My first car purchase-evaluation process

March 2021 Update:

While I had booked Tiago, the experience didn't go well. So I have now bought Hyundai Venue. I am now poorer by 3 more lakhs, but have better ground clearance, few more features and hopefully better experience overall.

------------------------ Original post ------------------------------

15 years after I started working, I finally decided to buy a car of my own. All these years I was comfortably managing without owning a car, thanks to self drive rental companies. I had a bike for my daily office commute in Chennai and would rent a car on need basis from Zoomcar, Myles etc for my weekend trips. This model worked very well as I didn't have to spend lakhs of rupees buying a car but still could experience driving several cars in different cities for few thousand rupees in rental expense. Thanks to self drive rental I could drive cars like Audi Q3, Mercedes C Class, E Class, GLA, Maserati  and more- cars I would have never afforded to buy.

However a lot of things changed in 2020 forcing me to consider buying a car for myself.

• I faced my first road accident in Sep 2020 on my bike. Lots of people suggested I should buy a car now which is lot safer. As I am nearing 40, I saw merit in this point. Need to start focusing on comfort, backpain, fatigue etc and not just reaching destination in lowest cost. Car is always safer than a bike.
• I shifted to home town (Udupi), we are a family of four, so taking them around in two wheeler was not possible. A car will be lot convenient for the family travel.
• Udupi gets lots of rain from June to October (5 months) unlike Chennai where it rains barely 2 months a year during which I can manage work from home or bus ride or bike ride with jacket. Going to office on a bike during rainy season is not practical. A car is lot more convenient.
• Highway in Udupi (NH66) is a lot unsafe for two wheelers unlike a city, because of high speed trucks n buses, rampant wrong side driving, lack of signals n policemen and other issues. Every week I read about one or two accidents where a two wheeler rider is injured or dead.
• Self drive rental companies do not operate out of Udupi and car subscription models also not available in tier 2 city like Udupi. Public transport or own vehicle it is.

Once I decided to buy a car, I had to make several decisions. I evaluated various options as below:

Decision 1: Used car vs New car

It felt like a sensible decision to buy a used car for 3-4 lakhs instead of spending 6-8 lakhs on a new car. I thought about it, but decided to buy a new car only because of following reasons:

• Old cars have a lot less safety features compared to 2020 made cars. Now driver airbag is standard in all cars, most cars have ABS & EBD, better built body compared to budget cars made 4-5 years ago. Couldn't risk safety on a highway with old cars without adequate safety features.
• Maintenance: My usage will be about 50 kms a day. At this rate, I felt new car is better. Old car might cost more to maintain.
• Used car dealers keep about 1 to 2 lakh margin per car. For best deal we've to find a owner willing to sell his car directly- which is bit complicated and getting a car that suits our requirement is another challenge. I planned to use my car for at least 4-5 years before next upgrade, so I felt new car option is better. Instead of paying 4-5 lakhs for 3-4 year old small car I preferred to spend a few lakhs more and buy a first hand car.

Decision  2: Subscribe vs Buy

Zoomcar, Revv and other agencies offer cars on monthly subscription fee basis. These are touted as smart options as we don't have pay down payment, maintenance etc. But I had to reject this option due to following reasons

• Their subscription fee is more than EMI [Maruti's subscription model analysed]
• End of subscription period we get nothing- no car, no resale value, nothing
• Lots of restrictions on usage like kms, having to pay interstate entry fee, top speed limited by speed governor etc, what is covered under maintenance and what is excluded and so on.
• Lots of complaints online about refund issues and other business ethics.
• Most of these companies have office only in Bengaluru, not in Udupi

Related: Revv vs Zoomcar Zap Subscribe comparison

Decision 3: 5 seater vs 7 seater.

Temptation was very high to consider a 7 seater such as Renault Triber or Maruti Ertiga. They have little more space, 2 more seats and can help take few friends or extended family members along. While this sounded like nice proposition, I decided against it because of following reasons

• The need to carry 7 people is once in a blue moon requirement while all the expenses of an MPV (high initial price, lower fuel economy, higher insurance premium etc) will be permanent. If a real need arises that few more people have to be transported, better to hire a taxi for that specific trip, than spend more money every day.
• Triber was tempting at about 8.5 lakhs but unknown safety rating, poor build quality was a concern. Ertiga and XL6 were getting beyond my budget and I couldn't justify spending so much.

Decision 4:Automatic vs Manual

India is moving towards Automatic. Lots of people prefer it now as it is more convenient. Automatics are getting better day by day, giving better fuel economy. But I decided to stick to Manual because of following reasons

• My usage was mostly on highway and a bit in city. So I was fine with having to change gears manually
• Budget cars only get AMT and not a more professional and reliable automatic technology like CVT or DSG. AMTs are a compromise and cost about half a lakh more. Decided to manage with stick for a while.
• I am bit old school and want my body, mind and soul to get involved in driving. Automatic, cruise control and other effort saving technologies can wait. The joy of shifting from 4th to 5th gear is not possible in AMT.

