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With the kicking off of the festive season, the company has witnessed up to 30 percent higher flow of orders in August compared to July, although in the last four months it has ensured that 25 percent 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 percent 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 Vice President, Sales & Service Naveen Soni told PTI.
He further said, “As far as order intake is concerned we are very happy. Every day we only see good intake in terms of fresh orders but the order to deliver timely, while we are providing the vehicle accurately based on our supply system, is taking a bit longer because of the issues with financial companies.”
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“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.
Stating that auto companies are not asking financial institutions to give out loans irresponsibly, he said there needs to be a consistency in the ‘yardstick’ of measuring consumers who qualify to avail of car loans.
At the same time, Soni said that due to the Covid-19 pandemic-induced lockdown, time taken to do field investigations before approving and sanctioning of loans has also increased.
On the demand side, he said that with festivities such as Ganesh Chathurthi and Onam falling in August, the pick up has been definitely better and running at a higher pace than July. The demand has been progressively increasing each month since May after the total washout in April.
In terms of production, he said, “In the last four months, every month despite sales increasing we have made sure that 25 percent 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.”