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Car Makers Refrain From Price Hike For The Eighth-Straight Month
Automobile manufacturers in India refrained from price hikes for the eighth-straight month. This is to encourage more people to buy cars and help car makers sell more units.
Car manufacturers such as Maruti Suzuki, India's largest car maker has not increased prices for any of their models since December 2013.
The South Korean automobile manufacturer, Hyundai, had last increased prices last February. That was before the government reduced excise duty.
The 4 – 6 percent cut in excise duty in February, increased demand and helped the government take control of the industry on prices. This helped the industry to overcome two years of declining sales and helped sell more cars in the first half of this financial year.
Amit Kaushik, principal analyst at IHS Automotive, a global consultancy firm said, The decade's worst slowdown has pushed the automakers to rethink about their overall game plan in India. Moreover, the pricing strategy is something which is generally a counter to revelry and currently none of them are willing to weaken down their positioning in the recovering market."
The recovered market managed to sell 8.8 lakh passenger vehicles during the April – September period, which is a 4.09 percent increase from a year ago.
Speaking about the situation, a senior executive from Maruti Suzuki said, "Discounts are on an average around 20 per cent higher over the last year. But still we avoided any price hikes this year as it could have derailed consumer sentiment and also there was a moral pressure to pass on the benefits of excise duty reductions to customers."
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