Clear all issues like ‘all taxes and charges’ before issuing the first cheque when buying a new vehicle
The difference between ‘ex-factory’ and ‘ex-showroom’ and ‘all taxes and charges’ and ‘landed cost to customer’ prices for a new motor vehicle are, often, huge. In some cases, depending on the size of the vehicle, size of engine, type of fuel used, state and city of registration, type of owner and more, the difference between ex-factory price and what it costs you when the new wheels land up at your address can be as much as 30% or 40%.
It is important, then, to ask for, and keep safely, not just a copy of the full invoice with break-ups but proof of the dealer and/or the manufacturer having paid all the taxes and charges claimed to have been paid. Many years ago, there was this case of leading car dealers in Pune (subsequently hushed up) not having actually paid the octroi on new cars and motorcycles; there was a major fear that owners would have to pay up, in due course.
The purchase process of a new vehicle, financed or fully-paid from own resources, becomes so complicated that a buyer ends up taking delivery satisfied with whatever pieces of paper land up his, or her, way. Try and curb this urgency and clear all these issues well in advance before issuing the first cheque.
Global Fuel Prices
Global prices of fuel are dropping rapidly. If prices in India at the filling stations also go down, recreational driving, which is already increasing, will rapidly go up further. The cost of ownership of an older vehicle is already quite low; so, the only cost is fuel and allied costs on the roads. This is why we now have traffic warnings for festivals. My only advice to people is: Make the best of relatively low prices, but not at the cost of safety. Just looking at the tyres and observing braking patterns on cars and bikes on the roads is becoming worrisome. People buy huge cars second-hand for a song but do not have the wherewithal to buy a new set of tyres. That's dangerous not just for them but for the rest of us. Have you checked the tyres of your wheels today?
Frenzy of Faith
There are more and more online insurance policies offering fascinating rates, on one side, versus manufacturer-provided direct to workshop insurance offers, on the other side. There is frenzy of phone calls, SMS messages, mailers and emails a couple of months before the renewal falls due. Getting a quote is the easier part.
What is the real insurance cover and what sort of fine print is hidden in the policy document is something else. Most of us will get a cover note and a receipt online and be expected to print and file it. Fair enough; it takes a few days to get a full insurance policy document, but that should not prevent you from getting a draft copy of the full insurance policy document online too.
Use the many incoming calls and messages to demand a draft copy of the insurance policy before making the payment and watch the fun! And check for exclusions as well as inclusions well before making the payment. For most of us, a ‘full comprehensive’ insurance policy including riots, floods, natural causes, strikes and more would do it, but one cannot keep researching more and more inclusions; so it is better to ask for and get a specific list of exclusions.
Location of overnight parking, age and profile of authorised drivers—employed as well as personal—voluntary deductibles, nil-depreciation and market value versus book value of the vehicle being insured are other factors you will need to look into.
(Veeresh Malik started and sold a couple of companies, is now back to his first love—writing. He is also involved in helping small and midsize family-run businesses re-invent themselves.)