M&M launches car leasing service for individuals

MUMBAI: Home grown auto major Mahindra & Mahindra on Tuesday launched a solution for those Indians who want to drive a car but the related taxes, costs of insurance, maintenance and breakdowns hold them back from buying one. M&M is offering these people to drive around its KUV100NXT model for a monthly payment of Rs 13,499 and its XUV500 for Rs 32,999. It’s a leasing solution that is popular in Europe, US and other developed market but the earlier taxation structure in India had rendered such offers a costly proposition for customers.“After the launch of GST, automobile leasing has become more attractive and lot of the negatives associated with this offering have gone down substantially,” VS Parthasarathy, group CFO, M&M said.
For customers, the cost of leasing is slightly higher than what they would pay if they buy a car on loan, company officials said. However, if one leases a car, then the company will take care of services such as insurance, end to end maintenance, on-road assistance, accidental repairs, 24 hours replacement vehicle etc. Also there is low or no down payment, zero risk on resale value of the vehicle and a fixed EMI inclusive of maintenance cost, the company said. On a comparative basis, officials said, the leasing rate would be slightly higher than the EMI but the value addition is the services the customer gets for free.
Initially Mahindra’s lease offering is being rolled out in six cities - Pune, Ahmedabad, Bangalore, Hyderabad, Mumbai and New Delhi, while 19 more cities will be added in a phased manner, Parthasarathy said.
The lease offer will be available on M&M vehicles such as KUV100, TUV300, Scorpio, Marazzo and XUV500. “The company has partnered with Orix and ALD Automotive, globally renowned and leading leasing service companies, for this offering. The leased vehicle will be available for period of up to five years depending on the city and model selected,” a release from the company said.