New Delhi: A day after the Union government announced a 4% reduction in central value added tax, clubbed together with excise duty, car makers passed on the full benefit of the duty cut to consumers. In most cases, these cuts are in addition to the hefty discounts announced last week for sales of cars in December.
Maruti Suzuki India Ltd, the country’s largest car marker, reduced the price of the Maruti 800 by Rs6,593 to Rs1.86 lakh. The Alto will now be cheaper by at least Rs8,028 to Rs2.26 lakh and the Swift has had its price reduced by Rs12,458 for the Lxi model. The company has not reduced the price of the Grand Vitara as it’s imported as a completely built unit and hasn’t benefited due to the duty reduction.
Hyundai Motor India Ltd reduced the price of the Santro by Rs8,834 to Rs256,299 and the i10 by Rs11,247 (new price: Rs325,927). The i10 comes with free insurance and Rs5,000 worth of accessories in a company offer valid till 15 December. Toyota Kirloskar Motor Ltd cut the price of the Altis by Rs34,100 and the Innova by Rs23,980. Hindustan Motors Ltd said it would reduce prices of the Lancer by Rs25,000 to Rs7.74 lakh.
—Staff Writer
*********
Jet may lease planes to Gulf Air, Turkish Airlines
Mumbai:Jet Airways (India) Ltd, the nation’s biggest domestic carrier, plans to lease five aircraft to Gulf Air Co. and Turkish Airlines Inc. to cut costs.
Jet will lease two Airbus SAS A330 aircraft to Gulf Air for four months, the carrier said in a statement to the Bombay Stock Exchange on Monday. Three Boeing Co. 777 planes will be leased to Turkish Airlines for six months, it said.
The aircraft became available after Jet restructured some routes and undertook other cost saving measures, the statement said.
—Bloomberg
*********
RBI may further cut repo rate by 150 basis points
Mumbai: The Reserve Bank of India (RBI) could cut its repurchase auction rate, at which it infuses cash into the banking system, by 150 basis points (bps) more by mid-2009, Goldman Sachs Group Inc. said on Monday.
The reverse repo rate, at which the central bank absorbs surplus cash, could be cut by a further 100 bps, the financial firm said in a note.
RBI on Saturday cut both its key short-term rates by 100 bps each to boost economic growth in the wake of a global credit crisis and recession in some major economies.
The repo rate is now at 6.5%, and the reverse repo rate has been reduced to 5%, its lowest in more than three years. Goldman expects a corridor between 4-5% between the reverse repo and repo rate by mid-2009.
“The risks are clearly towards even more aggressive cuts as growth continues to falter, and inflation declines rapidly”, Tushar Poddar, economist at Goldman, said in the note.
—Reuters
*********
UBI, HDFC Bank cut prime lending rate
Mumbai: At least two banks cut their lending rates on Monday, responding to the policy rate cut by the Reserve Bank of India.