Car companies like Maruti, Hyundai are wooing cash-rich babus, faujis after arrears pay

NEW DELHI: Automakers are in an overdrive mode to woo government employees, trying to boost sales in a segment where the potential customer just got more money on hand with a pay-out of salary arrears.

Government employees including armed forces personnel have always been a key customer segment for automakers. But they have become far more important at a time when the companies fear the recent move to increase the cess on large cars to destroy a pickup seen in demand. The salary hike under the Seventh Pay Commission recommendations and the payment of arrears would, industry executives hope, cushion the impact.

From Maruti Suzuki and Hyundai Motor to Mahindra & Mahindra and Toyota Motor, all leading automakers have formed dedicated teams to expand institutional sales and lined up a slew of offers ranging from cash discounts to financing packages and insurance cover to attract customers. Maruti Suzuki has already seen sales in the segment go up by 55% to 1 lakh units in the April-July period.

Sales to government employees and defence personnel comprised about a fifth of volumes for the company in that period. “We have a model for every rank and position,” said RS Kalsi, Maruti Suzuki’s senior executive director for marketing and sales. “The company’s wide sales and after-sales service network gives tremendous confidence and assurance to these customers who are often posted in remote locations and extreme conditions.” But competition has intensified in the space, Kalsi acknowledged. Maruti Suzuki expects to sell at least at 2 lakh units to the segment this year.

Maruti Suzuki India Limited

Hyundai Motor India Ltd.