The global car makers GM, Ford and Toyota have fallen to the state of hiking the prices of their vehicles fourth time in a row. They seek to sustain the profitability transiting from cheap demand and the force behind the rise is the commodity prices. The proposed hike may be in the range of 0.5% – 3% at Rs1500- Rs20000 in the capital city. Another reason cited for the rise is fluctuation in currency particularly Yen and Dollar, said the deputy MD of Toyota Kirloskar. Toyota’s utility car Innova is to cost Rs10000 more and its Corolla Altis sedan may see the rise by 1.5% accounting Rs15000 and the new prices will come into force from next week, it is learnt. The sale has been agog since last year and the auto makers are capitalizing on this demand. However, the rise in price is shouldered on the customers. The sale increase is mainly due to the easy availability of finance from
banks and financial institutions.
The carmakers are firm sure that the demand will not slip down despite the hike in price. There has been a different story for the vehicles which make
the customers wait for a longer period – Maruti Swift for example. This has been happening since the first increase and the sale has increased by 33% and the net sale in 2010 fiscal is up by 25% making the volume to 19.5 lakhs which is deemed to be the fastest in the last six years. This growth rate of cars in the Indian market has prompted major global players like VW and Peugeot to invade India. M&M’s version too indicates that the rise in price will not deter the sale and demand of cars. M&M is yet to come out with its rise level. In the meantime, GM has announced a 3% hike to its cars by which its Cruze sedan will cost more by Rs14500.Tata Motors and Ashok Leyland have raised the price by 2% to their cars and trucks.