ng to GST as
applicable to automobile dealers.
Federa on of Automobile Dealers Associa ons (F A D A) will forward the queries raised by members to
them for their opinion. While Ms Puloma Dalal and Dr Sanjiv Agarwal will, essen ally, give legal posi on
and clarifica on, supported by case law, on various GST issues raised by F A D A Members, those wan ng
to engage them as counsel, will have to pay separately as per terms that may be mutually agreed to.
Member seeking clarifica on or legal posi on related to GST as relevant to automobile dealer, may send
their queries to F A D A , 804-805-806, Surya Kiran, 19, K G Marg, New Delhi – 110 001. (E-mail Id:
[email protected]).
Engagement of CMVR Consultant
CMVR consultant - Mr Hans Kumar, Retd Additional Commissioner, Transport Department, Rajasthan is with
FADA on retainership basis. He is an authority on CMVR Rules and is also approached by MoRTH.
FADA will forward members concern regarding CMVR Act & Rules to Mr Hans Kumar for clarification and suitable
representation ,if any, to be made to the respective State Transport Authorities and to MoRTH where applicable.
Members are requested to mail their queries to [email protected]
18 F A D A Journal November 2020 | fada.in
Govt Circular
Activities (NIC Codes) not covered (with exception of certain categories) under
MSMED Act, 2006 for Udyam Registration-regarding.
fada.in | November 2020 F A D A Journal 19
FADA in News
FADA Wins the Award for
INDUSTRY ASSOCIATION OF THE YEAR at 2020 APAC Association Awards
Federa on of Automobile FADA has achieved amazing results in Here are the winners of other
Dealers Associa ons the auto industry and membership categories of APAC Associa on
(FADA) won the award for progression. The organization has Awards 2020:
INDUSTRY ASSOCIATION OF served as the voice of Indian
THE YEAR 2020 by Glue Up, automotive retail for over 50 years. It • COVID-19 Hero
the leading all-in-one has employed 5 million employees, Associa on Awards -
engagement management from direct and indirect employment, Community Broadcas ng
so ware company in its 4th without displacing them from their Associa on of Australia
Annual APAC Associa on homes. Despite the challenges faced, (CBAA)
Awards due to its contribu on it has managed to build a cohesive,
to the Auto Retail Industry in inclusive, and syndicated body. • Large Associa on of the
India, on December 2, 2020 at Year Award - Planning
Singapore. Charlie P. Villasenior, Philippine Ins tute of Australia (PIA)
Council of Associations and
The awards recognize and Association Executives • Small Associa on of the
celebrate associa ons, Year Award - Interna onal
leaders, and professionals Coach Federa on
who have exemplified the (Singapore Chapter)
highest standards of
excellence and achievement • Professional Associa on
that have significantly changed of the Year Award -
the associa on industry. Optometry Australia
Eric Schmidt, CEO and Co- • The Execu ve of the Year
Founder of Glue Up said, Award - Gordon Williams,
"2020 has been a year of Execu ve, Northern
monumental change. Midlands Business
COVID-19 has acted as a Associa on
catalyst for remote working,
digi za on and technological • Excellence in Technology
advancements. Despite the & Innova on Award -
challenges, many associa ons Philippine Ins tute of
have stepped up and risen to Cer fied Public
challenges." Accountants (PICPA)
“You could see there was a • Best Virtual Event of the
very strong reliance on the Year Award - 36th World
industry. It was Veterinary Associa on
encouraging and inspiring Congress, New Zealand
to see all the things the Veterinary Associa on
associa on community was
doing - it really highlights the • Best Community
power of leading through a Engagement Program
crisis”, Eric added. Award - Women
Entrepreneurship
Despite a year of many Development, Pushp-
challenges, the future of the kiran Union for Real
associa on community has Enlightenment (PURE).
never looked brighter.
20 F A D A Journal November 2020 | fada.in
FADA in News
FADA State Chapters Initiates Dialogue with State Machinery
FADA Punjab Chapter led by State FADA Madhya Pradesh State
Chairperson - Shri Rishi Dada and Regional Director - Mr Ashish
Regional Directors met Transport
Commissioner - Dr. Amarpal Singh, IAS Pandey met Transport
and discussed ways to streamline Commissioner Mr Mukesh Jain and
online/faceless registration process in
the State. handed over a representation for
faceless vehicle registration
implementation.
FADA UP Chapter led by State Chairperson - Shri Sanskar Gupta and Regional FADA A&N Islands Chapter led by Chairperson - Shri Sagar Khurana and
Directors met Transport Commissioner - Shri Dheeraj Sahu and discussed Regional Director met Director of Transport - Dr Navlendra Kr Singh and
ways to streamline online/faceless registration process in the State. discussed ways to streamline online/faceless registration process in the UT.
fada.in | November 2020 F A D A Journal 21
FADA in News
YES Bank Partners with Automobile Industry Ecosystem for
‘Truly Yours’ Week Celebrations
In line with its enhanced focus FADA President - Mr Vinkesh Gulati
on Retail and MSME FADA Vice President - Mr Manish Raj Singhania
segments, YES Bank re-
energised its YES Premia
program, unveiling a premium
banking program that offers
personalized solu ons
focused on the par cular
needs of key consumer
segments - from small
business owners to salaried
professionals and senior
ci zens - through a carefully
curated mix of products,
services, por olio benefits
and partnerships.
This launch was accompanied
by ‘ Truly Yours Week’, a
weeklong celebra on from
1st to 7th December 2020 at
~1100 Yes Bank Branches
across India through a very
high level engagement with
Automobile fraternity. The
Bank celebrated dedicated
OEM days by organizing
vehicle displays across
branches to support
Automobile Industry across
various categories of vehicles
e.g. Passenger Vehicles
(Maru Suzuki, Hyundai,
M&M, Tata Motors); Two
Wheelers (Royal Enfield,
Super bikes); Construc on
Equipment (JCB, Tata Hitachi,
Hyundai, Sany India) and
Commercial Vehicles (Ashok
Leyland, Tata, M&M). These
vehicle displays were also
accompanied by customer
centric events including loan
carnivals, Spot sanc on
ac vi es for Retail and MSME
loans, Health camps etc to
enable customers to avail all
types of banking services.
22 F A D A Journal November 2020 | fada.in
FADA in News
FADA Treasurer - Mr Sai Giridhar Apart from the customer
focused engagements, the
FADA Immediate Past President - Mr Ashish Harsharaj Kale bank also welcomed leading
Automobile Dealers, their
FADA Past President - FADA Karnataka State Chairperson - Families and Sr Management
Mr Nikunj Sanghi Dr M P Shyam team as honourable guests at
the branch for inaugura ng the
Truly Yours Week celebra ons
with Lamp ligh ng and
unveiling the Yes Premia Brand
to the customers. There was a
strong par cipa on witnessed
from Automobile
Manufacturers as well with
their Key Management team
and their Regional Heads
joining the YES Bank efforts in
amplifying the business
momentumforDecembermonth.
FADA President - Mr Vinkesh
Gula , Vice President - Mr
Manish Raj Singhania, Treasurer -
Mr Sai Giridhar, Immediate Past
President - Mr Ashish Harsharaj
Kale, Past Presidents - Mr Nikunj
Sanghi and Mr John K Paul,
Karnataka State Chairperson - Dr
M P Shyam and other FADA
members also graced the
occasion with their presence at
the branches acknowledging YES
Bank’s strong commitment
towards empowering the Retail
and MSME customers across
India with a laser sharp focus on
Automobile ecosystem including
customers, OEMs, dealers and
vendors.
Truly Yours week events
demonstrated mega efforts
from YES bank to engage with
the Business Community,
Automobile Industry, MSMEs
and the customers at large
though comprehensive
Banking and exhibited bank’s
resolve to for fy its posi on as
a truly differen ated retail
bank that places the customers
and partner ecosystem at the
heart of all its opera ons and
innova ons.
fada.in | November 2020 F A D A Journal 23
FADA in News
Automotive Skills Development Council (ASDC) and Federation
of Automobile Dealers Associations (FADA) Join Hands with
Google to Lead Industry’s Digital Transformation
Aim to train over 1 Lakh+ employees across 20,000 dealerships to digitise dealership platforms and capabilities
Recognizing the need to sales and marke ng execu ves Nikunj Sanghi, Chairman, Dealers Associa ons (FADA),
prepare over 20,000 auto via a series of vernacular Automo ve Skills said “With the advent of
dealerships to engage with execu onal videos. This will be Development Council (ASDC), technology and new channels
customers in the ongoing and followed by an online said, “We are collec vely of communica on, the
post pandemic era, assessment and cer fica on experiencing an classical approach to
Automo ve Skills by Google India, ASDC and unprecedented me. COVID- marke ng products and
Development Council (ASDC) FADA. 19 has brought significant services at the local level has
and Federa on of Automobile change and our rela onships undergone a paradigm
Dealers Associa ons (FADA) Commen ng on the ini a ve, have gone digital. Exis ng skills change. Gone are the age-old
have joined hands with Google Nikhil Bansal, Head of will require a lot of redefini on prac ces of relying on inserts,
India to bridge the digital skill Automo ve, Google India, said and skilling will play a major banners, and small print ads to
gap in the country’s auto “Over the years, the window to role when we re-enter the new gain exposure. Today, geo-
dealerships and build their influence purchase decisions world. We need to train the loca on targe ng, hyperlocal
capacity in this cri cal growth through offline efforts has workforce on how to use marke ng and other sharply
driver. become smaller. The average digital tools and train the defined digital marke ng
number of visits to dealerships en re ecosystem to monitor techniques have
Industry experts believe that in India fell by 50% over the last their efficiency. Hence to revolu onized the adver sing
some customers may not wish three years from 2016 to 2019. maintain market con nuity, industry. The digital
to visit a dealership as many And now, COVID-19 has made both ASDC and FADA, with the movement by the dealers’
consumers further reluctant to help of Google, are helping the community reaffirms FADA’s
mes as before prior to making visit car dealerships, and as a dealerships become as ac ve strong commitment to retain
a purchase decision, and result, walk-ins are even fewer. as original equipment the dynamism of dealer
hence, there is an urgent need To aid business recovery, auto manufacturers (OEMs) on business in the automobile
for automo ve retail to players are encouraged to take digital pla orms. We are also ecosystem and also assure its
become virtual, lean, and their dealerships to customers, constantly working towards par cipa on in Government’s
flexible. online. We have been working enhancing our skill Digital India Movement in the
with leading auto OEMs to development ini a ves post-COVIDworld. The
Tailor-made by Google India help them digi se their keeping in pace with the Google–ASDC–FADA webinars
under its “Grow with Google” dealership networks, and with rapidly changing technology are hence aimed to prepare
ini a ve, the training program this ini a ve, we are now trends and emerging industry Dealer Principals and their
will be conducted via a series bringing our learning and needs. teams to stay ahead in the
of webinars on Digital support to handhold the larger game in mes to come.”
