Cars and utility vehicles are set to become dearer as several carmakers are expected to increase prices in the range of 2-5% from January 2019, to offset input cost and push year-end sales.
Cars and utility vehicles are set to become dearer as several carmakers are expected to increase prices in the range of 2-5% from January 2019, to offset input cost and push year-end sales. While Toyota and BMW have already announced a price hike of 4%, Hyundai, Honda and Ford are likely to announce a rise soon, according to dealers associated with the companies. A Hyundai dealer said the announcement will come soon as the carmaker has been routinely increasing price atleast for the last four years in January.
“The intimation is likely to come during the second or third week of December,” the dealer told FE. “The price hike was expected as input costs have gone up. Making an announcement in December increases year-end sales which helps in clearing inventory as customers don’t prefer buying previous year manufacture date vehicles in a new year,” Gaurav Vangal, senior analyst, Forecasting with IHS Markit, said.
Mahindra & Mahindra has already announced a price hike of Rs 30,000-40,000 on the recently launched multi-purpose vehicle Marazzo, saying the earlier price starting Rs 9.99 lakh was an introductory one. While, Ford India is reportedly considering increase in price from January in the range of 1-3%, a Honda Cars dealer said the hike is estimated to be in the range of Rs 10,000-Rs 25,000. Domestic passenger vehicle sales have been declining since the past three to four months. While sales fell 2.71% y-o-y in July, in August and September, it declined by 2.46% and 5.6% respectively.
Although October showed a marginal 1.55% y-oy increase in factory dispatches to dealers, a FADA member said the retail sales declined. As per Federation of Automobile Dealers Association (FADA) data, registration of four-wheelers fell by 14% in the 42-day festive period.