New Delhi, August 24, 2020: Automobile demand is picking up but the over-sensitivity and jitteriness of financial companies such as banks and NBFCs are dampening the real conversion of orders to deliveries, according to a senior official of Toyota Kirloskar Motor (TKM).
With the kicking off of festive season, the company has witnessed up to 30 per cent higher flow of orders in August compared to July, although in the last four months it has ensured that 25 per cent of wholesale is reduced every month in order to avoid inventory pile-up at its dealers.
“The number of orders that are flowing in are far higher as compared to July. I would say at least 20-30 per cent higher. One of the issues we are facing is that the financial companies, including the banks and the NBFCs are little jittery about any kind of non-compliance,” TKM senior VP, Sales & Service Naveen Soni told PTI.
He further said, “As far as order intake is concerned we are very happy. Everyday we only see good intake in terms of fresh orders but order to delivery time, while we are providing the vehicle accurately based on our supply system, is taking a bit longer because of the issues with financial companies.”
Elaborating the issue, Soni said customers who had a loan default of a very small amount ten years ago are now finding it tougher to get loans. Moreover, consumers whose CIBIL score — which is a consumer’s credit score — at a particular level would have made them eligible for 80 per cent of loan are now getting only 60 per cent at present according to the reports published in telanganatoday.com.
“The risk appetite of the finance companies seem to be very sensitive at this stage. They are becoming overly cautious and sensitive, which is making the market a bit slow. The only reason why there is a dampener is the over-sensitivity of the finance companies towards suspect customers,” Soni said.
In terms of production, he said, “In the last four months, every month despite sales increasing we have made sure that 25 per cent of wholesale is reduced so that stock is reduced at the dealer end. Every month we have been reducing stock month-on-month so that the dealer can manage customer needs at a lower inventory carrying cost.”
0 Comments