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Car prices expected to rise in the new year

Car prices expected to rise in the new year
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First Published: Sun, Dec 06 2009. 12 34 PM IST
Updated: Sun, Dec 06 2009. 12 34 PM IST
Mumbai: A steep rise in input costs, primarily in copper and aluminium components, is likely to force car-makers to hike prices in the New Year.
Several leading automobile majors, Skoda and Toyota among them, are mulling upping their prices by 1-2% to offset higher input costs, thereby passing the burden onto their consumers.
Czech car-maker Skoda India has decided to hike prices of its popular brands, the hatch-back Fabia and sedans Octavia, Laura and Superb, from January by Rs10,000-20,000 on all models, SkodaAuto India’s Board Member, Sales and Marketing, Thomas Kuehl, said.
“We are considering a price hike between Rs10,000- Rs 20,000 on all our models in the next month, as inflationary pressure and raw material costs have moved up recently,” Kuehl said.
Toyota Kirloskar Motor, too, said it was planning to up prices of three of its key models - Innova, Corolla Altis and Fortuner - by up to 2% from 1 January.
“So far, we have absorbed the increase in total costs but now we are compelled to pass on a part of it to the customer,” Toyota Kirloskar deputy managing director, marketing, Sandeep Singh, said.
“We plan to raise prices by 1.5-2% from 1 January,” he said.
Maruti is currently monitoring the prices of key raw materials and would decide on a rate hike “at the appropriate time,” a source close to the development said.
Mercedes-Benz and Fiat India have, however, not yet decided on increasing prices.
“We have not decided about it (price hike)... we will take a call at the right time,” Fiat India Automobiles Chief Executive Rajeev Kapoor said.
Mercedes-Benz India general manager (corporate communication) Manas Dewan said, “we are not raising our vehicle prices this year.”
Asked whether a hike was likely in early-2010, Dewan declined to comment.
Mahindra & Mahindra, the country’s biggest special utility vehicle selling company, is also likely to up prices of some of its models next month and is expected to take a decision by December end, a company spokesperson said.
Prices of base metal copper has risen more than 130% this year and is on course to record its biggest annual increase in more than 30 years.
Aluminium rates jumped to $2,165.25 a tonne, its highest level since October 2008. Price of silver, which is also used by the automobile industry in a small way, has risen by 1.4% to $19.34 an ounce.
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First Published: Sun, Dec 06 2009. 12 34 PM IST
More Topics: Cars | Automaker | Maruti | Skoda | Prices |