Marke ng, Hyper Local auto dealer ecosystem to go ASDC assessment and
Marke ng, and Full Funnel digital in collabora on with cer fica on will help in The ini a ve focuses on
Strategy on Google India’s ASDC and FADA. We are really boos ng the competency and training over 20,000+ auto
YouTube channel. The focus of excited to join hands with the compe veness of industry dealerships across the country
the program is on empowering industry in this first-of-its-kind stakeholders”. to build an online presence,
dealer principals to adopt ini a ve to help the dealer and providing digital skill
digital tools and pla orms to fraternity and support them in Talking about the webinars, training to 100,000+ auto
engage with customers. In its this necessary transi on." Vinkesh Gula , President, dealers across the marke ng
second phase, the program Federa on of Automobile and sales divisions.
also aims to train frontline
24 F A D A Journal November 2020 | fada.in
FADA in News
Virat Vaibhav Novodaya Times
Virat Vaibhav
The Financial Express Financial Express (Guj.) Rashtriya Sahara
Absolute India Hindustan Business Standard Pragativadi
Samay Paribartan People Samachar
fada.in | November 2020 F A D A Journal 25
FADA in News
Financial Express The Hindu Business Line
Business Standard The Hindu
The Asian Age
Times of India Free Press Journal New Indian Express
Dainik Bhaskar
Telegraph
Amar Ujala
26 F A D A Journal November 2020 | fada.in
FADA in News
fada.in | November 2020 F A D A Journal 27
One Nation | One Association Federation of Automobile Dealers Associations (FADA)
invites its members to participate in
Tuesday - thursday
February 9-11
The NADA Show Expo is the auto industry's premier marketplace of products, services and
technologies specically targeted to franchised new car dealerships. Join thousands of
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stop content to help you connect, learn and
build your business from the comfort of your ü 60+ Education Sessions and the Virtual
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A progressive dealer should not miss this ü Translated workshops
opportunity.
ü NADA Expo shopping, exhibitor
Registration appointments & product demos
Special Fee for Member : INR 18,000 + GST @ 18% ü NADA Welcome Reception
ü Women Dealers Retail Happy Hour
ü Downloadable resources
ü On-demand session recordings
Book Your Seat Immediately
For any further clarication, please contact: Ms Indira Menon at +91 99682 81214 or e-mail to [email protected].
Enterprise
Why Less is More for Wow! Momo
For the rapidly growing Kolkata-based QSR chain, the small kiosk embedded in a mall has proven
to be a profitable idea. Especially when it serves one of India’s favourite fast foods.
Sagar Daryani, CEO & Co-Founder of
Wow! Momo Foods
The story of how Sagar admi edly restless Daryani, give a loan to a fresher without kiosks within the mall’s
Daryani, co-founder-CEO, having finished his final-year any collateral.” premises. Showing the
Wow! Momo, se led on the Bachelor of Commerce resourcefulness essen al for
momo (a type of dumpling examina ons from St. Xavier’s He took the reality check on entrepreneurship, he
na ve to Tibet, Bhutan, Nepal, College in Kolkata, board, returned to Kolkata and managed to set up a mee ng
and the Northeast region in purposefully made his way to started exploring ideas which with the food division head at
India) as his business Mumbai. This was in 2008, and would need minimum Spencer's. As a result, Daryani
proposi on is the kind he wanted to start a business investment. found himself at the right place
Bollywood might lap up. To in the food space. Daryani was and at the right me. Because,
begin with, it is based on a ny open to a range of op ons That’s when fortune—and a while wai ng for this
white lie—the kind that did no —but some ideas were not li le fabrica on—kicked in. appointment, he over-heard
harm to anyone, but helped viable because “to start a [for the execu ve telling a
give the then 21-year-old the instance] bakery business The RP-Sanjiv Goenka Group- colleague that a momo outlet
founda on for his dreams. Add would require about Rs. 30 backed Spencer’s hypermarket would be a good fit for the
to that the narra ve with the lakh - Rs. 50 lakh of ini al had just opened in Kolkata’s mall. “I immediately thought
pace of a blockbuster, reaching investment ”, he says. “I Rash Behari Avenue, of ‘momo aunty’, a lady from
its climax in a mere 45 days. It couldn't arrange that much fortuitously opposite Daryani’s the Northeast who would sell
began when the self- capital. And no bank would family-owned garment shop. momos at my school [St.
He learnt that it wanted fast-
food brands to set up small
30 F A D A Journal November 2020 | fada.in
Enterprise
James’ School],” recalls with 318 outlets across 16 Daryani’s home kitchen and outlets inside large format
Daryani. (Momos, for those ci es—was valued at Rs. 860 transported daily to the kiosk retail stores like Spencer’s, Big
who haven't yet sampled one, crore. As is expected of any by auto. “While coming back, Bazaar (the Future Group
can be steamed or fried, and startup, the first year had the we would take an auto but hypermarket chain),
filled with meat or vegetables. requisite teething issues. walk halfway just to save Rs. Pantaloons, and others in
Easy to understand why they There was the mandatory 10. That’s when we realised Kolkata. Its first standalone
make for a popular street drama, with the chef qui ng the value of money,” says kiosk was set up in 2010, in
food.) the day before the launch. Homagai. The monthly Sector 5, Salt Lake,
“Overnight we had to arrange revenue from the kiosk was Rs. Kolkata—West Bengal’s IT hub.
Daryani sensed an opportunity for another chef. But luckily, 60,000. A few months later, in A year later, however, with
and indulged in, what he calls, the new chef was even be er January 2009, Wow! Momo approximately 17 outlets
a “blatant lie” to help him seal than the previous one,” says opened its second including four standalone
the deal. “I told the execu ves Homagai, 33, co-founder and outlet(about 90 sq. .) inside stores and shop-in-shops, it hit
that I sell momos in St. James’ COO, Wow! Momo. Spencer’s in South CityMall. a plateau on expansion within
School because no one would “That store made us a brand in Kolkata malls. “Many would
take [just] a college student There were opera onal issues Kolkata,” says Daryani. It refuse saying that they already
seriously,” says Daryani, who too. For the first five months, immediately pushed up the have a Chinese food outlet in
had wri en his final year exam the kiosk was managed by the combined monthly revenue to the mall which sells momos,”
a li le over a month ago. “I was founders, a part- me chef and Rs. 2 lakh and, in six months, to recalls Daryani, 32. That’s
asked to bring a sample for a helper. (Today, Wow! Momo Rs. 7 lakh- Rs.8 lakh. when the founders ventured
tas ng the next day... and I ran has over 3,000 employees and outside their home turf and
to ‘momo aunty’ to help us the staffing per kiosk is Since then, it has been a opened a store in
with the sampling. They loved determined by its size.) The smooth enough ride for Wow! Bengaluru’sPhoenix
it. I knew good quality momos momos were prepared at Momo. It opened its first 12 MarketCity food court in 2011.
would sell like hot cakes.” Malls in Chennai and Pune
quickly followed suit.
The management at Spencer’s
seemed to concur, and offered Expansion is not a tough ask for
Daryani (what would become) Wow! Momo because of its
his golden cket: A 36-sq. . easy scaleability. “It can be
kiosk in Spencer’s Tollygunge operated from a 20-sq. . kiosk
area in Kolkata was the to a 1,000-sq. . restaurant,”
founda on for Wow! Momo, says Padmaja Ruparel, co-
which Daryani started with Rs. founder and president, Indian
30,000 borrowed from his Angel Network(IAN), one of
father. He roped in Binod the country’s largest angel
Kumar Homagai, his college investor groups which, in 2015,
friend and a handy momo- invested Rs. 10 crore in the
maker, as partner. business at a Rs. 90-crore
valua on.
