General Motors India, the domestic arm of American auto maker, has officially announced the hike in the prices of its entire model line up with effect from October 1, 2012. The reason cited behind this surge is to offset the increasing cost of inputs and unfavourable fluctuations in the value of currency.
The Vice President of General Motors India, P Balendran said that the company has not yet decided the degree of price hike as the calculations are still in progress. In India, the car maker offers a number of models, placed in almost every segment of the Indian auto industry. The entry-level hatchback Spark is offered at a price of less than Rs. 3 lacs and the range then goes to around Rs. 24 lacs with Captiva, the premium Sports Utility Vehicle (SUV).
The announcement of increase in prices is not new as Toyota, heading the bandwagon, earlier declared a price hike at its entire line-up from September 1, 2012 by 1.5 per cent. Reason cited by the car maker on this move was the fluctuations in the value of rupee, which was not favourable for the auto company. The league was then joined by Honda Cars India and Maruti Suzuki India Limited, which declared plans to surge the prices of their existing models. Honda will be increasing the prices of its three models, including Brio hatchback, Jazz premium hatchback and City sedan by around 2.6 per cent from October 1. Both of these companies cited the same reason stated by General Motors for the increase in prices in their portfolio.
Justifying the move taken by Maruti Suzuki India Limited, the company's Chief Operating Officer, Marketing and Sales, Mayank Pareek, said, “There is pressure on our margins due to the foreign exchange fluctuation. We’ve to take a call on the prices.”
