India
Small cars, sports utility vehicles, sedans, and two-wheelers are set to get costlier with automakers raising prices to partially absorb the impact of high material costs.
The country’s largest carmaker Maruti Suzuki on Wednesday said it will increase prices across its range of vehicles later this month to partially offset the sharp rise in input costs. This will be the fifth price hike for the company in the last 16 months.
Hero MotoCorp, Honda Cars India, and Toyota Kirloskar Motor (TKM) has already affected a price increase this month to counter the rise in procurement cost of materials. With the market leader now announcing a revision in vehicle prices later this month, others are likely to follow suit.
Shailesh Chandra, Managing Director of Tata Motors Passenger Vehicle Business, told ET that over and above a significant rise in key commodity costs and precious metals, there is now the pressure of rising freight costs and an increase in semiconductor chip costs, compelling the company to look at a price increase. Pune-based Bajaj Auto has indicated it is likely to hike prices later this month. German carmaker Volkswagen has said it is likely to raise vehicle prices by up to 3% in May. Korean auto major Hyundai, though, maintained it has no plans to raise prices “as of now”.
Maruti Suzuki itself has raised vehicle prices four times between January 2021 and March 2022 due to the rise in input costs. The total increase in its vehicles has been around 8.8% in this period. Maruti Suzuki sells a range of vehicles from small car Alto to crossover utility vehicle S-Cross. In January, the company increased prices by up to 4.3% across its range of vehicles.
In September last year, the company hiked prices across its portfolio by an average of 1.9%, except on the Celerio. Maruti Suzuki had announced an increase of around 1.8% and 1.4-1.5% in ex-showroom prices (Delhi) across models in April 2020 and January 2020, respectively. The carmaker also increased the prices of CNG vehicles last July.
Source: The Economic Times
Image Source: Google Images
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