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Second-hand cars, the latest obsession
New Delhi--Car companies ranging from Maruti Udyog Ltd, Hyundai Motors, Ford India and Honda are aggressively moving in to grab a part of the lucrative over Rs 6,000 crore unorganised second-hand exchange market. And though there are various industry estimates on the size of the second hand car market—some like Honda estimate it to be the same size as that of the new car market (6 lakh), while others put it over 3 lakh a year. According to another estimate: in the lower end market (primarily Maruti 800) there is one car exchanged for every two new cars sold, while in the higher end (Esteem and above) the ratio is virtually 1:1 (for every new car sold there is one second-hand car which changes hands). The key, of course, is the fact that with aspiration levels going up, customers are also moving up on the value chain of vehicles.
The most aggressive player in the business is Maruti which by November is set to launch its pre-owned car strategy eventually to be taken up by all its dealers.
Maruti car owners will be able to walk into any of the dealer showrooms with their old car, get it valued by expert valuers based on transparent parameters and receive cash or buy another car from the Maruti fold in exchange for the old car and pay the difference in cash or take a loan.
The second hand cars will then be refurbished and offered to customers with a Maruti warranty of six months with three free services thrown in.
The new strategy also fits in with Maruti's overall attempt to transform itself from a mere car manufacturer to a car services company which will provide insurance, finance, leasing of cars and fleet management to customers.
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Ice cream makers bid to cream the market
Ahmedabad—Nearly all ice cream manufacturers, in a bid to capture the truant market, are offering mouth-watering schemes to woo consumers.
The tactics range from slashing prices of cones to giving 25 per cent extra ice cream on the party-pack, the ice-cream makers are bending over backwards to increase sales.
For the past three months or so, Amul has been offering Rs 5 off on its Tricone, normally priced at Rs 15 and Amul officials say that the response has been tremendous, with sales of Tricone having gone up by as by ix to seven times.
Besides this, Amul has been offering 25 per cent extra ice cream in the regular 1 litre packs.
Retaliation to Amul’s price cuts, other manufacturers have also been offering shemes, such as Vadilal ice-cream has been offering 50 gram chocolate sauce with every 1 litre super vanilla pack which has been a big success. It too has slashed the price of its 1 litre pack from Rs 65 to Rs 50.
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Funded pension system considered
New Delhi—In order to restrict the mounting liability of pensions for the government, the working group on pension liabilities headed by controller general of accounts AM Sehgal, has suggested a switch over to a funded pension system for government servants. In a report to the finance minister Yashwant Sinha, the group has recommended that this is the only way to restrict pension liability from mounting beyond Rs 29,500 crore by 2009-10, from the already immense burden of Rs 21,400 crore in the last fiscal adding that the current retirement benefits for government employees are fiscally not sustainable. International experience with similar reform involves introducing significant pre-funded elements...and using modern investment management techniques to obtain a reasonable real rate of return on accumulated balances.
The chairman of the group told reporters that the working group has assumed that pension liability to the GDP ratio can come down to about 0.5 per cent by 2009-10 from the current 0.96 per cent, only if the GDP grows at an annual rate of 9 per cent.
The report says that over the next few years the number of retirees recruited during the peak periods of public sector involvement of the late 1960s and early 1970s will catch up with the existing number of government employees.
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Private players to be allowed into coal sector
New Delhi—With an end to allowing unrestricted entry to private players in exploration and production of coal the government has decided to make suitable amendments in the Coal and Mines Nationalisation Act.
With the amendment the regional offices of the coal controller of Coal India Ltd will be wound up to give greater autonomy to its subsidiaries and prospective entrepreneurs who, otherwise, found the sector unattractive in view of the large bureaucratic controls and excessive workforce.
The proposed amendment in the Act will be tabled in Parliament in the monsoon session beginning next month.
However, a centralised office of coal controller will be entrusted with the task of facilitating smooth functioning for new entrants, regulating distribution of coal and granting for opening and reopening mines and seams after winding up of the regional offices of the coal controller.
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