Decision 5: Hatchback vs compact SUV vs premium hatchback

My heart wanted Nexon. But Nexon costs 5-6 lakhs more than Tiago and more to tank up n maintain. The usage of long trips, having to negotiate bad roads etc are once a while scenarios, didn't justify me taking loan and spending beyond my means. I decided to stick to a decent hatchback for now and think of an upgrade after 5 years.

Premium hatchbacks like new i20, Altroz cost 2-4 lakhs more for just a few extra features. I wasn't very sure if I need all of those. Felt small car like Tiago is enough.

Decision 6: Electric vs Petrol vs Diesel

Nexon EV is affordable at about 15 lakhs. But I felt EV technology and infrastructure still needs few more years to reach some maturity. May be 5 years down the line we will have cheaper batteries, charging infra, better range and more reliable electric vehicles. Right now I felt it is not the right time.

Diesel costs almost same as petrol now. The cost benefit of paying more for a diesel car I couldn't justify. Also most entry level models are available in petrol only now. For diesel we have to go for Altroz, new i20 etc, costing around 10 lakhs.

Decision 7: Must have, nice to have features

• Passenger airbag is a must: Most entry level variants have only driver airbag (that too because Govt made them mandatory). I didn't want a situation where car crashes, I survive because of driver airbag but a family member gets hurt because there was no passenger airbag. Because of this I decided to ignore all variants that didn't offer passenger airbag. I might have to spend a lakh or two more but no compromise on basic safety.
• Need basic comfort. Cheapest variants often miss on AC, music system, second row power window and so on. So your passengers will feel they are sitting in an Auto, not a car. I decided I can skip some features like climate control, cruise control, push button start, sunroof, dual tone etc but need decent music system, AC, power windows, dual airbag and few other essential features.
• NCAP crash ratings: Maruti Espresso got ZERO star, Grand i10 Neos got 2 star, Kwid didn't look promising either- so I decided to ignore these unsafe models and stick with a 4 or 5 star rated car

Decision 8: Which company & model?

After I decided I will buy a small car in 6-8 lakhs budget, I evaluated several options in the market. Below is a quick snapshot.

#	Make	Model	Pros	Cons
1	Renault	Kwid	High Ground Clearance Cheaper to buy (6 lakhs on road for near top end variant) Quick availability	Poor safety rating (2*) Poor build quality
2		Triber	High ground clearance 7 seater 4 airbags Affordable (8.5 lakhs)	Unknown safety rating Poor build quality Underpowered
3	Hyundai	Grand i10 Neos	Quick availability Lots of features Fun to drive	Poor safety rating (2*) Different manufacturing process for India n export
4	Maruti	WagonR	Height Affordability Good resale value Cheaper to maintain	Poor safety rating
5	Tata	Tiago	Recommended by few friends Had attended media drive, so know about the car in detail High safety rating Feels reliable	2 month + waiting period Less ground clearance Public-ve comments on Tata aftersales service No armrest n height adjustment in second row
6		Altroz	5 star rating 2nd row armrest n headrest height adjustment More features	2 lakhs more expensive than Tiago Slightly less ground clearance and wider
7	Nissan	Magnite	Low price	Nissan brand’s survival in India not known Unknown safety rating New releases are risky to buy
8	Kia	Sonet	Lots of features	3 month waiting Unknown safety rating New product
9
10

Decision 9: Loan vs cash

Still evaluating on this. Don't see any benefits of availing loan, paying 7-9% interest over 2-3 years (costing about a lakh more in interest). Might manage with digging deeper into savings. Let me see.

Heart wanted Nexon, pocket could afford only Tiago

I would have loved to buy a Tata Nexon- it has lots of ground clearance, sunroof, wide tyres, powerful engine and lots of cool features. But then on road price of top spec Nexon is almost 14-15 lakhs. After this I need to set aside 50k per year for insurance, compromise regularly on mileage (compared to say Tiago). With my savings I could only afford a Tiago. For Nexon I had to take loan, more money in EMI and interest payment. So with heavy heart I decided to begin my car ownership experience with a small car- Tata Tiago that costs about 7 lakhs on road- which is reasonably safe and has fair amount of features.

Decision between Tiago, Tigor and Altroz

Altroz has 5 star safety, has lots of extra features. But Altroz has same engine as Tiago, has 5 mm less ground clearance and costs about 2 lakh rupees more than equivalent Tiago variant. So I decided to stick to Tiago. Tigor is Tiago with a small boot- I didn't have any need to carry lots of cargo, so decided to stick with Tiago.[Detailed study here] 

Variant selection

I decided to eliminate entry level XE and top of the line XZ+ dual tone. Had to decide between XT and XZ. After evaluating the difference in features and price, decided to settle for XZ. Compared to XT, XZ costs about 70k more and gets fog lamp, rear wiper, cooled glove box, driver seat height adjustment, better infotainment system, auto fold mirrors etc. Compared to XZ+, XZ misses alloy wheels, reverse camera and climate control and saves me 30-35k. These things I can manage without, so XZ looks fine for me.

Do let me know your thoughts.