Reduced sales and dipping demands have meant that three prominent auto players in the Indian market have decided to give the traditional ‘start of the year’ price hike a miss. This January, Maruti Suzuki, Volkswagen and Hyundai Motors have not increased the price of their vehicles. According to analysts, the reason for this, primarily, is falling demand for cars in the Indian market. So while, this is not such a happy occasion for the car makers, it is surely an occasion for rejoicing as far as the consumers are concerned.
According to one source, sales in the automobile industry had fallen considerably by the end of last year. While, 2.18 lakh units were sold in September 2011, sales figure during December last year stood at mere 1.59 lakh units. What made matters worse was the constant fall in the value of rupee in the international market and rising production cost. This had resulted in reducing profit margin of the companies. Any hike in price at this time, therefore, would drive the customers away from these companies.
But while the companies have not increased price of their vehicles at this point of time, it does not certainly mean that they will not raise the price of their cars in the near future. This was evident from the statement of Mr. Mayank Pareek, Managing Executive Officer of Maruti Suzuki, when he said to Indian Drives that there would definitely be a minor price hike in the near future. But the final decision on that hike is still on hold.