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Skoda Car Prices Increase: Effective Date, Price Hike Details, Models & Loyalty Bonus
Skoda Car Prices Increase From March 1, 2018
Skoda Auto India has announced that it will increase prices of its product lineup in India. The Skoda car price increase will be effective from March 1, 2018, across its entire model range. Skoda said that the price hike of its cars is a result of a revision in the customs duties announced in the Union Budget this year. The carmaker will increase prices of its cars in a phased manner to lower the overall impact.
Skoda says that the price of its cars will go up by 3 to 4 percent depending on the model and variants. As of March 1, 2018, Skoda car price will increase by one percent, which results in a hike of Rs 10,000 to Rs 35,000 depending on the model and trims.
In the recent Union Budget, India's Finance Minister Arun Jaitley proposed increasing the customs duty on vehicles that are not entirely made in India. These cars are usually built utilising kits produced outside of India, and they are finally assembled in India. The customs duty on these vehicles has been hiked from 10 percent to 15 percent.
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On an average, Skoda has a localisation level of 55 percent across the model range. The carmaker is looking to increase it to 60 percent in an effort to expand its current market share of 2 percent to 5 percent. With lower localisation levels, any increase in customs duty rate will be passed on to customers.
The carmaker has decided not to pass on the full burden to car buyers for now. Skoda has chosen a multi-step method for implementing the price increase. The carmaker will initially increase the car prices by one percent and will go up to 4 percent, which could go up to Rs 1.5 lakh.
Currently, Skoda has a localisation level of nearly 55 percent across their product lineup. The carmaker imports engines and gearboxes that are assembled at Skoda's plant in Aurangabad, Maharashtra. Skoda though is looking to increase the localisation to 60 percent to achieve a market share of 5 percent from the current 2 percent.
Additionally, Skoda has announced the introduction of a new loyalty bonus of up to Rs 50,000 for existing Skoda owners who are lookingro to buy another Skoda vehicle.
DriveSpark's Thoughts About Skoda Car Price Increase
The increase in Skoda car prices due to hike in customs duty will ensure manufacturers in India make the best use of the Make-in-India campaign which leads to higher employment. But most of all, the car prices will be relatively low compared to an imported or assembled vehicle.
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