Two of the largest car manufacturers in India, Maruti Suzuki and Hyundai Motors are planning to increase price of their cars, including their latest cars – Ciaz and Elite i20 respectively. Hyundai Elite i20 was launched less three months ago, while Maruti Ciaz was launched just last month.
Apart from this, BMW India and Honda Cars India is also contemplating a price hike. This latest price hike is being contemplated because of rise in cost of raw materials and logistics. But, at the same time these companies are wary of the fact that a price hike at this point will steer some of the customers away, especially at a time when the companies have started seeing a slight increase in sales.
Last major change in car prices came back in February this year, when the excise duty on cars was slashed. All car makers passed on the benefits straight to their customers. This resulted in a boost in sales of cars in India. Indian auto industry came out of posting negative sales. For this fiscal, starting April 2014, India’s car sales have increased by 4.5% as compared to last year.
Hyundai India’s Senior VP, Mr Rakesh Srivastava said that the company is now feeling the pressure, as they have avoided price hike for an extended period. This was because they did not want to hurt customer sentiments. But, now, Hyundai India has already started discussion about price hike across range and are currently deciding on the quantum of the hike.
India’s largest two wheeler manufacturers, Hero MotoCorp and Honda Motorcycle and Scooter India have already announced a price hike last month. Other brands are also expected to follow the leaders. Same is expected in the car industry. Once Maruti and Hyundai announce price hike, other car makers are also expected to announce a price hike.
via Economic Times