Hello Somyakanta, the problem of inventory is more pronounced in the two-wheeler segment than passenger vehicles, and hence generic. On who to blame, the answer isn't so straightforward. Dealers have been trying to amplify the message since mid-2019 that retail demand is low, which is at odds with automakers' reading of the market. A large set of dealerships in India is reliant on OEMs' software, and wants automakers to report the retail figures captured by the software, instead of the SIAM data (sales to dealerships). Many industry experts I spoke with were at sea to give a revenue-size number for the automotive industry. It is imperative that the industry focuses on retail sales, rather than wholesale data. Apart from that, as dealerships get more digital and track online interest in vehicles, their estimates of market behaviour will become more scientific than the current practice of monitoring showroom-footfalls and focusing on converting that cluster.

Kunal Talgeri The Ken, Consulting Editor

Thanks Prateek, I take your point. I used the Fiat Chrysler Automobiles example because they were responsive. Perhaps it was easier for FCA because it is a fringe player, but FCA kept close tabs on the final leg to ensure inventory was sold out before February 2020. In contrast, even as late as 15 Feb 2020, the FADA had to notify OEMs to stop sending BS IV stock. Many OEMs I approached for perspective didn't want to comment on inventory.

Kunal Talgeri The Ken, Consulting Editor

Hello Suchi, two-wheeler dealers are still stuck with BS-IV inventory. We addressed it in our story because the BS-VI deadline coincided with the lockdowns. Currently, manufacturers are assessing the extent of the problem, as dealers don't want to bear the cost. This matter could also go up to the Supreme Court, based on my interactions with FADA. Mr RC Bhargava, chairman of Maruti Suzuki, is seeing one slice of the problem as the carmaker's factories in Gujarat opened after Gurgaon and Manesar. Two-wheeler factories' operations have also been disrupted like TVS Motors and Bajaj Auto because of lockdowns in Tamil Nadu and Maharashtra respectively. But think about it: will any manufacturer acknowledge oversupply in the period between Jan and March 2020? Only the dealers are stuck with excess inventory.

Kunal Talgeri The Ken, Consulting Editor

Hi Abhinav, I checked this with FADA India -- the time taken to complete one demand cycle in dealerships has gone up: from 25 days to almost two months. And, if dealers need 1,000 units in a month, they are ordering 750 because of demand sentiment. The dip in consumer sentiment was visible in mid-2019 itself for two reasons: customers were delaying purchase-decision to not be stuck with BS-IV vehicles. And two, the economy was in bad shape even before the pandemic. This is a discretionary spend. Sensing this, dealers had been requesting OEMs to slow down production from July 2019, so that they are not stuck with inventory.

Kunal Talgeri The Ken, Consulting Editor

Thanks Sanyam, that is an interesting insight. Also explains the leaning among several companies to grow in Eastern Europe.

Kunal Talgeri The Ken, Consulting Editor

In the current wave, US multinationals who have set up development centres in India include Apple, UiPath, Automation Anywhere, Cargill, Boeing, Linkedin and Exxon. I had visited the Automation Anywhere (AA) facility in Bengaluru last year, which was set up in in 2017. This is apart from 600 persons (mostly engineers) in Vadodara, a centre that focuses on customer support, service and expanding the scope of AA customers’ product journey beyond RPA (robotics process automation). The Bengaluru centre has scaled up to 760 employees, which includes techies and salespeople to grow AA’s local market presence. Bengaluru's focus will be cognitive automation.

Kunal Talgeri The Ken, Consulting Editor

You're right, Shriyansh. The move to Rural India could happen in a decentralised way, as new engineering graduates stay back in their home locations but are made a part of offshore teams of both IT service providers, as well as the multinationals' development centres. Location becomes insignificant in that model. Already, companies like ANZ and Wipro have seen their employees return to their hometowns, but who work from home. A second way is new locations for captive units--Ahmedabad (financial services), Vadodara (software services), Coimbatore (auto, pharma), et al.

Kunal Talgeri The Ken, Consulting Editor

:-) You're right, Sid. I do need to lighten my sentences. Thanks for pointing out the jargon.

Kunal Talgeri The Ken, Consulting Editor

Hi Nupur, JioMart has just rolled out its WhatsApp-enabled ordering of groceries and other provisions in Navi Mumbai, Thane and Kalyan. While they have been developing this service for a while, it still seems to be at a nascent stage. This is particularly true in terms of how it will do last-mile delivery at scale.

Kunal Talgeri The Ken, Consulting Editor

Hello Hardik, that is a great question. Many companies assume the number of unique credit-cardholders in India to be at 25 million. This is because there is a high incidence of credit-cardholders who have more than one card. According to RBI statistics, the number of credit cards in operations was at 56.1 million in January 2020. Given that, companies assume the unique number of credit-card holders to range between 25 million and 30 million.

Kunal Talgeri The Ken, Consulting Editor

Hello Thanmaya, the revenue numbers are sourced from the Registrar of Companies, Ministry of Corporate Affairs. It is for the year ending 31 March 2019. The remaining data is from Swiggy and Zomato respectively.

Kunal Talgeri The Ken, Consulting Editor

Hello Prateek, the 40-minutes example includes time for the action to be complete, and follow-ups (mechanic didn't arrive, time for nearest garage staff to come), and so on. The duration of such calls limit the number of customers a human agent can serve in a day. It was just an example to illustrate the kind of actions where human voice helps before actionable items are complete, and those items that can be automated.

Kunal Talgeri The Ken, Consulting Editor