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FIAT India Sales

Discussion in 'Fiat India News' started by amogh, Feb 5, 2015.

  1. Krunal Bhatt

    Krunal Bhatt Amatore

    Messages:
    149
    Location:
    Ahmedabad
    Ahmedabad
    Punto Evo 1.3
    @SwifttoPunto
    If we look at at the sales figure of 2014, FIAT was frequently crossing 1000 mark (couple of times it was better than skoda as well). And in 2015, many a times Fiat reached 800/900 mark. So, I think last year, dealers were hopeful of a miracle, which didn't happen. ( I am not denying that Demonetization has 0 effect on this, but not the only reason as well)
    Also, Point #4 in your previous post, mentions real need of demonetization, and also shows why everyone should support it.
     
    PradeepM and SwifttoPunto like this.
  2. prabhjot

    prabhjot Esperto

    Messages:
    2,902
    Location:
    delhi ncr
    @SwifttoPunto

    I agree with everything you say except THE main one: none of the purported benefits or aims or intended effects have anything to do with cash per se. i.e., de-monetization (only more so since it is NOT de- but a re-monetization coercive scheme that suspends and/or renders-arbitrary-conditional property rights and all economic freedoms/capabilities.)

    De-/Re-monetization is the wrong means for the right (ostensible, announced) ends. Those ends are better served by for eg a good gst, which too is being completely botched-up by this government (too many rates/too many examptions/too-high-rates/cumbersome and therefore 'corrupt' administrative and legal-redressal design etc.

    What would take say 5-10 years at no additional cost (i.e., net gains in societal 'wealth' understood broadly) will hardly get achieved any quicker (most of the cash will be withdrawn come january to march) BUT will exact an exorbitant (not only economic or financial) 'price': loss of all credibility of the RBI, huge state govt's budgets getting warped out-of-shape, a flood of tax dispute cases in already dysfunctional courts, a spate of bad loans for banks and nbfc-s, large number of shut-downs of small businesses etc etc.

    The motives for this move are clearly elsewhere: namely are electoral/political and are a shortcut to the government boosting its parlous fiscal state/budget while providing some very temporary relief to borderline insolvent banks. Even the gst will reduce the revenue earned by the governments-of-India, so.

    @Krunal Bhatt

    Paradoxically then, if what you say is right, and i think so: Fiat dealers who already operate on rather lean inventories will work through this 2-4 quarters' slowdown (financially and/or in sales numbers terms) easily when compared to the bigger dealers of the biggest firms!
     
    amitshedha and Krunal Bhatt like this.
  3. SwifttoPunto

    SwifttoPunto Amatore

    Messages:
    78
    Bangalore
    Punto Evo 1.3 90 HP
    Demonitization aside as we have different opinions I want to add few points on GST. There is nothing wrong with multi-rate system. Especially for India it is a necessity. And it is not unique. It exists in other countries as well. For instance in Canada each state has different rates.
    Govt has to make lot of compromises in federal structure to bring everyone on board.
    You mentioned Govt revenue and budget gets reduced. But on contrary most of people suggested it will increase the Base and revenue. If you are referring to state budgets, they are also expected to increase as Central Govt compensates them any shortfall for 5 years taking Mar 2016 year as basis and also taking 14% expected increase. If there is any shortfall it will be for Central Govt.
    However only concern is duel control that few state Govts are insisting.
     
    Ichimaru likes this.
  4. Tony

    Tony Esperto

    Messages:
    2,070
    Location:
    Kalamboli, Navi Mumbai
    Kuwait
    Grande Punto 1.2
    The sale is going in a reverse
    I think the majority of sale is from the south
     
  5. Ichimaru

    Ichimaru Regolare

    Messages:
    472
    Location:
    Gurgaon, India
    @SwifttoPunto

    Some really nice posts there. I have been trying to explain all these to many people. Some get it, some do not. I for one, and currently hopeful that this will do good in the long run. In India, even the construction of a road 1 Km long can not be implemented perfectly and without creating a ruckus let alone de-re monetization which impacts around 1.3 Billion people in one go. Heck, you can't even ban a tv channel for one day; not even in the name of National Security :p. Hopefully, India and Indians have a brighter future.

