Automakers including Maruti, Hyundai to hike prices of up to Rs 1 lakh from January to cover raw material costs due to note-ban
Major car makers including Maruti Suzuki, Hyundai, Nissan and Tata Motors and others announced price hikes from the start of New Year amid falling sales due to demonetization.
As per the industry experts, prices of raw materials including rubber, steel, aluminium and copper have risen in the recent past.
“Rubber prices have increased by almost 40% over the past three months, copper prices are up 30% in the same period and aluminium prices are up by 10% as against the prices in September. Steel prices are also marginally higher than what it was in the recent past,” said an insider from Maruti Suzuki.
Hyundai Motors, second-largest car maker in India, will also hike prices by up to Rs 1 lakh across models from January.
Similarly, Nissan will increase prices of its vehicles by up to Rs 30,000 from next month to offset higher input costs. The hike would be on the entire range of Datsun and Nissan models.
“The price increase comes as a result of rising input costs. The revision of prices will help us offset the impact of this and maintain our competitiveness in the industry,” Nissan Motor India managing director Arun Malhotra said.
Likewise in October home-grown auto major Tata Motors had announced a price hike of between Rs 5,000 and Rs 25,000 per unit across its passenger vehicle portfolio.
According to Mayank Pareek, president, passenger vehicle business, Tata Motors said 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 the cost, and as a result, the company was forced to hike prices of passenger vehicles.
Passenger-vehicle sales expanded at the slowest pace in nine months in November just as automakers were expecting a good monsoon after back-to-back droughts to boost rural incomes and spur demand.
Sales of motorcycles and scooters, where about 65% of purchases are paid for in cash, fell for the first time in 11 months.
Within an annual production of over 24 million units, the Indian auto industry is estimated to be among the largest in the world. According to several estimates, the $93 billion Indian automobile industry contributes around 7.1% to the country’s GDP and almost 49% to the manufacturing GDP.
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