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Tuesday, February 10, 2015

Honda Mobilio Misleading Print Ad

On Monday, 9th of Feb 2015, Honda published a full page back cover ad in The Hindu Chennai edition declaring that it is cheaper to go to Bengaluru from Chennai in a Honda Mobilio, than in a public transportation AC Bus. 
I would usually ignore the ads and don’t bother writing a post explaining why it is wrong. But this one was about the Chennai-Bengaluru travel by road and having traveled countless number of times between these 2 cities, I couldn’t keep quiet when a full page add full of lies is so blatantly published. 

This Ad is full of misrepresentation of facts. The person who drafted this advertisement and one who approved it have either never traveled between Chennai and Bengaluru by road, or are knowingly stating false numbers to cheat prospective customers.

I am sure Honda would have given similar ads in other cities, stating that Honda Mobilio will be cheapest way of reaching a nearby destination city. Keeping above ad as a reference, this post is an analysis of travel cost between Bengaluru and Chennai, between various modes of transportation.

At first look, below is what Honda is misrepresenting in its ad
1.       Massive toll charges: For a one way travel in a car, it costs between Rs 400 to Rs 700 one way, depending on the road chosen. (Road via Chittoor and Kolar has fewer toll booths, you can save a bit if you avoid electronic city flyover and in Kancheepuram using alternate roads). Since neither Honda mobilio is exempted from toll, nor will Honda reimburse the toll expense, this cost should be added to trip expense.
2.       Unrealistic mileage. Honda’s calculations are based on certified mileage of 24.5. When a car is loaded with 7 people, their luggage and AC is ON, expected mileage is around 15-16 kmpl or less, assuming very economic style of driving. That is simply Rs 1100-Rs 1300 worth of diesel for about 350+ kms.
3.       Bus ride is much cheaper, not Rs 999 as shown in ad. On a normal day, AC bus fare is about Rs 600-700 in both KSRTC and private bus operators. Refer screenshot. Only on select festival days, long weekends price goes through the roof for last few seats, but that shouldn’t be a basis for lifetime decision like buying a car.
4.       What about the cost of ownership? If I buy a car I need to spend on EMI, maintenance, insurance etc etc forever. In public transport I have none of these liabilities. This cost of ownership should be factored while comparing.
KSRTC and Private AC bus fares between Chennai and Bengaluru- around Rs 600-700

So with above corrections applied, below are the realistic cost when traveling between Chennai and Bengaluru.
Expense\Mode
Honda Mobilio Diesel
AC Bus, AC Chair car train/Ac Sleeper
Non AC Sleeper, Train
Two wheeler (Apache 160)
Remarks

Pax
Pax
Pax
Pax
Pax
Pax
Pax

Ticket Fare
0
0
650
4550
275
1925
0

Fuel Expense
1100
1300
0
0
0
0
540
Minor correction applied for extra passenger load
Toll Charges*
600
600
0
0
0
0
0
Approx.
Last mile connectivity
100
100
Rs 50 (bus)
Rs 600 (local taxi)
Rs 50 (bus)
Rs 600 (local taxi)
30
From home to bus stand/rly station, from Rly station/bus stand to home etc (to cover end to end, approx. value is assumed)
Other
0
0
0
0
0
0
0
Assuming no parking/traffic violation fine is incurred.
Time taken is fairly same and driving effort involved is not accounted in money terms
Per day cost of ownership **
620
620
0
0
0
0
35

Total
2420
2620
700
5150
325
2525
605
One person or 7, cost in a car is almost same, but makes big difference in public transport. For one or two pax, public transportation is the cheapest.
Cost of ownership for rest of the week, month & year even when not used
Rs
620
Per
Day
Rs
620
Per
Day
0
0
0
0
Rs
35
Per
Day
I am better off using public transport and renting a car on need basis, than incur this massive expense every day.
Premium charged during peak season
0
0
500
3500
300 (tatkal)
2100
0
Approx extra paid for last minute seats during peak season
Advantages
1)Flexible timings
2)Ability to stop when needed or take any route of choice
3)Can begin a trip at short notice, no need to book tickets

1)Sleeper coaches and multi axle seats are more comfortable than some of the car seats
2)No need to drive all along
3)More luggage space
4) Can proceed to onward journey without much thoughts, while a car needs to be taken care and brought back to base


Disadvantages
1)Limited luggage space if all 7 seats are filled
2)Driving efforts are involved
3) Not very comfortable for 7 adults
1)Need advance planning & booking
2)Excessive crowd, safety & security issues at times



*buses also need to pay toll, but that cost is factored in ticket price. Bikes are exempt from toll except electronic city flyover
**Total Cost of Ownership calculation: Assuming the car is bought on 5 years loan, will be used for 6 years and then sold off, below is the total expense
For Mobilio: Rs 10 lakh on road price +Rs 3 lakhs in interest amount + Rs 2 lakhs insurance + Rs 2.5 lakhs various maintenance expense over 5 years – Rs 4 lakh (resale value after 6 years)= 13.5 lakhs/(6*365)= Per day cost

As you can see above, it effectively costs Rs 2.5k for one person to reach Bengaluru from Chennai in a Mobilio, much more than what the ad claims. Cheapest mode is by Non AC train. When there're about 3-4 people, the cost of AC public transportation and Mobilio ride breaks even.

Similar: Buying vs Renting a car  * Car cost of ownership calculations *  Honda Amaze Review * 2014 Honda city diesel *

7 comments :

Anonymous said...

The ad forgot one very important cost of driving from Chennai to BLR: the RTO catches non-Karnataka vehicles and can (wrongly) make them pay Life Time Tax for KA which is about 1.2lakhs for a Mobilio.

Factor that into the cost of travel and driving up would cost considerably more. Perhaps Honda should have made the ad advising its Chennai customers that if they frequently visit BLR, it is more economical to buy a Mobilio in BLR rather than in Chennai!

Prasad Np said...

Very good analysis...

Shrinidhi Hande said...

@Anon:
For short visits, it is fine, if you can prove with a fuel bill or toll receipt that you came in recently...

@Prasad: thanks

Anonymous said...

Well, nice write up, hope you see something fishy in vehicle sales numbers as well, which come up in popular websites/magazines. quoting 5k bookings per month etc etc.

or do you think they are all accurate.

S.SENTHILKUMAR said...

nice article, may be you should lodge a complaint with Advertising Standards Council Of India at http://www.ascionline.org/ , so that they can stop the print ad

Shrinidhi Hande said...

Vehicle sales numbers are little difficult to verify.. I am sure there will be some hike at dealer level to cook up numbers

#Senthil

I did log a complaint with ASCI.. let us see

Shrinidhi Hande said...

Hi Senthil

I filed the complaint... outcome is detailed here http://www.enidhi.net/2015/04/mobilio-complaint-advertising-standards.html