Maruti Suzuki is planning to reduce the down payment cost of its cars by 5 to 10 percent. The slowdown in the vehicle sales and the higher initial costs for the buyers have prompted Maruti to come up with this initiative.
The automaker is tying up with the banks to lower the down payment costs for the buyers. Currently customers are buying cars by paying about 20% of the on road price as down payment and the remaining is financed by the banks. So Maruti is planning to reduce initial cost about 5% to 10% which is Rs 40000 to Rs 45000 for a vehicle that costs Rs 4,50,000 on road.
It has started this program with Kotak Mahindra bank from January 2020 and expects to rope in more banks.
The slowdown of NBFC financing and bank’s cautious strategy in issuing new loans has significantly affected the auto market in India. More and more people are delaying to buy new cars because of the higher costs from the pocket. Any people who have plans to buy cars are choosing used cars.