    Coming back to FIAT, I don't know to say!
    Bring the Jeep Compass soon and price it sensibly.
    It feels like FIAT will launch the Tipo is India when it would already be 3-4 years old and ready for a facelift. We will then get the 1st Gen Tipo and the entire competition would have again moved forward. Its still not that bad and FIAT can still change their condition in India but nothing will change unless India becomes a priority market for FCA (Specially for FIAT branded products, JEEP impact yet to be seen) in terms of selling cars.

    Just reading about the slew of new cars and facelifts ready to be launched in India in 2017 makes me wonder if the FCA management cares about the FIAT brand at all. :-(
     
    PradeepM and SwifttoPunto like this.
  6. prabhjot

    prabhjot Esperto

    Messages:
    2,902
    Location:
    delhi ncr
    @SwifttoPunto

    State governments' budgets have been drastically and semi-longterm affected by the de/re-monetization. States have to finance everything from roads to schools to hospitals, police and courts and electricty etc etc! They depend on vat, road and property related taxes, so. They will have to see the next year or more through via...debt, at a time when most are again already at their debt-limits.

    GST with such high rates plus cesses plus anti-profiteering 'authority' plus a vague and heavily changeable/discretionary selection of goods and services' placing in the different tax brackets plus the ridiculously antiquated 'socialistic' concept of the anti-profiteering authority IS a complete violation of ALL of the benefits of gst (over VAT) in the first place.

    It's just that there'll be some companies and states (the ones with no/little industry and organised sector services) that'll benefit (remains to be seen, since there's going to be a large slowdown, further, in the overall economy) at the large expense of overall government revenues, the overall regressive nature of the tax. There WILL be (let's see) a pretty large decline in government indirect tax revenues, net-net, redistributed to select sectors/industries.

    The auto industry (28%+luxury tax+compensation cess) will bear a disproportionate burden under gst at the final demand end.

    BOTH the gst in this perverted form AND the entirely unnecessary extreme torsions caused by de/re-monetization will crimp an already flacid economy by the merely forced-re-distributions (i.e., ZERO-SUM forced exchange via arbitrary and illogical govt action) that will be the result of both the gst and the de/re-monetization.

    What should've and could easily have been done is (a) raising direct taxes by non-demonetization intensification of direct tax actions, removing exemptions, hiring large numbers of new tax officers etc etc (instead the direct tax to gdp ratio has been falling A LOT under this government over the last 2+ years)

    and thereby (b) having the fiscal space to enact a proper GST with relatively low rates with few bands and exemptions.

    Instead, what we have is a too-clever-by-half jugaad on BOTH the direct and the indirect tax fronts, which is an immediate AND medium-term heavy-dampener for both tax-to-gdp and the gdp itself.

    That's how I see it, at any rate. We'll see over the next year and two. A nice, total mess, all this .
     
    Krunal Bhatt likes this.
  7. SwifttoPunto

    SwifttoPunto Amatore

    Messages:
    78
    Bangalore
    Punto Evo 1.3 90 HP
    @prabhjot

    It is only speculation at this stage how far state budgets are affected and whether they are drastically and semi-longterm. If GST comes effective April 1st then whatever effect it is talked about is limited till March. Those are exaggerated statements that only couple of Govts are making.

    Auto industry is already in advantageous position. If you add Excise + VAT, the GST rate already couple of points down in many states. More than that seemless credit/input credit further puts them in advantageous position. On Luxury cars there will not be any luxury tax but there will be cess off course.

    Increasing direct tax is not correct and viable due to various reasons.

    We are absolutely on right path on GST. In a democratic and federal structure no way this drastic changes can be made without any compromises. In fact we have to appreciate the Govt effort in getting consensus while passing it and even now they are trying consensus on this in GST council.

    Any tax law or any statute evolves over the period of time. GST is a new statute for India and it has to evolve over the period of times, with experiences, court judgements, Govt changes, etc., It is the same case in any sophisticated country as well. No law gets passed perfectly on day one. Important thing is to get GST rolled out. Later suggestions will come from various sections including industry which will help it straighten further. For example our institute (ICAI) also will give another set of suggestions in this month.

    Even direct tax law is in decent shape. Just to give an example, US. There are so many complexities involved with Federal tax and return + each state tax and return, franchise tax, etc.

    So I firmly believe we are on right track. Now I believe Govt should stop trying on consensus in GST council and just move on with required majority to get the GST laws through in GST council.

