Automobile manufacturing companies plan to increase prices by up to Rs. 10,000 for compact vehicles and Rs. 25,000 for saloons for offsetting the impact of weakening rupee on import costs, despite the recent slump in sales. The executives of the company said that Skoda, Maruti Suzuki, Honda, Toyota and GM also plan to raise prices within days because the weakening rupee has pushed up costs of their imported parts significantly. It has destabilized approximately 17 percent against United States dollar since January, hitting all time low Rs. 52.73 last week. It has forced the automakers that import between 40 percent and 10 percent of components for various models for considering price augments.
A Senior Executive at Maruti Suzuki said that they will have to pass on the cost to discerning buyers for offsetting the growing impact of weakening rupee and increasing cost of producing diesel models, which are at present selling like hot cakes. Luxury car manufacturing companies like Audi, which imports completely produced vehicles for feeding local market are also expected to raise prices by Rs. 50,000. The Indian automotive industry has been the cruise with sales increasing at high double digit figures since 2 years, eventually falling in current fiscal year and before slowing down. There has been augmented competition in the market with international companies speeding up to the 2nd quickest growing car market of the world, launching plethora of made for India and new cars at highly competitive or reasonable prices.