Even as it is celebrating the completion of the maiden year of BharatBenz trucks on the Indian roads, Daimler India Commercial Vehicles Pvt. Ltd. has frowned upon the rising trend of discounting in the industry.
Addressing a press conference at the Orgadam facility near here, Managing Director and Chief Executive Officer of the company Marc Llistosella regretted that the practice of discounting or subvention had assumed dramatic proportions of late.
Pointing out that ‘discounting’ had gone up to a whopping 40 per cent in some instances, he felt that this practice would bring no good to the industry. To a specific query, he said competitors were playing for short-term gain to get the sales numbers up.
'This is extremely risky,' he added. Huge discounts on bulk deals destroyed the book value for truck customers, he said. 'Poor resale value is jeopardising the industry more than the market conditions,' he felt.
He reiterated the company’s trust in the India story. Mr. Llistosella asserted that the 'long-term growth (of India) is given. There is no change in our position on this view,' he asserted. After many decades of hibernation, 'we are seeing awakening in the Indian markets,' he said. In a market where competition was getting fiercer by the day since the entry of new players, it was not just the initial pricing that mattered. 'What matters more is the whole concept,' he pointed out. To a question, he said the company 'is not interested' in entering the light commercial vehicle segment.
V. R. V. Sriprasad, Vice-President Marketing & Sales, After Sales, said there was much better appreciation among customers on the benefit of technology. The myth surrounding the efficiency of higher horse power vehicles had largely been demystified, he pointed out. He said the company had nine models across tonnages. It would launch three more by year-end, he added.
In the first year of commercial production, the company sold over 5,000 medium and heavy duty BharatBenz trucks.
The company has 52 dealers. This would go up to 75 by year-end. It now offers truck portfolio in the 6-49-tonne range across applications.
Having invested in one-go Rs.4,400 crore at the 400-acre Oragadam plant, the company has already begun export of trucks under the brand name FUSO to Asian and African markets. Export of FUSO to Zambia will be flagged off on Friday. The company at present covers 45 per cent of the Indian truck market with 50 per cent of its proposed product portfolio.