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Car makers set to increase prices

Cars manufactured in India from Indian components are set to be dearer in January, reports Suprotip Ghosh.

autos Updated: Dec 18, 2007 22:45 IST
Suprotip Ghosh

Cars manufactured in India from Indian components are set to be dearer in January. Škoda India, makers of the Octavia, Superb and Laura cars, has decided to raise prices of its cars because of rising input costs. A hike of up to Rs 20,000 is expected on various models. The new pricing for Skoda cars would be applicable from January 1st 2008. All three badges and the models are assembled in India with various levels of local parts in them.

A senior official from Škoda India said, “Input costs are negotiated on an annual target achievement basis with our vendors and the increase in prices is in line with our renegotiated terms with them. The company has made efforts to keep the price rise marginal on all models after analysing additional costs.”
Maruti and Honda Motor India Limited (HMIL) are planning to raise prices of locally assembled cars by the end of the first month of 2008 to offset rising raw material prices.

Prices of imported cars though, are expected to remain unchanged. Prices of the CR-V and the Suzuki Grand Vitara, both fully imported, are not expected to change, according to spokespersons of the two companies.
HMIL too is planning to raise the prices of its cars assembled in India. “We are looking at a price rise in January or February,” said a HMIL spokesperson. “It would be pretty much across the board, excluding the CR-V, which is imported,” the spokesperson added.

Maruti too is expected to increase prices by the end of next month. A Maruti official confirmed the move by saying that the company is looking at a price rise in January. Carmakers usually raise prices twice, in January and July, after negotiations with vendors.