This was in August that year,
exactly a month-and-a-half Momos also have the
a er he had decided to amenability from a supply
become a business owner. chain perspec ve where
quality control can be done
Twelve years later, the happy centrally, points out Vinay
fib has led to the crea on of a Singh, partner, Fireside
force in the quick service Ventures, an early-stage
restaurant (QSR) space. investment firm which has
Consider that last September, backed businesses such as
Wow! Momo raised Rs. 130 Bengaluru-based Slay, a ready-
crore (approximately $18 to-drink coffee delivery
million) fromNew York-based service, and food startup
Tiger Global Management. The Samosa Singh. “The momos
firm—a profitable business
fada.in | November 2020 F A D A Journal 31
Enterprise
just require hea ng and Though the business got wings an Ebitda margin of 10%. Indian companies have
serving,” he says, and that adds earlier, Daryani raised his first brought consistency like
to the scaleability. ins tu onal funding—from Product quality and service are Domino’s and McDonald’s to
IAN—only in 2015, by which cri cal in the food business; for QSR, and that remains a
There is also the Indian this, expansion and opera ons differen ator. I hope they
consumer’s growing appe te me it had grown to 43 outlets have to work in tandem. Aware con nue to innovate on their
for grab-and-go foods (salads, across five ci es with an of that, the company works menu,” says Anand Lunia,
momos, box meals, and annual revenue of about ₹20 with hatcheries (Shalimar founding partner at India
snacks) which is a healthy sign crore. The around 96 angel Hatcheries in Kolkata, Godrej Quo ent, an early stage
for kiosk- and delivery-only investors from the IAN Tyson Foods in Bengaluru, for investment firm.
kitchen formats, say industry pla orm included the likes of instance) to maintain the
experts. Plus, over the last five Infosys co-founder Kris quality and hygiene of the The Wow! Momo team’s
years, food-delivery players Gopalakrishnan, the Hero poultry it uses—there is an business ins ncts haven’t let
such as Swiggy, Zomato, and group's Sunil Kant Munjal, and auditor appointed or every them down yet. For instance,
Uber Eats (now part of Arvind Singhal, chairman and seven-eight outlets. as they built scale, the
Zomato) have added to the managing director, Technopak. Streamlining is also a business founders realised the
sustainability of QSR chains necessity and Wow! Momo importance of pu ng
whose business model This gave the chain muscle to has a centralised kitchen for together a team of
eliminates the need for large sit- enter New Delhi (in 2015, in every city. It plans to make the professionals. In 2015, they
down outlets, bringing down the tony Hauz Khas Village) back-end process more offered Shah Mi aur Rahman,
realestatecostsconsiderably. and Mumbai (in 2017). By efficient: The kitchen will only 32, their college
2017, it grew to 108 outlets do the fresh folding of the batchmate,10% equity and a
“Growing profitably with one with an annual revenue of Rs. momos while the fillings will co-founder designa on.
product is not easy to do. But 49 crore, a posi on from which be pre-cooked at a centralised Rahman, a chartered
Wow! Momo has addressed it raised Rs. 40 crore from plant in Kolkata. This plant will accountant, was working with
the latent market poten al in a LighthouseFunds, a private be high-tech and fully PwC India as vice president
comprehensive manner. It has equity firm focussed on the automated, set up in the city’s prior to joining the startup.
been imagina ve in iden fying consumer space. This infusion Kasba Indl Estate. It is expected Currently he looks a er the
a niche and becoming a allowed the founders to offer to be opera onal in two years. finances of the business.
specialist and scaling viably,” profitable exits to about 20 Countrywide, Wow! Momo
says Sandipan Mitra, CEO and investors from the IAN churns out about 500,000 Of course, the rela vely
co-founder, HungerBox, a pla orm (they got momos a day, a largely manual hiccup-free growth of the
Bengaluru-based B2B food- approximately 55% internal effort. “Our plan is to make it business is aided, in no small
tech startup. Of the 318 stores rate of return in two years). automated in the future. The measure, by the
currently, 302 are Wow! Momo size, shape, hygiene, and understanding between the
outlets (across 16 ci es) and 16 The Tiger Global investment in quan ty of the filling should be two founders.“Nature-wise we
(across five ci es) are branded Sep’19 paved the way for 20 uniformised,” says Daryani. To are completely opposite,” says
Wow! China, a fast-food more exits from IAN investors, underscore his seriousness, Daryani. “I am aggressive,
Chinese cuisine format with more than 8x returns. almost a third of the amount op mis c, and restless while
launched in Dec’18. “We have Sachin Bhar ya, partner at raised (about Rs. 50 crore) in Binod is more grounded,
defined the menu in such a LighthouseFunds, says the the last funding round went realis c, and calm. So as a
way that, from a 60-sq. . kiosk, focus on delivering quality into se ng up the back end. team we make a good
we started doing revenue of with an eye on economics will combina on.” The longevity of
about Rs. 14 lakh a month for shape the business in the next But given the largely buoyant their connec on helps too.
Wow! China,” says Homagai, five years. “Their ability to scenario, the founders can’t “Binod was the only friend
referring to crowd-pleasers visualise the opportunity and afford to ignore the hurdles who stood by me a er
such as chicken wrapped execute it well gave us a lot of inherent in a QSR business college,” he adds. “Even
prawn, chilli cheese stuffed confidence [at the me of combined with the threat of though many others had plans
mushroom, Chinese bhel, and investment],” he says. compe on: Wow! Momo to start a business together.”
Burmese Khao Suey, all priced competes with global majors Needless to say, their group
between Rs. 99 and Rs. 300. Wow! Momo is looking to close such as Domino’s, KFC, Pizza studies included a serving of
Needless to say, there is no in- the current financial year with Hut, and Burger King. “QSR is Homagai-made momos. Let’s
house cannibalisa on: Wow! Rs. 180 crore- Rs. 190 crore an execu on game. Very few call it their wow factor.
China doesn’t serve momos. revenue and a total of 350
stores/kiosks. It claims to have
32 F A D A Journal November 2020 | fada.in
Surveys & Studies
electric buses:
INDIA MARKET ANALYSIS
EXECUTIVE SUMMARY losses. Had it not for mely about 1,031 e-buses were sold MARKET OVERVIEW
Government support, the across different states and
Access to efficient mul -modal rising fuel costs over the years transport undertakings. The electric bus market in India
public mobility system is with minimal or no hike in has gained strong momentum
deeply intertwined with the passenger fares would have As per JMK Research over the recent years. Big
socio-economic development led the SRTUs to bankruptcy. es mates, addi onal 1850 OEMs such as Tata Motors,
of any region. Contribu ng to buses are likely to be sold in Olectra Greentech in
this, public road Therefore, there is a FY2021 and around 4640 units partnership with China’s BYD,
transporta on especially tremendous underlying in Fy2022.
public buses in India play a very opportunity for a more Ashok Leyland etc. are
important role as a large part effec ve delivery of road The ebus market growth is confident that the overall
of the society rely on public transport service in India. The fuelled by more than US$1 Bn market environment
transporta on. advent of electric buses (e- worth of investment deals supported by robust
bus) will pave the way for forged in the past few years regulatory framework, would
According to Associa on of future of efficient mass public with investors of varied s mulate the growth of e-bus
State Road Transport transport system. Apart from business backgrounds. To keep sales. Driven by the
Undertakings (ASRTU), India being cleaner and greener, up with the pace of e-bus Government subsidy under
has one of the lowest bus to the major advantage of an e- induc on and deployment FAME schemes along with low
people ra o of less than bus is its extremely low onto the public roads, the opera on and maintenance of
1.5:1000. There are opera onal and maintenance charging systems and allied- e-buses, a growing number of
approximately 1.6 million (O&M) expenditure per unit infrastructure must also be STUs and city bus agencies are
public and private buses in km. The Total Cost of enhanced and/or developed willing to deploy them for
India and another 1 million are Ownership (TCO) of e-buses is systema cally to overcome public transport.
required to cater to the 10-20% lesser than that of local-specific challenges.
transport needs of the general diesel buses. Rise in general awareness
public. Out of the total, only Henceforth, this report shall about air pollu on, climate
0.2 million buses are owned by In September 2017, the first briefly touch upon the change and most importantly
SRTUs. Most of these SRTUs commercial e-bus opera ons significant developments in the increasing diesel prices
(State Road Transport began in India in Himachal the Indian e-bus market, over the years (from around
Undertakings) in India are Pradesh. Since then, the e-bus policies, tender analysis, Rs. 60 per litre in July 2016 to
facing diminishing financial market has evolved charging infrastructure and so close to Rs. 80 per litre in June
returns and incurring heavy substan ally. By March 2020, on. 2020) are some of the reasons
that incen vize most state and
fada.in | November 2020 F A D A Journal 33
Surveys & Studies
city transport authori es to Electricity Supply and buses, the es mated TCO for e-bus procurement models
increasingly accommodate Transport (BEST) of Mumbai 9m and 12m AC diesel buses that have been approved by
clean public transport was next to induct a fleet of e- are Rs. 39 per km and Rs. 58 Department of Heavy
solu ons in their regional buses towards the end of per km respec vely; As for AC Industries (DHI) as a FAME
development plans. 2017. The Goldstone-BYD electric buses with a ba ery criterion are Outright Purchase
supplied a total of 6 buses to cost per unit capacity assumed Model and Gross Cost Contract
During the early days of e- BEST and were deployed in as $200 per kWh (excluding (GCC) model. STU and city bus
buses in India, STUs (State Mumbai suburban sectors. import tariff), buses of 9m agencies show preference to a
Transport Undertakings) and category have an es mated specific mode of e-bus tender
city transport corpora ons Un l FY18, only 31 e-buses TCO of Rs. 35 per km, whereas, predominantly on the basis of
conducted trials to study their were sold in India and all these for 12m bus, it is about Rs. 47 the availability of upfront
feasibility in actual road buses were manufactured by per km . capital, other lifecycle costs,
condi ons. Bengaluru’s BMTC Goldstone-BYD. This number inclina on towards
was the first transport grew mul ple fold in next two The wide gap in TCO of diesel contrac ng outsourced staff
authority to operate e-buses in years and by FY20 addi onal and e-buses of 9m and 12m for e-bus O&M ac vi es,
India albeit under trial in 2014. 1000 e-buses were procured length is primarily due to the exper se level of in-house staff
Following this ini a ve, the by mul ple transport fact that although the capex of for e-bus opera ons.
