Nano may revive auto loans biz
The automobile financing industry, in a slump linked to weak industry sales, is hoping for a surge in the demand of auto loans as a result of the building up of enthusiasm around Tata Nano, reports Sandeep Singh.autos Updated: Mar 25, 2009 23:29 IST
The automobile financing industry, in a slump linked to weak industry sales, is hoping for a surge in the demand of auto loans as a result of the building up of enthusiasm around Tata Nano.
“Nano is definitely going to increase the demand of cars and car loans,” said the head of auto loans of a public sector bank who did not wish to be identified.
Experts in the industry believe that it will people, who otherwise would have never thought of owning a car, to buy one. “Nano will bring huge change in the customers psyche as the concept of car being affordable will open up people’s mind,” said NR Narayanan, head, auto loans, ICICI Bank.
Many people would aspire to own a car now and would also create an additional market for car loans.
While Nano will bring in demand industry players feel that Nano will not eat into the share of others. “It will create its own space and will create an additional market,” said the PSU bank official.
While there will be demand for Nano, demand is also expected to go up for other entry-level cars.
“There will be spin-off benefits as other cars will also see demand coming in because of Nano,” said Narayanan.
The auto loan industry has been under pressure as the demand for the new cars has shrunk and the enthusiasm around Nano will boost the auto loan industry.