The former CEO of Maruti Suzuki, Jagdish Khattar, this week launched his new car servicing business, Carnation Auto India Limited. The company has been launched with 9 outlets across the country – in Amritsar, Chennai, Noida, Mumbai, Hyderabad and Kochi, and plans to scale up to 30 outlets, by the end of this year. The venture has so far seen an investment of Rs 30 crore, and the management is expecting a Rs 75 crore turnover this financial year.

Currently, six out of ten consumers in India get their vehicles serviced at third-party service shops not attached to dealerships. However, customers go to third-party outlets only for small jobs like car washes, wiper replacement, headlamp fitting and servicing. They still prefer dealer workshops for denting and paint jobs. This trend, too, is expected to change as customers start trusting third-party outlets and realize that these are more economical than dealership jobs. There is a 15-20 per cent difference in what is charged by dealer workshops and by third-party workshops for the same job.

Carnation Auto will also venture into the used car business sometime this year. Other used car initiatives in the organized sector include Maruti True Value and First Choice (a JV between ICICI and Mahindra & Mahindra). Khattar told media-persons that, currently, only 10 per cent of India’s used car sales are through the organized sector. He said that Carnation intended to deal in cars in the Rs 6-8 lakh range only.