In the two-wheeler space, Ather Energy has started extending personal lease options on premium, battery-powered scooter Ather for a monthly rental of Rs 2, The company refunds the entire down payment of Rs 75, at the end of three years. In India, where pride of ownership has driven vehicle purchases for decades, the personal vehicle leasing market is at a nascent stage.
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However, with younger, millennial consumers preferring ride-sharing services, industry veterans say there has been a shift in mindset. Consumers now prefer to drive a vehicle unencumbered by the investment—financial and otherwise--of owning a car and the potential is huge, said Vikas Jain, national sales head at Hyundai Motor India Ltd HMIL.
If a vehicle is returned before the term is over, the user will typically have to pay a certain amount to the company, depending on the time remaining for the lease to end. The person can also choose to buy the car. In India, this segment has started witnessing a positive trend. Once it reaches a certain threshold, it will become very interesting. We will have to see how it develops here. We are keeping a close watch and will gear up accordingly. Ather Energy co-founder Tarun Mehta also sees promise in leasing. I expect as much as one-third of our sales to come from leases by the end of this year, increasing more later next year.
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