Tata Motors to take a call on price hike later this year
Even as rupee depreciation is adding to the stress in the automobile market, Tata Motors will evaluate passing on its impact to consumers only around December to avoid price hike during the festive season
New Delhi: Even as rupee depreciation is adding to the stress in the automobile market, Tata Motors will evaluate passing on its impact to consumers only around December to avoid price hike during the festive season, a senior company official said on Wednesday.
The company, which introduced an upgraded version of its compact sedan Tigor priced between ₹5.20 lakh and ₹7.38 lakh (ex-showroom), is also looking at launching a premium hatchback next year to widen its product offering.
“That’s a stress. Till a point we can absorb and we will absorb, but otherwise we are running a sustainable project and we have to win sustainably,” Tata Motors President, Passenger Vehicles Business Unit, Mayank Pareek told PTI.
He was responding to a query on the impact of rupee depreciation against the dollar on the company’s cost of imports.
Pareek further said, “We have about 25-30% import content both directly and indirectly.” On Tuesday, the rupee slumped by 33 paise to finish at a fresh lifetime low of 74.39 against the US dollar on high crude oil prices, strengthening of the greenback and unabated foreign fund outflows.
When asked if the company planned to pass on the impact to customers, he said, “We will watch but for the festive season we would not like to disturb the pricing.” By year-end, around December, the company could decide on the price hike, Pareek said adding, “Certainly we will have to do, but we cannot completely pass on the entire burden to customers.” Commenting on the market sentiment, he said there is “stress” due to factors such as high fuel prices and non-availability of vehicle finance.
“However, at Tata Motors we are looking forward to a good festive season on the back of the actions we have taken up, such as introduction of new products to build on the growth we have had this year,” Pareek said.
In the second quarter, when the industry PV sales have declined by 3.2%, Tata Motors grew by 19.1%, he added.
On the new Tigor, Pareek said the company expects the model to be a strong player in the compact sedan segment which has witnessed growth in the last two years after witnessing a decline previously.
“Customers had moved to compact SUV from compact sedan. However, in the last two-three years with the introduction of new exciting products, people have again started buying products in this segment,” he added.
The new Tigor will be available in petrol version powered by 1.2 litre engine and diesel with 1.05 litre powertrain.
The petrol variants of the model are priced between ₹5.20 lakh and ₹6.65 lakh, while the diesel trims are tagged between ₹6.09 lakh and ₹7.38 lakh.
On new product plans, Pareek said the company is looking to fill gaps in its portfolio to enhance its presence in the overall market segments.
“Around three years ago, we were present in only 50% of the market. We have increased in to around 55-60% now. The aim is to be present in 90% of the overall PV segment,” he said.
While Tata Motors is gearing up to launch its SUV Harrier early next year, Pareek said, “We are still not present in the premium hatchback segment, which is also something we will look to address next year.”
- Nokia 7.1 Plus (Nokia X7) launched in China, prices start at Rs 18,000
- Walmart trims 2018-19 earnings forecast on Flipkart deal
- Foodpanda acquires Mumbai-based Holachef
- South Indian Bank shares zoom nearly 17% on robust Q2 show
- US’ Iran sanction: Govt says no issues with oil supply, sentiment hurting price
- IndusInd Bank’s Q2 results show a peek into the IL&FS booby trap
- So which liquid, money market funds did investors flee from in September?
- Dr Reddy’s: API unit sale should lower costs, may not be a windfall
- Demerger in final leg, CESC stock yet to reflect value unlocking benefits
- Banks turned wary of NBFCs months before IL&FS defaults