Car distributors shift gear by offering freebies such as tax rebates, extended warranties and golf club membership to keep sales up
The Sunday Times
My Lifestyle, My Drive
15 May 2011
By CHERYL TAY
WITH a shrinking quota for Certificate of Entitlement (COEs) and rising prices of cars, the distributors are sweetening the deals with interest-free loans, rebates, free parts and accessories as well as extended warranties to entice car buyers.
They are fighting hard to preserve their market share and achieve sales targets by offering customers more value for money.
Mr Victor Tan, general manager of Champion Motors, the local distributor for Japanese car brand Suzuki, says: “We enhanced our packages by giving customers better value and ease of mind when considering the purchase of our cars. What we have done is to offer a ‘High on Fives’ package, which includes five years’ warranty, five years of free servicing and five years of free road tax for Category A vehicles.
“The Category A buyers are the hardest hit by the COE hike; hence to ease their burden, we offered five years of free road tax for the SX4 hatchback, SX4 sedan and APV, on top of the other promotions. We even ran a special sale with an outright $15,000 off on the Swift model range.”
Category A refers to cars of engine capacity 1,600cc and below, including taxis. Besides such incentives, other dealers like Cycle & Carriage France — the local authorised dealer for Citroën — offer non-car-related lifestyle promotions such as golf club memberships or spa treatments.
Promotions are tactical and seasonal whereby the mechanics will differ depending on brand and car model; thus it could even be topical. Essentially, Citroen tailors the promotional offerings to suit the different needs of the brand’s target audience.
For example, purchase of the Citroën C5 came with a lifestyle indulgence treat worth $1,000 as the target audience appreciates more pampering promotions.
Here are examples of deals offered recently:
This is very common and it is given for all car brands.
Early this year when the COE prices shot up, Mercedes-Benz at Cycle & Carriage put together a COE saver package that includes a range of discounts, used car credits and servicing credits for the C-Class, E-Class and S-Class models. Packages were tailored to the different engine variants at different weeks of the month.
Mercedes-Benz also offered COE premiums at lower prices, for example they offered COE premiums at $43,888 previously, while the COE premium was in the region of $60,000.
Extended servicing & warranty periods
All cars come with a standard warranty package with free servicing up to a pre-determined mileage.
Borneo Motors — authorised agent for Lexus and Toyota — has offered five years’ extended warranty with unlimited mileage for all their Lexus Hybrid models, while Lexus cars come with two years of free servicing.
Toyota offered a three-year comprehensive maintenance plan on their Multi-Purpose Vehicle (MPV) range — the Alphard, Previa and Wish — which includes complimentary servicing that comes with free parts replacement, and a five-year unlimited mileage warranty.
Both Champion Motors (Suzuki) and Kah Motor (Honda) are giving away five-year warranties and five-year servicing packages.
All Honda models were given the fiveyear warranty for unlimited mileage, while the City and Jazz owners got a five-year servicing package (or up to 100,000km).
Likewise, Cycle & Carriage has given an extended vehicle warranty of five years at unlimited mileage for Mitsubishi and Kia, while Citroën cars were given three years’ warranty or up to 100,000km.
Mercedes-Benz, also under Cycle & Carriage, focused on aftersales care and offered substantial service credits that owners can use for servicing and the purchase of maintenance packages.
Tan Chong Motors sold their Nissan Sylphy and Teana models with a standard package including $10,000 worth of service vouchers, a three-year factory warranty, two-year motor protection programme and a Smart Screen Navigation System.
Financing and insurance
While Borneo Motors gave a five-year interest-free loan for the Lexus IS250 model and a $2,000 insurance subsidy as well as cash subsidy upon taking a financing loan for Lexus models, Mercedes-Benz and Citroën at Cycle & Carriage offered subsidised interest rates so as to give more savings to customers.
Free parts and accessories
Another value-add is by means of parts and accessories upgrades. Lexus has special discounts on accessories, such as rims upgrade at promotional prices, or complimentary solar film with the financing scheme.
Mercedes-Benz and Nissan provided free accessories to enhance the look of new cars. For example, the Nissan Latio Sports series came with the Nismo Aerokit as well as sports rims and leather seats, which were previously available as an option at additional cost.
Free road tax
Suzuki offered five years of free road tax for Category A buyers in addition to the other promotions. Nissan upped the game by offering 10 years of free road tax for their best-selling commercial vehicle series.
Car model ranges come at various prices. Lexus offered a free upgrade to a higher variant at no increase in price. For example, customers who bought a GS300 or RX350 were allowed a free upgrade to the Hybrid variant.
Depending on the type of car and its customers, some car distributors have given away lifestyle treats other than the typical car-related incentives. For example, the Toyota Camry 2-litre, 2.4-litre and Hybrid models come with two exclusive golf club memberships with Ria Bintan and CityGolf worth $8,000. Others like Citroën give personal indulgence treats.
For the latest car deals, visit the showrooms.
*This was first published in The Sunday Times.