    Auto industry is positive on GST mainly on account of seamless credits across materials and services which reduces cascading effect.
     
    Krunal Bhatt likes this.
  8. Krunal Bhatt

    Krunal Bhatt Amatore

    Messages:
    149
    Location:
    Ahmedabad
    Ahmedabad
    Punto Evo 1.3
    We are going off topic here BUT, I must say we have two very good views on demonetization (and GST, which was recently introduced).
    Personally, I support this move for following reason. And I would really like to know what our group members are thinking about this move and why.
    1. Bring out the black money. (I know only 30-40% of black money will come out not all, but that too will be in thousands of crores.)
    2. Already brought down sky high property price.
    3. Fake currency makers and holders will be under stress. And that will bring down the funding for terrorist activities, for another few months or so. (may be just a coincident BUT Kashmir violence reduced to almost 0 within days of demonetization)
    4. Showing off capacity of black money holders will be reduced by lot. (This one is my favorite).
     
    PradeepM likes this.
  9. prabhjot

    prabhjot Esperto

    Messages:
    2,902
    Location:
    delhi ncr
    Some points:

    (a) car manufacturers and others already enjoy some tax credits (to avoid taxes on prior-in-supply-chain taxes, or cascading) under VAT etc.

    (b) the too high indirect i.e., regressive taxation of for eg automobiles will crimp demand thereby f-ing up the financial/investment planning outcomes, and futures, for car companies, most of whom are, as it is, sitting on thousands of crores of accumulated losses

    (c) money has no colour: there is NO such thing as black or white or grey money. There is an unaccounted stock of money, but it exists very-little as cash and more in gold, property, abroad and esp on limited-liability company balance sheets with dressed-up accounts

    (d) the 'black economy' is NOT a 'parallel' economy: the opposite in fact. It is thoroughly intertwinned with the 'white economy' being a source of demand, savings, investments, working capital , AND vice versa etc.

    (e) cash-ness or in-formal-ness has nothing whatsoever to do with 'blackness'. Blackness is a function of tax compliance and tax enforcement or rather its lack. Demonising cash does NOT amount to any sort of attack on black 'money' which is, until an IT officer's assessment and after court judgments or 'voluntary' 'disclosure', completely indistinguishable from so-called 'white money'.

    (f) to attack black money by conflating it with cash is to destroy asset values, the velocity of money, the transactional friction-free-ness in value and supply-chains, SINCE so-called 'black money' IS indistinguishable from 'white money' (money has no colour, it is always just simply legal: RBI 'promises to pay the bearer....')

    (g) increased tax revenues and tax compliance that may result from better information about who has deposited how much in whose accounts will be contingent on 'tax terrorism' against everyone (in principle, even housewives and BPL jan dhan account holders!) SINCE blackness has been erroneously, but deliberately equated with cash-ness

    (h) this will result in a tsunami of tax cases, with the taxmen unable to get much tax out-of those 'bigger fat fish' they 'go after'

    (i) what is gained (as a one-off: what will the govt do in the following financial year?) will be lost in the same time period via plunging tax collections, especially indirect, due to low transaction volumes while the cash shortage continues AND due to the considerable longterm erosion of wealth/small-business-viability/bad-loans, etc, as also the sweeping insecurities EVEN among the 'innocent' caused by UNIVERSAL tax terrorism/harassment/raid-raj etc.
     
  10. Turbothinghy

    Turbothinghy Esperto

    Messages:
    1,230
    Pune
    Punto Evo 1.3 90 HP
    Bro, out of 14 lakh crores that was total money supply at that time (when demonitization happened), around 11.5 lakh crores has already come back. Also, there is still time left till 31st december, so it might be the case that almost all the money comes back and the black becomes white. But thats not the bigger picture IMO. If black money was the most important thing then Modi would have brought in some more stringent rules in order to mitigate the conversion of black money to white like scrutnizing Gold purchases etc. I guess he is majorly interested in getting all the money back into the system.

    The main reason for this step is the GST which would start getting implemented next year. It has been seen in the past for the countries that have implemented GST, there the Banks have had to bear a lot of pressure with rise in inflation for at least the first couple of years after the implementation. So in essence, this demonitization move would fill Banks' deposits (black+white) and make them stronger for the coming time.
     
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