Tata Motors Hit By Steel Price Rise

New Delhi, Feb 27: | Updated: Feb 28 2004, 05:30am hrs
Tata Motors Ltd has on Friday said a sharp increase in domestic steel prices was pushing up costs, which could force the company to increase vehicle prices.

The impact of the steel price increase is quite severe, Ravi Kant, executive director of Tata Motors commercial vehicles business, said. If the rates are revised even further, then it is surely going to have an impact on our cost, no doubt about it, and it is already beginning to have.

Steel prices in India have nearly doubled over the last year, tracking a global trend and rising raw material costs. The automaker is trying to offset the impact of the higher costs by negotiating prices with steel firms and by cutting costs.

So, a part has to be absorbed and a part will be passed onto the consumer, Mr Ravi Kant said. He said he expected sales growth in the commercial vehicles industry in the new financial year beginning in April to slow from 36 per cent in the first 10 months of this year.