FADA President's Message August 2004 Accomplishing More Milestones Deshnidhi Kasliwal, President Dear Friends, By the time this Journal reaches you, I would have completed almost one year in the office of President of this august body. It would be appropriate we take stock of the events and activities during the year. Much water has since flowed down the Ganges. We had a change of the Government at the Centre belying all opinion polls and forecasts. Rains continued to play truant, dampening somewhat the spirits of Indian business community. It goes to show that we still bank on good monsoon and agriculture sector for driving the economy. Indian automobile industry witnessed a sort of upbeat mood during the year 2003-04. We saw a slew of new launches during the year, a vibrant export and domestic sales performance from the industry and the Indian manufacturers venturing beyond the realm of country’s frontiers to make their presence felt in the global automotive arena. Passenger cars, including MUVs, touched the magic sales figure of one million units in a single year for the first time. The industry announced impressive financial results and dividends. The performance of auto component industry and tyre industry was even more praiseworthy. Auto component exports crossed $ one billion. In nutshell, we achieved a number of milestones during the year. All said and done, it is difficult to say whether this really meant any significant upswing in the fortunes of retail automobile trade. The retail automobile trade, particularly the dealers in the volume business, by the large, continued to witness discount wars, freebies to the customers and shrinking margins. Many dealers continue to be haunted with the prospect of having to down their shutters soon due to erosion in their viability. A paradoxical situation indeed! All of us, therefore, must sit up and take note of the fast changing scenario for survival. If the corrective measures on our part and on the part of manufacturers are not taken immediately, it is not difficult to imagine the consequences. While the annual report of FADA is published elsewhere in this issue, I would take this opportunity to touch, in brief, on some of the major activities of FADA during the year. Needless to mention, the dealer viability has been a major concern for FADA for some time now. The issue continued to be on the top of FADA’s agenda during this year as well. FADA engaged a consultant to carry out a systems audit of a few select dealerships. The idea is to find out the shortcomings and deficiencies in the systems of automobile dealerships and to correct those deficiencies and improve productivity. The shortcomings observed in general would be made to known to other dealers across the country through the medium of FADA Journal to enable them take corrective action, if required. FADA entered into an arrangement with ICICI Bank for a co-branded ICICI Bank for a co-branded ICICI Bank-FADA Credit Card. The card offers a host of benefits to the automobile dealers. Service tax is relatively a new area for automobile dealers. Automobile dealers, by and large, have not been able to come to the grips with nitty-gritty of service tax law. On the top of it, various provisions of service tax law are open to varied interpretations. To clear the mist, seminars on service tax were organized. FADA also submitted Pre-Budget and Post-Budget Memorandums highlighting the issues affecting industry and trade and giving our suggestions thereon. FADA also continued its interaction with industry and authorities in the Centre and State to highlights the problems and issues facing retail automobile trade and to find appropriate solutions having regard to the viewpoint and concerns of various stakeholders. The momentous event of the year was Auto Summit 2004 held on 16th & 17th January 2004 at New Delhi attended by over 800 delegates, where we held the benefit of thoughts and wisdom of the Government, ‘who is who’ of industry, academia and professionals of international repute. The fact that there was an overwhelming response from the sponsors bears testimony to the growing recognition of FADA. I reiterate our grateful thanks to the sponsors of Auto Summit. The men behind the stupendous success of this event were none other than Mr. Vinay Nevatia and Mr. Rakesh Jain, our Past Presidents. I am grateful to them for their continued involvement in the affairs of FADA and their overriding concern for the welfare of automobile dealer community. Friends, while we may not have realized fully what we set out to do, we did achieve quite a few goals and made a steady headway in other activities on our agenda. I can understand that as an organization grows, the expectations of its constituents also grow. You may have a lot of expectations and, naturally so, since FADA has been making rapid strides and growing at fast pace over the last few years. Kindly be assured that we are not resting on our laurels and are conscious of the fact that a lot more needs to be done. I am grateful to the members of Council for reposing their confidence in me and giving their continued unstinted support in carrying out the activities of FADA during the year. I express may sincere thanks and gratitude to our past presidents, namely, Mr. Ajit Chordia, Mr. Kailash Gupta, Mr. Bharat M. Sanghvi, Mr. Ravi Poddar, Mr. Arun Sanghi, Mr. M.Ct. Muthiah, Mr. Ramesh Suri, Mr. Surender Nath, Mr. K.R. Raghavan and Mr. T.S. Santhanam, who continued to offer their guidance and wise counsel to make sure that we are on right track. I am particularly thankful to Mr. Binod Agarwal, our Vice President, who stood by me and lent his whole hearted supported in achieving our objectives. He spent a lot of time for the activities of FADA and was always there with me whether it was the Council Meeting, Regional Meeting or any other meeting. I also express my profound thanks to the directors of various committees, who took time off their busy schedules to maintain the tempo of FADA’s activities. I also place on record my acknowledgement of the support extended to us by the industry. In particular, I am grateful to Brijmohan Lallji, Mr. Jagdish Khattar, Mr. Madhur Bajaj, Mr. Rajiv Bajaj, Mr. Anand Mahindra, Mr. Subodh Bhargava, Mr. R. Seshasayee. Mr. R. Gopalkrishnan and Dr. V. Sumantran for sharing with us their vision and thoughts at various meetings and through the medium of FADA Journal. I shall be failing in my duty if I do not place on record my acknowledgement of the support and understanding shown by various authorities in the Central & State Governments on various issues of concern to the automotive business and their positive response. I also acknowledge with thanks the support of SIAM, CII and FICCI to our endeavours. I also place on record my thanks and appreciation of dedicated efforts put in by Mr. Gulshan Ahuja, our Secretary General and his team in FADA Secretariat and their allout support to me, Council and members. Last but not least, I express my profound thanks to all the members of FADA and my fellow automobile dealers across the country for their support and guidance. But for your support, it would not have been possible for us make any significant headway. I count on you support to steer FADA and automotive business to greater heights. With best wishes, Yours sincerely, Deshnidhi Kasliwal President