Automobile Desk: The festive season is considered to be the most special in terms of sales of new vehicles in the Indian automobile market. In this long festive period starting from Ganesh Chaturthi, Navratri and continuing till Dhanteras and Diwali, car companies make a flurry of offers to woo customers. Showrooms witness a huge footfall of customers and everyone is in a race to bring home their dream car. But have you ever noticed that on what basis and why do auto companies give such huge discounts during the festive season? Let us understand the practical mathematics of this entire discounting model.

Whenever you plan to buy a new car during the festive season, companies offer you total discounts in many different ways. The biggest reason for this is 'stock clearance'. Every auto company wants its old stock to be completely sold before the beginning of the new year, because as the year changes, the resale value of the previous model gets affected. This is why companies, under pressure to clear inventory, offer more aggressive discounts on old stock.

Furthermore, the most direct benefit is given in the form of 'cash discount'. This discount given directly on the ex-showroom price of the vehicle immediately attracts customers. At the same time, if you already have an old car, then you also get the benefit of 'Exchange Bonus' while exchanging it for a new car. Companies add additional discounts on the purchase of new cars by taking used cars through their existing dealership network.

'Corporate Discount' is another important means for employed and corporate employees, which can be availed to further reduce the price. Not only this, dealers often offer car accessories like floor mat, body cover, seat cover for free. In this way, by saving the cost of accessories kit, the customer directly gets additional savings of thousands of rupees.

Apart from car companies, the role of banking sector is also very important in this whole game. During the festive season, almost all major banks and finance companies offer special schemes on auto loans. During this period, loan processing fees are completely waived off and interest rates are also discounted. If a customer chooses the right bank and compares the interest rates to avail the loan along with the showroom discount, he can save a huge amount on the on-road price of the vehicle.