Price Hike In Indian Auto Industry Continues
The increase in the price of raw materials and update in emission norms are main reasons given by OEMs this time for the hike
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It’s that time of the year when auto manufacturers announce price hike in its line-up. The increase in the price of raw materials and update in emission norms are main reasons given by OEMs this time for the hike. Ford India, the Indian arm of the US-based auto major Ford is the latest player in the domestic market to announce a price hike. Its Indian line-up will become dearer by up to 2 per cent from April.
"Owing to input costs, Ford cars will see an increase of 1-2 per cent from April," a Ford India spokesperson said.
The company sells a range of vehicles in the country, from Figo hatchback to iconic Mustang sedan, which is priced at Rs 4.65 lakh to Rs 66.3 lakh.
Earlier this month, Japanese carmaker Honda had announced that it would jack up prices of its models by up to Rs 10,000 from next month to offset higher freight charges and input costs. Jnaneshwar per, Senior Vice President, Marketing and Sales, Honda Cars India said, “Due to the rise in freight charges and input costs, we are forced to consider increasing the car prices for most of our models. This increase in price will be effective from the first week of April 2017.”
Other mass passenger vehicle players like Maruti Suzuki, Tata Motors, Mahindra & Mahindra, Hyundai Motor India have already announced or implemented price hike in the last 3 months, owing to same reasons.
In December 2016, Korean carmaker Hyundai announced a price hike up to a whopping ? 1 lakh across all models in the company's line-up.
Rakesh Srivastava, Senior Vice President, Sales and Marketing, Hyundai India said, "In these challenging year-end market conditions, we are constrained to consider price increase on account of factors like increased input costs, fluctuating exchange rates and increasing marketing expenses."
While Maruti Suzuki increased price up to Rs 20,000 for its vehicles, Tata Motors too increased prices by Rs 5000-25000 across its range of vehicles from January 1st, 2017. Mayank Pareek, President, Passenger Vehicle Business, Tata Motors, "The increase in prices of raw material commodities like steel, aluminium, copper and rubber over a period of time has put a lot of pressure on us and as a resultant, we are forced to hike prices of our passenger vehicles."
As per reports, key raw material prices like Copper and steel has increased by 12-15 per cent in recent years. The price of natural rubber, which used to be Rs 100 per kg, has gone up to Rs 200 per kg.
As of two-wheelers, the price hike has been nominal. BS-IV compliance has added to the cost of vehicles, which will inevitably be passed on to customers. Most vehicles from Suzuki, TVS, Bajaj, Yamaha, Hero and Honda have already witnessed small price hikes. Royal Enfield bikes are expected to be costlier by Rs 4, 000 from April 1st.
Luxury car makers BMW and Volvo Auto India announced to increase prices of vehicles across its model range by up to 2 per cent from April.