Maruti, GM, Bajaj gear-up for another car price hike in India
The auto biggies in India are gearing-up for another round of price hike in the country in a bid to level the mounting pressure from rising cost of input materials such as steel and tyres. The auto makers like General Motors, Maruti Suzuki, Tata Motors, Toyota Kirloskar, Ashok Leyland and Bajaj Auto are mulling over to increase the price of their respective vehicles in India.
- Write a comment
We should mention here that this is the fourth time in the year 2010 when car prices are going to be increased in the Indian market. The industry, first witnessed the price hike in January due to the increasing raw material cost, following another increase in price in March and April due to an increase of 2% in the excise duty and implementation of new BS-IV emission norms, respectively.
The price of raw materials like steel and rubber has increased sharply in India in the last few months. As most of the car makers source steel from foreign markets, its price surges with the weakening currency. During the period of April-May 2010, the price of steel and rubber has increased by more than 20 to 25% due to whooping demand and increase in the rate of coking coal.
According to Mr Mayank Pareek, Maruti Suzuki India's Managing Executive Officer (Marketing and Sales), the raw material prices are increasing day-by-day and which is pressurizing the margins of the company, He added that the company is in the process of finalizing its contracts with its suppliers and any decision on the price increase will be taken after that.
General Motors India has already indicated that it is planning to increase the price of its cars in India by 2 to 3 percent from the 1st of July. The company will be increasing prices across all eight models, by 2-3 per cent to offset rising input costs, said company's vice-president Balendran.