transport authori es across authori es from a range of electric 12m bus is
several states/ci es such as OEMs/suppliers. substan ally higher than that Outright Purchase Model
Himachal Pradesh, Tamil Nadu, of 9m bus, the difference
Chandigarh, Assam, TCO ANALYSIS: DIESEL VS E-BUSES between the opex charges per In this type of contract model,
Maharashtra, and Delhi also km for 9m and 12m variants which is synonymous to public
conducted e-bus trials in an The upfront costs of electric are dispropor onately smaller. monopoly model, the state
effort to induct them in their buses are more than the diesel government owns the buses
bus fleet. counterparts across all If life-cycle health and and is responsible for planning
lengthbased categories. environmental costs are also and opera on of e-bus
The Himachal Road Transport However, a comparison of the taken into considera on, the services. It is a capital-
Corpora on (HRTC) purchased Total Cost of Ownership (TCO) net cost incurred over the intensive model. Under FAME-
25 Goldstone eBuzz K7 zero- between diesel and electric life me of diesel buses would I, DHI granted 60% subsidy and
emission electric buses from buses reveal that the electric be significantly higher than the remaining 40% was availed
Goldstone-BYD (presently, buses makes more economic that of electric buses. from the SRTCs. Although
known as Olectra-BYD). A few sense. Therefore, holis c cost outright purchase contract
months following HRTC ’s implica on of electric buses in involves high capex, significant
move, the Brihanmumbai Assuming the average driving comparison with diesel buses savings is accrued through
range of 200 km per day for AC is very less. reduced opex or recurring
costs in comparison with
MODES OF E-BUS PROCUREMENT ICEbuses. As the whole O&M
The two broad classifica on of
34 F A D A Journal November 2020 | fada.in
Surveys & Studies
services is under the accessibility to all ci zens to manufacturing ecosystem of Buses on opera onal cost
management of the bus jobs, educa on, social services EVs. It has model basis. DHI planned to
agencies as is the tradi on, and recrea on at affordable sanc on a total of 5,000 buses
states, ini ally, saw preference cost and within reasonable four focus areas: technology for deployment with FAME 2
of outright purchase model development, demand support across 40 ci es. The
over GCC model. However, due me. crea on, pilot projects and maximum demand incen ve
to lack of exper se in e-bus charging infrastructure. The that could be availed under
technologies, STUs or city bus Among the many approaches original scheme did not FAME 2 would be determined
agencies face higher risk of guiding to achieve the policy include demand incen ve on the basis of bus length, the
opera onal failures. objec ves, it also includes the alloca on parameter that was absent in
measure of “use of clean fuel FAME 1.
Gross Cost Contract (GCC) and clean vehicle technology”, for e-buses un l it was par ally
model promoted by way of modified in September 2017, In contrast to having two
incen viza on and addi onal which brought a new incen ve choices under FAME 1 for
GCC mode of procurement is financial support for R&D, structure for ‘fully electric selec on of mode of e-bus
also known as OPEX model. As commercializa on and buses’ (CMVR category – M2 deployment i.e Capex and
per this Public Private implementa on of clean &M3). The two levels of Opex model, Opex mode/ wet
Partnership (PPP) model, the technologies, clean fuel and incen ves offered were lease model of deployment by
contracted operator or the renewable sources of energy, length-agnos c and was only the transport undertaking is
supplier manages the O&M from the central government on the basis of minimum level mandated in order to be
aspects of e-bus service. The of localiza on achieved. eligible for FAME 2 subsidy.
supplier is remunerated on the NEMMP 2020 The bidding model to be
basis of a fixed cost per km. Subsequently, DHI received adopted by operators/
Under FAME 1 scheme, DHI Unveiled in 2013, the na onal- proposals for 3,144 e-buses by suppliers for bus deployment
provides subsidy upto 60% of level guidance document STUs in India. Of which, would be solely Gross Cost
capital cost of e-bus over 3 providing vision and roadmap Government sanc oned Contract (GCC) based bidding.
years in 3 installments of 20% for faster adop on and extension of financial support
each in each fiscal. For subsidy manufacturing of EVs (full for 390 e-buses across 11 ci es Further, NITI Aayog-
under FAME 2, DHI funds upto range of hybrid & electric in December 2017. formulated Model Concession
40% of the es mated cost of vehicles) in India. The target of Agreement (MCA) also known
the bus. GCC model has far the Na onal Electric Mobility By the end of the first phase of as Supply-Cum-Opera on and
more benefits than outright Mission Plan (NEMMP) is to FAME on 31st March 2019, DHI Maintenance Agreement
purchase model. GCC achieve 6-7 million units of sanc oned a total of 425 which must be adopted by the
facilitates substan al hybrid & electric vehicle sales electric and hybrid buses to selected city. According to this
easement in financial in India by 2020. various ci es in the country agreement, the
expenses, quality O&M service with a total cost of about INR concessionaire/ operator/
from specialist outsourced As per the government 300 crores. supplier is responsible to meet
staff. In addi on to this, the bus es mates then, out of the total the financial requirements for
agency is able to focus more on poten al investment of INR FAME 2 procurement of buses,
the vehicle passenger services. 20,000-23,500 crores for opera on & maintenance of
achieving desired EV sales, In March 2019, out of the buses and allied-infrastructure
POLICY SCENARIO - CENTRAL about INR 1100 – 1300 crores proposed EV fund support of whereas the transport
will be required for suppor ng INR 8596 crores (via demand corpora on shall incur
Na onal Urban Transporta on growth of hybrid and electric incen ves), e-bus segment
Policy (NUTP) bus sales by 2020. was allocated INR 3,545 crores.
A maximum of 7,090 buses is
First framed in 2006 and then FAME 1 planned to be supported
revised in 2014, NUTP aims at through phase-II of the
bringing about comprehensive As an ini a ve under NEMMP, scheme.
improvements in urban the Department of Heavy
transport services and Industries (DHI) formulated In June 2019, DHI invited
infrastructure by planning for FAME scheme to support Expression of Interest (EoI)
the people rather than market development and from million-plus ci es, smart
vehicles by providing ci es, State/UT capitals and
sustainable mobility and ci es from special category
states for submission of
proposal for deployment of E-
fada.in | November 2020 F A D A Journal 35
Surveys & Studies
opera onal cost on per km project non-viability employed by state or city race is Maharashtra, having
basis. associated with the price of transport undertaking, hence, published tenders with
the winning bid. The table most of these corpora ons cumula ve bus orders of 550.
Subsquently, DHI received an below represents summary of released tenders under
overwhelming response of 86 sanc oned tenders under Outright Purchase Model, FAME–2
proposals from 26 States/UTs FAME 1 that have reached leading to more successful
for the deployment of 14988 e- culmina on. Except Olectra- tenders/ contract awards GCC gradually became the
buses. Upon evalua on of all BYD, all supplier OEMs had bid under this model than opex or preferred model for many
proposals, 5,595 electrical via outright purchase mode. GCC model. Among all the cash-strapped SRTCs
buses had been sanc oned by WBTC floated the largest culminated tenders under (especially when the
DHI to various State/ City (individual or cumula ve) FAME 1, about 74% of the total procurement order was large),
Transport Undertakings under tender for e-bus supply order bus order quan ty were though, later, under the FAME
FAME-II; Out of this, 5095 (80) which reached the procured through outright 2 scheme, this opera on
electric buses to 64 state/ City contract awarding stage, purchase mode/ capex mode. model became a mandate for
Transport Undertaking for followed by HRTC (75). Tata availing central subsidy. A total
intracity transport, 400 electric motors bagged the largest U ar Pradesh published RfP of 5595 e-buses were allocated
buses for inter-city opera on supply order (215) under FAME with the largest e-bus order across India in the phase-I of
and 100 electric buses for last 1, followed by Olectra-BYD under FAME 2, ordering up to FAME 2. Out of this, tenders for
mile connec vity to Delhi (115). 600 buses across 11 ci es. 4520 buses were issued of
Metro Rail Corpora on PMI-Foton bagged the en re which, about 2450 buses had
(DMRC) were allocated. To Tradi onally, public buses order of 600 buses. Following been approved by DHI for
support the total approved were operated by staffs UP in the e-bus procurement FAME 2 subsidy by the end of
buses, government incen ve FY2020.
of about Rs. 2800 crores would
be extended.
TENDER ANALYSIS
FAME–I
On October 31, 2017, the DHI
issued an EoI invi ng proposals
from million-plus ci es and
special category states for
mul -modal electric public
transport. 47 proposals were
submi ed by 44 ci es. 11 out
of these 44 ci es were selected
for the project. But, only 8
ci es finalised the tendering
process before 31 March 2018
(Delhi retracted from floa ng
the tender as it had opted to
procure e-buses separately
from state budget, whereas,
Ahmedabad and Jaipur had
floated tenders but did not
complete the process).
Subsequently, many more
tenders were floated by
various transport authori es
during the FAME 1 period.
