Fire at Audi service centre scorches 19 cars, many of them beyond repair

Nineteen luxury cars were severely damaged, at least six of them completely destroyed, as a fire gutted a service centre in Ahmedabad. The incident occurred at the Audi body shop in Sanathal, Ahmedabad, in the early hours of July 13, leaving customers in a fix, who now allege that Audi India has not offered a satisfactory solution.

“My car was due for service and it required extra work since it had some minor damages and scratches, for which I applied for insurance,” said a customer who lost his vehicle to the fire, speaking on the condition of anonymity. He said he was told that servicing the car would take a bit longer than usual. “Later, I received a call from the company who said that a fire at the body shop had completely destroyed my car,” he added.

CNBC-TV18.com learns that the fire occurred at 2am on July 13. None of the stakeholders have been able to determine its cause yet. “The authorities have begun an investigation and the forensics teams are analysing the incident,” an official at the service centre said. “Some customers are obviously not happy about what happened, but all cars are insured as is the centre. So, the process of claims has begun on both fronts,” the official added.

While the employee claimed that six vehicles were completely destroyed, other sources say that 12 out of the 19 Audis destroyed are burnt beyond repair. Customers are demanding that insurance aside Audi India offer compensation for damages as the cars were under the company’s roof.

"I bought an Audi A-3 for quite a big amount a few years ago," said another customer who lost a vehicle. “My Insured Declared Value (IDV) is less than half that price, which I will get in three months. Not only do I not have a car now, but I can’t buy another car along the lines of the one I lost with the amount I'm left with after the settlement,” the customer added.

Audi India, it is learnt, then made the offer to sell used cars to affected customers with the assurance that the replacements would be of the same age as the cars they lost. “This was not agreeable to me,” said the customer. With the majority of customers unwilling to accept used cars, the company offered to sell them new cars but not beyond a discount of Rs 1 to 1.5 lakh per car. “I refused since I am willing to spend around Rs 3 lakh to Rs 5 lakh over the insurance settlement to buy a new vehicle, but not beyond that, since I am not responsible for the fire,” the customer added.

The customers have alleged that Audi has till date not offered separate compensation for the mishap, leaving them to wait for individual insurance settlements. Some customers want a temporary car to address their mobility needs while they wait for settlements to buy a new one. “Audi offered us the use of a temporary car, but that came with a list of terms and conditions including one that we ensure no scratches fall on the car,” a customer said, adding, “I said no.”

CNBC-TV18 reached out to Audi India for a comment with a list of queries over customers’ allegations. Confirming the incident, the company said in a statement: “An incident occurred at our Ahmedabad body shop facility on July 13, in which some cars were damaged. Our team at Audi Ahmedabad is fully co-operating with the local authorities in this regard. In the meanwhile, we are in touch with our customers to assist them with their immediate mobility needs.” The statement did not address allegations of unsatisfactory compensation.

From a legal standpoint, a service-provider might be obliged to pay compensation to customers for damages to a vehicle on its service premises — provided their agreement makes mention of it.

“Whether customers get compensation from a service-provider, in this situation, depends on whether the service agreement mentions it when a car is given for service,” said Chennai-based advocate Swetha Sridhar. “However, from a legal standpoint, even if the agreement doesn't make mention of compensation, a customer can still demand for it citing their individual consumer rights," she said.

Sridhar added that customers can and also must check the indemnity clause on their insurance policies to ensure their individual claims cover such incidents that occur on the premises of a service prover.