Business Daily from THE HINDU group of publications
Wednesday, Jun 21, 2006
Business Daily from THE HINDU group of publications Wednesday, Jun 21, 2006 |
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Industry & Economy
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Cars Marketing - Strategy Buyback scheme to push up Corolla sales K Giriprakash
Bangalore , June 20 Last time Toyota dealers gave away petrol worth Rs 1 lakh as an incentive to buy Innova and this time they are willing to buy back the Corolla if it helps to push up the sales. Claimed to be a first in the industry, the scheme is worked out in such a manner that the dealer guarantees a customer a buy back of Corolla at market price. Toyota claims that the gains are not just in expected higher sales. The scheme is also being used to test the waters on the company's move to enter the used car business. "We expect at least 20 per cent rise in sales because of this scheme. Perhaps it will also allow to find out whether we can get into the used car business," Toyota Kirloskar deputy managing director, Mr K.K. Swamy told Business Line. This is how the scheme works: For H1 variant of Corolla, a customer has to make a down payment of Rs 1.49 lakh and pay a monthly instalment of Rs 17,500 for 35 months. Without this scheme, the EMI will be as high as around Rs 29,000. At the end of the tenure, he will have to make another lumpsum payment of Rs 3.95 lakh. If he opts for the buy back scheme, the company will offer him the market value of the car, which according to market estimates, will be around Rs 6.75 lakh three years from now. The total cost of the Corolla make on road in Bangalore is about Rs 11.5 lakh. The new scheme comes at a time when Corolla, though being a leader in the C plus segment, has witnessed a drop in sales. But Toyota isn't worried yet. "We are not chasing numbers here. We are trying to make the car a lot more affordable," says Mr Swamy.
More Stories on : Cars | Strategy | Buyback
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