India's largest car manufacturer Maruti Suzuki (MSIL) has announced a price hike across all its models from January in a bid to counter currency fluctuation and the increase in margins.
Latest reports say that other automobile companies like General Motors (GM) India, Toyota Kirloskar Motor, Volkswagen India, Audi India and BMW India are also preparing for a similar move due to the increasing pressure on margins.
"There will be a hike in the prices of our products. The quantum of hike will vary depending on models, but it can be up to Rs 20,000," said Mayank Pareek, Chief Operating Officer (Marketing and Sales), MSIL, as quoted by Press Trust of India.
Maruti India, controlled by Japan's Suzuki Motor Corp., has witnessed 5.41 percent fall in its net profit in the second quarter of this fiscal year. However, the company's November sales have gone up by 12.45 percent compared to the sales of the last year. The export figures of November have also increased by 38.37 compared to that in the same period a year ago.
Maruti India offers an entire range of cars, from the entry level Maruti 800 and Alto and other hatchbacks like Ritz, Swift, Estillo, sedans like DZire, SX4 to multipurpose utility vehicles like Ertiga and the sports utility vehicle, Grand Vitara. The latest hike will be applicable to the entire range.
Auto majors like GM India and Toyota Kirloskar have also increased the prices by 2-3 percent and the new prices will be effective from next month.
"We will increase product prices in January across all carlines ranging from one to three per cent depending upon models owing to currency fluctuation and hike in input costs," P. Balendran, Vice President, GM India, said in a statement.
Luxury car manufacturers Audi and BMW have already announced hike in prices, and Volkswagen too is considering raising prices.
"With increasing pressure on input costs and exchange rates, Volkswagen is considering a price hike," said a spokesperson for Volkswagen Group Sales India, according to the Business today.