Star Choice: Fin scheme brings Merc within reach  ( June '11,2003, ET)

If your budget extends to an equated monthly instalment (EMI) of Rs 33,000 for a set of wheels, then the C Class Mercedes Benz just got within reach. Beginning from June 11, DaimlerChrysler India (DCIL) will roll out its ‘Star Choice’ finance scheme, in association with ICICI Bank.

The main feature of the new scheme is the facility of a bullet payment, which allows the customer to pay the outstanding amount, likely to be Rs 9 lakh for the C Class and Rs 12.85 lakh for the E Class, at the end of the tenure of the loan. Alternatively, the customer can pay the bullet amount annually. The EMI for the E Class will be Rs 50,000.

DCIL’s existing hire purchase schemes, offered by its preferred financiers ICICI Bank, Citibank and Kotak Finance, have an EMI of Rs 55,000 for the C Class and Rs 80,000 for the E Class, with no bullet payment facility. Suhas Kadlaskar, general manager, corporate affairs and head of finance, DCIL, said the new scheme has been worked out in response to customer needs. “Customers had asked for a lower EMI with a large payment (a bullet) at the end of the loan period. We launched this as a pilot in Delhi and Hyderabad in May and now that our dealers have been trained, we will roll it out nationally from June 11,” he said. He added that they plan to extend the ‘Star Choice’ scheme to other banks as well. The scheme has been offered by Mercedes Benz in Thailand and in other markets as well. ‘Star Choice’ has two variants for payment of the EMI and three at the end of the three-four year tenure of the loan. At the end of the loan period, the customer can pay the remaining instalment value at one go, as a bullet, get refinance for the car or trade in the car. These options apply to the bullet amount, left at the end of the tenure of the loan.

Mr Kadlaskar said the ‘Star Choice’ and other finance schemes cover only the “volume” cars, the C and E Class. The new E Class (petrol) is priced at Rs 32.37 lakh, the diesel at Rs 31.43 lakh. The C Class (petrol) comes for Rs 21.39 lakh and the diesel for Rs 23.16 lakh (ex-showroom, Mumbai).

DCIL assembles the C, E and S Class cars at its plant at Chikhali, near here, while it imports the rest as completely built units (CBUs).

DCIL has an annual sales target of 72 cars for the ‘Merc of Mercs’, the S Class, for which they take payment in advance, hence is ineligible for financing. The rest, being CBU imports, also do not get financing.

DCIL has targeted sales of 730 units of the C Class and 575 units of the E Class. “We have achieved our sales target for both models for the five months of the year,” Mr Kadlaskar said.