Blame it on the depreciating rupee. Consumer durable prices are not likely to fall in the near future even as prices of input materials like steel have fallen globally recently.
Add to it the government’s recent decision to impose a five per cent import duty on steel, high-end refrigerators and washing machines might just get costlier soon.
“Easing up of the steel input cost has been offset by the rupee depreciation and there is no scope of reducing prices,” said a Samsung official.
The rupee has depreciated by over 25 per cent over the last few months and was trading at around Rs 50 against a dollar.
“The environment is volatile and there is no idea where the currency is headed,” said V Ramachandran, director marketing and sales at LG Electronics India. “Components such as picture tubes are still being imported and there are no chances of prices coming down in the near future.”
The government on Tuesday stamped a five per cent import duty to safeguard the domestic steel suppliers.
“There will be an impact of the import duty on manufacturing cost of home appliances such as refrigerators, air conditioners and washing machines,” said Ravinder Zutshi, president of the Consumer Electronics and Appliances Manufacturers Association.
Most manufactures said that a majority of their consumption is of domestic steel, and therefore, might not impact prices of all products. Domestic steel prices are higher than imported steel by almost Rs 10,000 per tonne.
“Most of our steel consumption is domestic and imported steel is used in a few high-end refrigerators,” said Pranay Dabhai, chief operating officer, Haier India.
“There could be negligible increase in the cost of certain premium refrigerator models,” said Videocon’s PK Gupta.