The Hindu Business Line : Skoda announces price cut; Hyundai plans to raise prices

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New Delhi March 1 Taking a cue from the steel and cement industry, volume carmakers have indicated plans to jack up prices, with some exceptions. This is following the tax initiatives announced in the Union Budget. While carmakers Maruti, Hyundai and Tata Motors have announced their intention to increase prices of their vehicles, Czech carmaker Skoda on Thursday announced a reduction of up to Rs 24,000 across its various models.

"We have been reviewing the price implications with the recent Budget impact. A reduction up to Rs 24,000 is expected across various models with effect from March 1," Mr Karsten Bogun, Managing Director, SkodaIndia said in a statement. The price decrease is on account of the peak rate of customs duty declining from 12.5 per cent to 10 per cent. This would impact car models with high import content.

Honda Siel which had indicated a price increase of Rs 10,000 on its fully imported model, the CR-V, says that it is still working out the exact impact on other models which are assembled locally, but carry a high import content. "Such models include the Civic, Accord and City. However, we are still studying the exact impact on the pricing of these models," Mr NK. Goila, Vice President, Honda Siel said.

Meanwhile, Hyundai Motors said it would increase prices of all its models on account of the rise in education cess. Though Hyundai did not give an indication on the exact quantum of increase, it said the company was working on it and a hike could be expected by the middle of this March.

"Due to the one per cent increase in education cess in the Union Budget, Hyundai cars would cost more to the end consumer," Hyundai Motors India Managing Director Mr H.S. Lheem said in a statement.

The company would increase the prices after it clears all existing bookings, he said, adding it would absorb the additional costs till then. It could not be ascertained whether the price increase would also be applicable on its models (such as the Sonata), which have a high import content.

Maruti had on Wednesday announced its decision to hike prices from March 15, while other companies such as Ford were taking stock of the situation to review prices.

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