The Hindu Business Line : Consumer electronics majors slash prices

CLOSE on the heels of the Finance Ministry announcing reduction in peak rate of customs duty by five per cent, from 25 per cent to 20 per cent, and abolition of the Special Additional Duty (SAD) of four per cent, a section of consumer electronics players have decided to pass on the benefits to consumers.

According to a Samsung India Electronics official, "The reduction in peak customs duty coupled with removal of SAD has benefited us in high-end products that are being imported. The company has reduced prices by 4-5 per cent on high-end products such as plasma, LCD projection TV, and `side-by-side' refrigerators."

Sony India also announced a slash in prices of its products across specific categories by 5-16 per cent. The price reduction in MRP will be in the range of 5 to 10 per cent for WEGA flat colour televisions, 8-10 per cent for Sony Hi-Fi Systems and 8-16 per cent for camcorders and digital still cameras.

"Sony India aims to ensure that its products retain their international edge on quality and technology while ensuring that they remain a value-for-money purchase. Our new pricing strategy will make our WEGA televisions, digital imaging products and Hi-Fi systems available to a larger consumer base in India," said Mr Mohit Parasher, Head Sales, CAV Division, Sony India Pvt Ltd.

With the implementation of the new pricing strategy, an entry-level Sony WEGA 21-inch flat CTV will be available at Rs 12,990, while the Sony Hi-Fi systems range will now start at Rs 15,990. Camcorders will now begin retailing at Rs 22,990 and digital still cameras become more affordable beginning at Rs 14,990.

However, LG Electronics India Pvt Ltd said it was not planning any price changes. Mr C. M. Singh, Head of Consumer Electronics Division, LGEIL, told Business Line, "The high-end products were under pressure as far as pricing was concerned. Hence, there is no room for further reduction."

Concurring with what Mr Singh said about squeezing margins on high-end products, Mr D. Shivkumar, Vice-President, Consumer Electronics, Philips India Ltd, said, "We have reduced prices on cell-phones, DVD and audio ranges by 5 to 10 per cent. However, there is no reduction in CTV prices." This would mean that an entry-level Philips cell phone, priced at Rs 5,495, would be cheaper by 5-10 per cent.

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