Luxury in cars, facility in finance!

One sector which has been moving steadily on the growth trajectory is luxury cars. Remaining almost unaffected by the vulnerability of stock markets, emerging signals of industrial slowdown, rising input costs and spiraling fuel costs, luxury cars are riding high on the soaring aspirations of upwardly mobile Indians.

Considering the fact that segment registered 25 per cent growth last year, it may not be a misnomer to say that it is almost immune to the developments at the macro and micro economic level.

Two important factors which may be attributed to the growth of the segment are rising economy which has equipped people with more disposable incomes and Government's support to the segment like giving reduction in import tariffs. Also the sale of luxury cars has grown due to arrival of new generation of entrepreneurs impatient to own marquee brands that connote status and success. And most of them are young.

In the recent past, India has witnessed arrival of luxury cars like Lamborghini, Bentley, Rolls Royce whereas Mercedes Benz and Toyota which have been here from many years are now contemplating to make it big in the Indian car market. It is expected that Lexus, Ashton and Ferrari will be in India soon. It is known that Ferrari has conducted a research of Indian luxury car market.

Read this:

• Super luxury cars like the Lamborghini (Gallardo & Murcielago series) and Bentley (Arnage & Continental series) priced Rs 1.5 crore and above, has witnessed an annual growth of 15-20 per cent over the last two financial years.

• Sales of Mercedes Benz in the first four months of this year are already more than half of last year's.

• BMW's Indian operations witnessed a 25 per cent growth in sales of its cars & SUVs

Not only this even Indian players are showing their interest to enter into the international luxury car market. Recently Tata Motors took over two of Britain's most famous names in automobile manufacturing, Jaguar and Land Rover.

Now with so many luxury cars in the market the question that comes to one's mind is, is there a finance option available? What is the finance scheme on these cars? You no longer have to go from pillar to post to find the best bank that will give you the best finance deal for your dream luxury car. Nowadays dealers have tie-ups with banks that give you the best finance deal possible.

We present here the finance options offered by Volkswagen - The Company has tied up with ICICI Bank and HDFC Bank for financing their top end model, Passat AT. ICICI Bank has two finance schemes for the Passat AT, one for 36 months and another for 60 months. The ex-showroom price of Passat AT is Rs. 25,13,676. ICICI Bank finances 90 per cent of the ex-showroom price i.e. Rs. 22, 62,000. The total down payment that one has to pay for 36 months is Rs. 6, 04,375 (including registration, insurance, processing fee, stamp duty and the first EMI). The interest rate for the loan works out to 10.72 per cent. The total down payment that one has to pay for 60 months is Rs. 5, 81,024 (including registration, insurance, processing fee, stamp duty and the first EMI). The interest rate for the loan works out to 11.94 per cent.

Now let's look at BMW which has a tie-up with ICICI bank for its BMW M3. The ex showroom price of the car is Rs. 7869181. As per the finance scheme ICICI Bank finances 90 per cent of the ex-showroom price of the car i.e. Rs. 7082263. The total down payment to be paid is Rs. 23, 97,247 (including registration, insurance, processing fee and the first EMI). The interest rate for tenure of 60 months works out to 11.61 per cent.

Though one can certainly benefit from these special tie-ups but this does not imply that one cannot avail financing from other banks. One should explore all the options with other banks as well before zeroing on a lender.

This way we notice that the scenario has triggered the action at the end of our bankers/ financial institutions who have gone to the extent of doing special tie ups with the players thus enabling people to turn their dream into reality.

So what is holding you? Zoom in your favourite BMW...