Some of these tenders were
terminated by the transport
authori es primarily due to
36 F A D A Journal November 2020 | fada.in
Surveys & Studies
Amongst all the FAME 2 Under the purview of FAME-2, bus sales, during the FAME 2 affinity (post COVID-induced
tenders that have been assuming that 7090 e-buses period (FY2020 to Fy2022), is lockdown) for electrifica on of
sanc oned which includes a would be procured between expected to grow at a CAGR of mobility.
total of 2450 buses across 13 FY2020 and FY2022 and 178%. This high growth rate
states, the average least cost considering the number of can be an cipated on the CHARGING INFRASTRUCTURE
(L1) per km quoted was Rs. FAME-2 sanc oned-buses so grounds of an ever-growing
63.3 per km for 9 metre buses far, FY20-21 is es mated to central government impetus Charging technology
and Rs. 69 per km for 12m witness sales of 1850 units. E- as well as stronger consumer
buses. On the basis of charging
technology used, charging
The L1 prices quoted for
tenders under FAME 2 are
dis nctly higher than the L1
prices quoted during the FAME
1 period. The reasons for this
increase in bid prices under the
second phase of FAME scheme
are the risk premium adjusted
with regards to the tender
details and payment security
risks associated with STUs.
If addi onal costs such as cost
of development of ancillary
infrastructure like depots,
administra ve expenses,
contract management etc. are
also included, the actual rate
per km would be much higher
than the L1 quotes.
MARKET SIZE
Clenching 400 unit mark, FY19
saw an increment of 369 e-
buses in sales over that of
FY18. Sale of e-buses increased
Y-o-Y by 50% in FY20 to reach
600 units. This rise in e-bus
sales in the last two fiscals can
be a ributed to aggressive
governmental push through
FAME scheme (including state-
wise e-bus alloca ons).
The highest number of e-buses
deployed in a state under
FAME 1 as on 16th April 2020 is
80 in West Bengal, which is
closely followed by
Maharashtra (70). Out of the
total 400 buses deployed
under FAME 1 in the country,
the majority of 215 buses have
been supplied by Tata motors,
covering 5 out of 8 states.
fada.in | November 2020 F A D A Journal 37
Surveys & Studies
infrastructure can be broadly Ba ery swapping method of allo ed spaces as these depots market growth on the back of
classified into three types: charging for e-buses is in were not planned to dock e- proper regulatory framework
conduc ve charging, induc ve limited deployments. The first buses or facilitate charging and market mechanism. Going
charging & ba ery swapping. and the only such case in India service. Thus, it is highly forward, many private players
was introduced by Ashok important to plan and develop are also expected to foray into
Conduc ve charging type is Leyland-Sun Mobility smart bus depots with efficient various businesses in the e-bus
the predominant technology partnership for Ahmedabad depot management system market such as e-bus
deployed for charging BRTS. Though ordinary e-buses that can manage mul ple components, passenger
infrastructure due to its design have a range of 200-300 kms, conven onal and electric services, etc. Many central
simplicity and lower these buses with swappable buses op mally. ini a ves (for ex: lower GST
infrastructural expenses in ba eries only have 40 kms of rates, FAME scheme) and EV
comparison with the other two range but the swapping takes Low power supply connec on policy incen ves of several
forms of technology. less than 4 minutes, making it states (Eg: Road tax or permit
Conduc ve charging can be suitable for intra-city transport. Closely linked to the depot fee concessions,
further classified into AC design dilemma is the manufacturing incen ves)
charging and DC charging. Challenges challenge of limited capacity have been able to streamline
of power connec on to different processes such as e-
Reportedly, there is no case of Lack of clarity in stakeholders’ exis ng depots or bus stops to bus financing & procurement
AC-1 and AC-2 charging roles cater to e-bus charging and also promote crea on of
technology for e-buses requirements. The slow and en re e-bus value chain within
worldwide. These two types One of the cri cal challenges fast chargers typically provide these States.
have service voltage levels of hampering the growth of e-bus 50 kW and 150 kW service
120V and 230V respec vely, charging infrastructure in India power respec vely. So, in Though the aforemen oned
which, in the Indian context, is the lack of clarity in the role order to facilitate aspects around e-bus are
cannot be used for charging of and extent of responsibili es uninterrupted charging being implemented in
e-buses. AC-3 type charging assigned to the state or city service, the bus terminal or accordance with set
u lizes 3-phase AC voltage transport authority and bus depot must have about 1 MW governmental guidelines,
level i.e. 415V. AC-3 charging operators with regard to or more capacity electricity there is an incumbent
requires e-buses to have on- se ng up of charging sta ons connec on. challenge of se ng up and
board chargers. Employing this under the GCC model. managing e-bus charging infra
charging technology for e-bus CONCLUSION in terms of planning, scope of
charging is more economical Depot infra planning & stakeholders’ responsibili es,
but the charging me is management With strong government opera on, etc. that must be
considerably longer than DC thrust for EV transi on, the addressed and resolved on
charging DC plug-in also A vast majority of city bus public transport authori es high priority in order to fast-
involves service voltage level depots across all states face and the e-bus suppliers are track the e-bus ecosystem
of 415V and unlike AC-3, DC hindrances in accomoda ng encouraged to drive the development in India.
plug-in does not require e- charging systems in their
buses to have on-board E-bus market has the poten al
chargers. Charging me can be to fill the voids that exist in the
as low as half an hour for full Indian public transport system.
charging. By reducing expenses related
to O&M and also cu ng down
Induc ve charging technology hidden costs linked to public
is basically any wireless health and environment, mass
charging method. The required electrifica on of public buses
service voltage level in India for would not only let the
induc ve charging is 415V or concerned stakeholders reap
above. This kind of charge huge benefits but also help
transfer technology has very strike a balance of “providing
limited applica on all across returns” between the service
the world because its highly providers and the service users
expensive & its infrastructure over the long run.
is quite complex.
38 F A D A Journal November 2020 | fada.in
Competition Law
Competition Law Updates
G R Bhatia comprising cars and light vans, concerned par es, which bargaining by Honda dealers
par cularly charging in a range share upstream and
Partner & Head of different se ngs including downstream business links, On 21.08.2016, the Na onal
Competition Law Practice Group home and off-street parking; have less than 25% shares in Honda Dealer Council (NHDC)
Luthra & Luthra Law Office on-street parking; workplace; the relevant market. The SAMR on behalf of itself and a group
hub and des na on; and en- has sought public comments of Honda Australia dealers
UK Compe on and route charging. on the proposed merger. approached the Australian
Markets Authority Compe on and Consumer
launches study into electric BAIC Rocar’s acquisi on of Supreme Court to adjudicate Commission (ACCC) seeking
vehicle charging sector Shanxi auto sales firm under on allega ons of resale price authorisa on to discuss and
review by Chinese an trust maintenance (RPM) against collec vely nego ate with
On 02.12.2020, the UK CMA authority Hyundai Honda Australia issues arising
announced a market study into from Honda Australia's
the electric vehicle charging China’s State Administra on Vide order dated 14.06.2017, termina on of exis ng dealer
sector, with an aim to achieve for Market Regula on (SAMR) the Compe on Commission agreements and their
development of the sector in a is reviewing the proposed of India (CCI), a er a detailed replacement with a new
compe ve manner while acquisi on of Shanxi analysis of the findings arrived agency model. These
a rac ng private investment Penglongzhixing Automobile at by the Director General (DG) discussions have been
to help the sector grow, Sales Services (Target) by in the inves ga on report had specified to include terms and
reaffirm confidence of people Beijing BAIC Rocar Automobile held that Hyundai Motor India informa on including in
using electric vehicles in their Services & Trade (BAIC Rocar). Ltd. had imposed ver cal rela on to commissions,
country and address concerns restraints of RPM and tying-in, compensa on for termina on
such as not being able to BAIC Rocar, controlled by the in viola on of Sec on 3(4)(e) of exis ng arrangements and
recharge while driving, etc. BAIC Group, is engaged in the [Resale Price Maintenance] arrangements for finance,
provision of sales and relevant and Sec on 3(4)(a) [ e-in insurance, oil, a ermarket
The CMA observed that while services for Mercedes-Benz, arrangements] of the products and accessories.
this sector is s ll in the nascent Beijing Hyundai, and other Compe on Act, 2002 (Act).
stage, it is growing rapidly as branded vehicles. The Target is CCI also imposed a penalty of While interim authorisa on
can be inferred from the an authorized distributor of 87 crores on Hyundai. was granted to the NHDC in
increase in number of charge- Mercedes-Benz vehicles. The September 2020 to share
points over the past decade, relevant markets iden fied by The NCLAT, by way of its order informa on and commence
from 1,500 in 2011 to 20,000 in the SAMR are (i) the market for dated 19.09.2018, set aside collec ve bargaining with
2020. The study will focus on the sale of luxury-brand the order of the CCI, primarily Honda Australia, the ACCC on
the supply of charge-points for passenger vehicles at 4S stores on technical grounds of alleged 02.12.2020 has granted
plug-in hybrid and all-electric in Taiyuan city, in which BAIC non-apprecia on of evidence authorisa on for the same ll
‘passenger’ electric vehicles, Rocar has a share of 0%-5% independently by the CCI and 31.07.2026 taking into account
and the Target has a share of relying completely on the factors such as:
5%-10%; and (ii) Chinese findings given in the DG's
market for the supply of inves ga on report. The CCI (i) transac on cost savings;
luxury-brand passenger appealed the said decision of
vehicles, in which Mercedes- the NCLAT, which is currently (ii) reduc on of informa on
Benz has a share of 20%-25%. pending before the SC for final asymmetry;
disposal and is likely to be
The merger is currently under listed on 12.01.2021. (iii) i m p r o v e d i n p u t i n t o
review as a simple case, as the contracts, and
combined share of the par es Australian Compe on and
in the common relevant Consumer Commission (iv) increased compe on for
market is less than 15% and the authorises collec ve the supply of Honda
products.
fada.in | November 2020 F A D A Journal 39
Technology
Blockchain in the Automotive Industry:
A Soon-to-be Multibillion Dollar Business
Is using blockchain techno- a way for informa on to be Apart from bitcoin billion euros by 2030.
logy in the automo ve documented, shared, and transac ons, how can However, this won’t happen
sector profitable? According to managed by a community, not companies implement this through increased opera onal
a study by Simon-Kucher & a central authority. The blocks technology in a profitable efficiency alone; new high-
Partners, car OEMs could contain digitally stored way? Many companies in the value-adding solu ons for
benefit from market poten al informa on, including automo ve sector already customers are needed.
of over 100 billion euros. transac on data (e.g. date, recognize blockchain’s
However, in order to achieve poten al to improve business Communica ve cars
this, they need to develop me, amount of purchase), processes. However, deriving
applica ons to offer customers details about the par cipants added value for their What shape could solu ons
specific mobility, communica on, (e.g. buyers, sellers), and a customers and mone zing this take? Possible applica ons
and security solu ons. code that makes each block value aren’t yet priori es. include a smart traffic-jam
unique. avoidance system. Here,
Blockchain is an important Not making this a focus is a informa on about street
topic that quickly arises in any Chains of blocks are encrypted missed opportunity because conges on would be shared
conversa on about industrial on the computer of each many companies stand to via networked cars and car-to-
digitaliza on. What is the idea transac on par cipant. Every generate significant profit. A car communica on. Users
behind this technology? It is transac on must be verified by recent study by Simon-Kucher would then pay a fee to drive
essen ally a publicly all par cipants, providing full & Partners predicts that on traffic-free roads and these
accessible, decentralized, transparency between blockchain based applica ons transac ons would be
distributed ledger with a everyone involved due to in the global automo ve processed via blockchain
constantly growing set of distributed networking. sector will reach an annual technology. More than a
transac on records referred to mone za on poten al of 104 quarter of the study’s
as blocks. Blockchain provides New services rather than par cipants reported they
more efficient processes
40 F A D A Journal November 2020 | fada.in
Technology
would be willing to pay ten Most importantly, safety plays at almost ten euros per month how and external advice is
euros per month on average a key role in possible by par cipants. required. As the study shows,
for this kind of service. blockchain applica ons in the the applica ons par cipants
automo ve industry. Study Increased customer value are primarily interested in
Furthermore, 17% of survey par cipants would be willing through coopera on require the collabora on of
par cipants would spend just to pay five euros per month for numerous players from within
under six euros per month on a solu on that provided Customers are definitely the supply chain as well as
average for a solu on that poten al buyers full prepared to pay for blockchain outside the automo ve
allowed their car to make real- transparency over used solu ons in the automo ve industry. For example,
vehicles' mileage and history industry. Their willingness to connected cars build upon
me payments autonomously reports. pay is reflected in the study. exis ng telecommunica ons
at parking meters or toll Now, it is up to automo ve infrastructure. While the
sta ons. However, regional Blockchain apps for remotely manufacturers to iden fy and various providers and
preferences were clear. Study locking and unlocking car implement suitable business operators, such as parking
par cipants from South doors that are six mes faster models. Only then will they be meters, toll booths, and taxi
America were significantly and safer than the compe on able to unlock the enormous companies, must also be
more interested in this were valued at over seven mone za on poten al of this brought on board. Therefore,
payment service than drivers euros per month. Guaranteed database technology and coopera on and a shared
from North America, Europe, vehicle data protec on – for profit from it. vision are key to unlocking
or the Asia-Pacific region. example, against cybera acks blockchain’s full poten al in
– is a solu on that was valued For this to happen, a the automo ve sector.
Added safety through considerable amount of know-
blockchain security
fada.in | November 2020 F A D A Journal 41
Perspective
AI in Automotives: The Future is Now!
Advancements in ar ficial vehicles including cars, taxis, speed, and is making a great autonomous mode hit a
intelligence (AI) have trucks, buses and bikes rolling impact on automakers, woman and killed her. This was
contributed to the growth of out on highways, on the streets vehicle owners and service the first major accident where
the automo ve industry and on rural roads. This could providers in mul ple ways. a self-driving car killed a
through the crea on and become a reality with AI a few Many big players in the human being. Tes ng was
evolu on of such self-driving years from now. automo ve industry are temporarily put on hold for a
vehicles as cars, taxis, trucks, striving to automate their few months, but it resumed
buses and bikes. Once Riding a self-driving car with cars with AI-based again the same year.
driverless technology is fully much an cipa on would be an technology. Many firms are
developed, traffic collisions exci ng and thrilling also developing technology In December 2018, Waymo
and accidents caused by experience for most of us. that can help with the became the first company to
human error, aggressive Everything in a driverless or installa on of self-sufficient commercialise a fully-
driving and other self-driving car would seem automobiles. autonomous taxi service in the
inconveniences will be magical when the steering US.
substan ally reduced. wheel turns by itself, or the car Self-driving cars
automa cally stops at a traffic A number of components
Flying cars are no longer a light. This ar cle will delve into Japan’s Tsukuba Mechanical contribute to the func oning
fantasy or science fic on! With AI trends driving the Engineering Laboratory of self-driving cars. These cars
AI, autonomous, or self- automo ve industry, including developed the first self-driving are built with complex systems
driving, cars and autonomous self-driving cars and driver- car in 1977. Since then, many such as braking, lane changing,
flying cars are no more a assistance technologies. companies have come up with collision preven on,
futuris c dream. Companies their versions of self-driving naviga on and mapping,
like Boeing and Terrafugia have Ar ficial intelligence cars. Use of public roads for which are controlled and
already developed fully- tes ng self-driving cars has monitored by high-
autonomous flying cars. With AI, as we all know, revolves been legalised and permi ed performance computers or
the emergence of AI, we can around the use of algorithms in many ci es in the US, Europe intelligent systems.
see many transforma ons in or computer programs. and Asia.
automo ve and avia on Modern AI techniques are One such intelligent system is
industries. Although pervasive and numerous, In 2016, Uber began tes ng RT-RK computer system based
autonomous flying cars are not therefore only a few AI self-driving cars on the streets on TI processors. RT-RK Alpha
yet available in the market, technologies relevant to the in San Francisco, USA. In March development board is used for
self-driving cars are ready for automo ve industry will be 2018, one of its self-driving advanced warning systems,
commercial sale. Now, imagine covered in this ar cle. cars—a modified Volvo ac ve control systems and
our world with self-driving XC90—that was speeding at semi-autonomous vehicle
AI is advancing at a great about 64.4kmph (40mph) in applica ons.
42 F A D A Journal November 2020 | fada.in
Perspective
Mapping is one of the most vehicle, find nearby informed decisions based on Cogni ve technology
important func ons in these restaurants and buy household what it has learned. Big Data,
vehicles. It handles pre- items from relevant stores. machine learning and AI Pa ern iden fica on, natural
programmed data on Applica ons of AI-cloud generate highly sensi ve language interpreta on,
approxima ons of streetlights, pla orms ensure that data is autonomous systems to ability to build knowledge and
obstruc ons and surroundings available when needed. support the movement of cogni ve analy cs make sense
of the areas being driven in and vehicles. of informa on. Cogni ve
around. It also handles the The Internet of Things compu ng can handle
safety of passengers during Deep learning conceptual/symbolic data
high-risk situa ons like head- There are many sensors rather than just pure data.
on collisions with pedestrians. connected to the Internet This is the process for Cogni ve systems work like a
AI algorithms help perform every day, from weather to achieving machine learning. It human and can interpret a
various func ons by healthcare to smartphones. is based on an ar ficial neural real-life situa on with
processing and analysing input The combina on of AI and the network that can learn and unstructured data, making
data, such as sounds and Internet of Things (IoT) devices make intelligent decisions on high-level decisions in complex
images from various sensors. allow manufacturers to update its own. Deep learning situa ons. Car manufacturers
vehicles with addi onal methods make a lot of sense have now started
Some technologies used in AI features such as predic ve with large data sets as incorpora ng this technology
are described below. maintenance, repair compared to machine into their vehicles. This is
scheduling, iden fica on of learning. because self-driving involves
Cloud compu ng performance issues, medical more than following a set of
emergencies and automa c Deep learning helps in rules or algorithms—it also
This is an ideal pla orm for toll collec on. advanced driving assistance involves learning.
staging and deploying AI systems, and in enhancing the
technology in automo ve Machine learning quality and characteris cs of AI does more than respond to
applica ons. It includes autonomous vehicles. Bosch is what is happening in the
analy cs, Big Data access and Machine learning, when in the process of developing vehicle’s vicinity. Powerful
centralised connec vity. applied to devices and supercomputers for vehicles. deep learning algorithms can
Cloud-based AI pla orms help machines, can think and act Whereas, Nvidia is working to accurately predict what
drivers pay for their fuel almost like human beings develop deep learning objects in the vehicle’s path
purchases from inside the using past data. It can make technology to power them.
fada.in | November 2020 F A D A Journal 43
Perspective
are likely to do. AI constantly can check engine lights, oil of the heads-up display (HUD) Automated guided vehicles are
learns and adjusts the rules to lights and low-ba ery according to where the driver’s being used to move materials
navigate the road. The result is indicators, and detect eyes are focused. around automo ve plants
a virtual neural network of self- problems before these affect without human interven on.
driving vehicles that learn as vehicle opera on. By Upper-body detec on AI enables these delivery
they go. monitoring thousands of vehicles to iden fy objects in
sensors, AI can spot minute It detects the driver’s posture. their paths and to adjust their
Infotainment systems changes & component failures. Air bags can be deployed route, accordingly.
based on posture at the me of
In-vehicle infotainment AI can iden fy dangerous crash, reducing injuries. Pain ng and welding robots,
provides a combina on of situa ons and alert the driver, when powered by AI, can do
informa on & entertainment or take emergency control of AI automo ve insurance more than follow a pre-
in the form of audio and video the vehicle, to avoid an programmed rou ne. AI
content, games, social accident. Emergency braking, The insurance industry empowers them to iden fy
networking, etc. Infotainment cross-traffic detec on, blind supports the use of AI in cars to defects or irregulari es in
is a part of the technological spot monitoring and driver- help make risk assessments in materials and alert quality
interface of any modern car. AI assist steering can help avoid real me. AI speeds up the control personnel.
improves infotainment accidents, and save lives in the process of filing claims when
systems in a be er way. process. a c c i d e nt s d o o c c u r. A nt The way forward
Informa on related to driver Financial has released its AI-
assistance, naviga on, access eyeSight uses AI and deep powered video app in the AI has captured maximum
to phone calls, messaging and learning to offer a plethora of Chinese auto market. The app a en on in automo ve
the like is delivered seamlessly in-car automo ve solu ons. enables drivers to perform applica ons, par cularly in
to the driver through Using advanced me-of-flight their own auto damage driverless cars. This
infotainment systems. cameras and IR sensors, assessment for their respec ve technology has brought a new
eyeSight’s AI so ware can insurance companies. breed of car driving. Huge
Features like eye tracking, detect many important key computa onal needs in
speech recogni on, gesture areas like facial recogni on, On-screen instruc ons guide driverless cars have taken AI to
recogni on, monitoring eye tracking, upper-body users to record video of their a completely different level.
driving and a database of detec on and so on. vehicle damage for insurance Advancements in AI have
natural languages are included claim. AI quickly informs the contributed to the growth of
in AI systems. Moreover, with Facial recogni on drivers how to have their the automo ve industry
AI’s connec on to Big Data, vehicle repaired, and what will through the crea on and
infotainment systems can be These algorithms detect which be covered by insurance. evolu on of such self-driving
used to suggest products and driver is opera ng the vehicle. vehicles as cars, taxis, trucks,
services to drivers. A husband, wife or a young AI in automobile manufacturing buses and bikes.
adult can have his or her own
Israeli automo ve computer preferences. The system can AI is changing what vehicles Once driverless technology is
vision startup eyeSight has automa cally adjust the seat, can do and how these are built. fully developed, traffic
developed a program that mirrors and temperature to Assembly-line robots are collisions and accidents caused
recognises simple hand suit the individual. nothing new. But now, AI- by human error, aggressive
gestures to control the powered smart robots can driving & other inconveniences
infotainment system without Eye tracking work with their human will reduce substan ally. AI not
taking its eyes off the road. counterparts. Collabora ve only enables autonomous
On observing eye gaze, eye robots use AI to sense what driving and ensures safety of
AI driver assistance openness and head posi on, human workers are doing, and human drivers, it also helps in
eyeSight can detect distracted theyadjusttheirmo onstoavoid the manufacturing of vehicles.
AI can do more than driving and alert the driver to injuringhumanco-workers. AI is already making drama c
autonomous driving, that is for keep the eyes on the road. changes in the automobile
sure! It keeps an eye on the Drowsiness is detected by eye Many OEMs have started industry, including the way we
human driver and ensures safe openness and head posi on, developing wearable industrial drive and the way we interact
driving. AI so ware detects allowing the system to wake robots for assembly lines. with connected devices. The
whether or not the driver is in the driver up, if necessary. Wearable robots help protect world of automo ve industry
the vehicle. AI monitors workers’ knees, back and neck, with AI is going towards a new
various sensors installed in the Contextual control while giving them the mobility transforma on, in a big way.
vehicle. A connected vehicle and strength to perform
The system tailors the content tenuous jobs.
44 F A D A Journal November 2020 | fada.in
Membership
WE WELCOME OUR NEW
MEMBERS
No. Dealer Principal Name Dealership Name City State Franchise
Hero MotoCorp
1 Mr Shaik Omer Shariff Shariff Motors Kurnool Andhra Pradesh Tata Motors (CVD)
Tata Motors (PCD)
2 Mr L Bhanu Prasad Sri Ranga Motors Pvt Ltd Vizianagaram Andhra Pradesh Tata Motors (PCD)
Renault India
3 Mr M.V.M Ravinder Siva Sankar Motors Pvt Ltd Visakhapatnam Andhra Pradesh Mahindra&Mahindra
Bajaj Auto
4 Mr B Rajesh Chi babu Tristar Auto Agencies Vizag Pvt Ltd Visakhapatnam Andhra Pradesh HMSI
Renault India
5 Mr Pradip Rajkhowa T I Automo ves Pvt Ltd Guwaha Assam TVS Motor
Ford India
6 Mr Maneet Singh Harbir Automobile Pvt Ltd Chandigarh Chandigarh Hero MotoCorp
HMSI
7 Mr Durga Prasad Agrawal Jindal Automobiles Raigarh Chha sgarh Hyundai
Hyundai
8 Mr Kulwant Singh Bha a Yashpal Automobiles Pvt Ltd Rajnandgaon Chha sgarh Ashok Leyland
Audi India
9 Mr Aditya Vikram Agarwalla Prime Auto Cars Ltd New Delhi Delhi Hero MotoCorp
HMSI
10 Mr Suneet Arora MCR Enterprises Delhi Delhi Honda Cars
Hyundai
11 Mr Akshit Pobaru Govardhan Cars Pvt Ltd Jamnagar Gujarat Hyundai
Renault India
12 Ms Neetaben Rajendra Seth Shradha Motors Ahmedabad Gujarat Royal Enfield
Skoda Auto
13 Mr Kaushik Shah Universal Auto Products Ahmedabad Gujarat Suzuki Motorcycles
14 Mr Radhasaran S Patel Down Town Motors Pvt Ltd Vadodara Gujarat
15 Mr Shailendra Bohra Bohra Vehicles Pvt Ltd Faridabad Haryana
16 Mr Akkshay Nagpal Pal Sales & Service Pvt Ltd Jammu Jammu Kashmir
17 Mr Anil Puri Crest Auto Wheels Pvt Ltd Jammu Jammu Kashmir
18 Mr Taranjit Singh Sahni Devika Automobiles Jammu Jammu Kashmir
19 Mr Akshay Mahajan Diamond Scooters & Bikes Pvt Ltd Jammu Jammu Kashmir
20 Mr Ravish Trehan Trehan Automo ve Pvt Ltd Jammu Jammu Kashmir
21 Mr Sahil Mahajan Pace Autoaids Pvt Ltd Jammu Jammu Kashmir
22 Mr Sanjay Mahajan Jammu Automart Pvt Ltd Jammu Jammu Kashmir
23 Mr Pranav Mehta Jammu Autowheels Pvt Ltd Jammu Jammu Kashmir
24 Mr Vikas Rathore Reliance Motors Jammu Jammu Kashmir
25 Mr Atul Abrol Wheelocity Motors Pvt Ltd Jammu Jammu Kashmir
26 Mr Pankaj Sharma Bikemart Pvt Ltd Jammu Jammu Kashmir
46 F A D A Journal November 2020 | fada.in
Membership
No. Dealer Principal Name Dealership Name City State Franchise
27 Mr Ankur Mahajan Smam Automart Pvt Ltd Jammu Jammu Kashmir Tata Motors (PCD)
28 Mr Manik Batra JAY KAY Automobiles Jammu Jammu Kashmir TVS Motor
29 Mr Rohit Khatuwala Mi al Enterprises Koderma Jharkhand Hero MotoCorp
30 Mr Vineet Kumar Gutgu a Ramkrishna Traders Jamtara Jharkhand Hero MotoCorp
31 Mr Ashok Kumar Agarwal Moonka Automobiles Jamshedpur Jharkhand HMSI
32 Mr Vijay Kumar Mewar Shivam Bikes Ramgarh Can Jharkhand India Yamaha
33 Mr Vijay Kanoria Balajee Industries Pvt Ltd Dhanbad Jharkhand Piaggio Vehicles
34 Mr Animesh Sanwaria Absolute Auto Pvt Ltd Dhanbad Jharkhand Renault India
35 Mr Nakul Tiwary Maa Kalyani Automobiles Jamshedpur Jharkhand Suzuki Motorcycles
36 Mr Harsha Pa l Patson Motors Pvt Ltd Belagavi Karnataka Ford India
37 Mr Gopinath Muppiri Motonova Mobility Pvt Ltd Bengaluru Karnataka HMSI
38 Mr Chandrashekar C Apple Auto Pvt Ltd Bengaluru Karnataka Volkswagen Cars
39 Mr Abdul Basheer K M Zain Motors Kasaragod Kerala Bajaj Auto
40 Mr Sibi Melvin Sleeba Sleeba & Sons Automo ve Pvt Ltd Thiruvananthapuram Kerala Mahindra&Mahindra
41 Mr Nihas K M AM Motors Malappuram Kerala Maru Suzuki
42 Mr Anuj Vohra VN Motors Indore Madhya Pradesh Hero MotoCorp
43 Mr Shashikant Dhamdhere Dhanlaxmi Automobiles Aurangabad Maharashtra Hero MotoCorp
44 Mr Manoj Haridas Suchak H M Motors Panvel Maharashtra Hero MotoCorp
45 Mr Ya Sushil Gujarathi Ganesh Agencies Niphad Maharashtra HMSI
46 Mr Vijay A Singh VRB Automobiles Mumbai Maharashtra India Yamaha
47 Mr Hemendra Arya Lion Motors Dungarpur Rajasthan Bajaj 3W
48 Mr Shalabh Mehta Crossland Cars Pvt Ltd Jaipur Rajasthan Hyundai
49 Mr Vishal Kumar Rinaya Motors Chennai Tamil Nadu BGAUSS E2W
50 Mr T.R.S Babu Jayavilas Motors Madurai Tamil Nadu Hero MotoCorp
51 Mr R Sivakumar Suguna Automobiles Coimbatore Tamil Nadu Hero MotoCorp
52 Mr Suseen R Susee Cars and Trucks Pvt Ltd Madurai Tamil Nadu Hyundai
53 Mr S S Shiva LRN Auto Agencies Pvt Ltd Salem Tamil Nadu Hyundai
54 Mr K Senthil Kumar Shri Amman Cars India Pvt Ltd Hosur Tamil Nadu Maru Suzuki
55 Mr B Rajkumar Athirst Auto Pvt Ltd Tirunelveli Tamil Nadu Tata Motors (PCD)
56 Ms Nazerath Charles Kumaran Automobiles Pvt Ltd Nagercoil Tamil Nadu Tata Motors (PCD)
57 Mr Manish Gupta Shree Tirupa Motors Kanpur U ar Pradesh Hero MotoCorp
58 Mr Shak Vardhan Sansaar Ventures Pvt Ltd Haridwar U arakhand HMSI
59 Mr Priyank Janee Janee Motors Pvt Ltd Asansol West Bengal HMSI
60 Mr Arindam Das Arisha Motors Siliguri West Bengal TVS Motor
fada.in | November 2020 F A D A Journal 47
Automotive Insight
Will Consumers Finally Be Able to Buy
New Cars Online?
- Boston Consulting Group
COVID-19 has prompted financing tools needed to Just a 1% reduc on in incen ve as books to bulky, big- cket
many people to assess launch digital sales. spending would add $650 goods, including consumer
whether they should return to million to the bo om line of durables like technology-rich
using public transit or consider The companies and brands automakers. appliances. It is only a ma er
driving instead. According to that move fastest could gain a of me before online car
BCG research, 8% of European compe ve advantage, GROWTH POTENTIAL purchases become just as
consumers say they are more improving market share and common.
likely to buy a car because of profit margins by culling digital Sales of other durable goods
the pandemic. That number is data that can be used to create demonstrate how changing The auto industry is unlike
16% in the US and 60% in targeted offers and reduce consumer preferences will furniture and appliances,
China. incen ve spending. The payoff push car buying online. (See however, in the significant
will be big. Incen ves Exhibit 1.) About two decades differences between two
Will these sen ments accounted for 11.1% of ago, e-commerce had barely product segments: new and
translate into a global wave of average US new-vehicle penetrated the furniture and used cars. Used cars are ahead
new vehicle purchases? That transac on prices in 2019, or appliance industries. But over of new cars in the transi on to
will depend, in part, on about $65 billion, according to the years, consumers easily online sales, largely because
whether poten al buyers can auto price informa on transi oned from the online they don’t require
overcome their reluctance to company Kelley Blue Book. purchase of small items such coordina on between
v i s i t a ca r d e a l e r. M a ny
consumers remain wary of
engaging in face-to-face
nego a ons, providing paper
signatures, and a ending
finance office mee ngs, all of
which are typically part of the
vehicle purchasing process.
E-commerce can address these
concerns, but very few cars are
currently bought online.
Indeed, autos represent one of
the last bas ons of almost
exclusively physical sales. Most
consumers prefer to see,
touch, and drive a car before
buying. Automakers and
dealers therefore need to step
up their collabora on in order
to provide the contactless test
drives and online pricing and
48 F A D A Journal November 2020 | fada.in
Automotive Insight
franchised dealers and faster in Europe because a most effect, which op ons and automakers and dealers will
automakers. Used cars also larger por on of its new-car trim levels have the largest ul mately be able to be er
don't have the same high market is built to order. uptake, and at what point target consumer preferences,
deprecia on challenge as new Addi onally, dealer franchise consumers are most likely to hone vehicle configura ons,
vehicles. That facilitates online laws are rela vely weaker than bounce to rival brands. Such and reduce the need for
sales by allowing for marke ng in the US, giving the industry data can be used to fine-tune discounts and sales incen ves.
ini a ves such as a seven-day more flexibility. China should everything from what gets
return policy. Used-car see the fastest adop on, with produced on the factory floor THE DIGITAL SALES VISION
retailers can offer that benefit digital sales reaching as much to what arrives in the
without much risk of a large as 10% of new-vehicle sales by showroom. Online used-car players have
deprecia on hit, and it 2025 and 43% by 2035, in line made great strides toward
reassures online buyers. with Chinese consumers’ Moving sales online for a digital sales, but the
Online-only used-vehicle already high usage of e- growing number of vehicles opportunity is even greater in
dealers like Carvana and commerce channels. Changes will require be er the new-car market. Under a
Vroom are leading this in US franchise laws to allow collabora on between true digital sales model,
transi on. In the new-car automakers to sell directly to automakers and dealers. It consumers conduct their
segment, Tesla’s use of e- consumers would accelerate could also create tension research online and have the
commerce and pilot programs adop on of digital sales. around the points in the tools they need to easily
from other automakers process where customers are compare the pricing and
present a promising picture of The shi to online sales handed from an OEM to a characteris cs of vehicles
the digital sales channel’s presents an opportunity for dealer and about who controls within a brand. Shopping
poten al. automakers and dealers to the customer data that each might start with a search in a
gather more data and develop sale generates. Will broad category, such as three-
BCG projects that online a be er understanding of automakers require a row SUVs. A er deciding on a
transac ons extending to consumer behaviors. That data standardized system across all model, the customer selects
billing and payment could can be used to break down of their brand dealers? Who the vehicle and searches
account for about 5% to 7% of silos both within auto will be responsible for through the dealer’s inventory.
new-vehicles sales in the US by manufacturing companies and communica ng the process? The sales portal then
2025 and for as much as 33% between brands and dealers. Who will build the digital sales seamlessly carries the buyer
by 2035. (See Exhibit 2.) That By tracking the customer’s pla orm and maintain it? Who through vehicle selec on to
represents significant growth, journey through the will set prices? Which financing to delivery.
as less than 1% of these sales purchasing process, customers will be eligible for
are conducted online today. automakers will be able to returns and who will manage The rapid growth of online-
Digital shopping for cars is learn what types of incen ves them? By working together to only used-car dealers in the
expected to grow slightly and sales promo ons have the sort out their respec ve roles, past several years validates
consumers’ willingness to buy
cars online. Carvana saw more
than 100% year-over-year
growth in vehicles sold from
2014 to 2018, and both
Carvana and Vroom saw 89%
growth in units sold between
2018 and 2019. These
companies pioneered the use
of online trade-ins as an
important part of the car-
buying process, and that has
helped fuel their growth.
In addi on to sa sfying
consumers’ interest in online
buying, sellers of new cars
have the opportunity to gather
customer data such as model
fada.in | November 2020 F A D A Journal 49
Automotive Insight
preferences, loca on, and networks, and digital benefit of online shopping is prac ces are now almost
purchasing criteria in order to capabili es vary accordingly. the ease of comparing prices. commonplace, with dealers
drive digital marke ng and Moreover, dealers and This price transparency could offering programs that include
inform product volume automakers focus on different put further pressure on convenient and contactless
forecas ng. They will be able parts of the business. transac on prices and have a test drives, virtual showrooms
to fine-tune pricing of add-on Automakers want to sell new nega ve effect on industry or video-based car
packages consistent with vehicles, but dealers also sell profits. Dealer referral services walkarounds, and home
customers’ willingness to pay, used cars, service, parts, and and provide pricing delivery or contactless pickup.
even differen a ng by a er-market products. Only informa on that savvy
geography. This will help both through a collabora ve consumers can use to launch In addi on, automakers are
automakers and dealers approach, addressing both the nego a ons on the basis of an launching pilot programs for
decrease variable marke ng individual and the shared already discounted price. near-complete e-commerce
expenses. needs of automakers and offerings, which guide
dealers, can e-commerce But progressive OEMs and customers through the
OBSTACLES TO DIGITIZATION become a meaningful sales dealers can turn this poten al selec on process and then
ARE LONGSTANDING channel for new cars. challenge into an opportunity hand them off to a dealer to
by using data to devise complete the sale. Honda
Thus far, the industry ’s In most markets, automakers incen ves, op ons, or service launched its Shop Simple
organiza on and a patchwork are prohibited from compe ng plans likely to be a rac ve to ini a ve earlier this year,
of regula ons have stymied with their own dealers, but the specific individuals. Such a expanding from two ci es to a
the crea on of a cohesive rules around online sales are strategy can reduce price na onwide presence in a
digital purchase experience. somewhat unclear. The best elas city across mul ple ma er of weeks. The online
Automakers produce vehicles approach is a partnership product and service pla orm allows customers to
that they sell to dealers, which between automakers and categories. search the company’s
resell the vehicles to end dealers, with the digital inventory, filter for desired
customers—consumers and customer moving seamlessly COVID-19 IS ACCELERATING features, and obtain details
fleets. between the two. DIGITAL SALES about colours, trim levels,
packages, and op ons. It
Sales franchises range from There’s also the issue of profit Many car sellers are moving to provides a discounted internet
single family-owned stores to margin compression. One increase digital sales during price, calculates the value of
vast publicly traded dealership the pandemic. Infrequent
50 F A D A Journal November 2020 | fada.in
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