Latest Car News in India

Wednesday, December 14, 2011

By Pranjal Gera

Maruti cars to see price hike, Gujarat unit plan postpone

Maruti Suzuki India is another victim of increased cost of raw materials and lower margins that have led the company to announce an increase in the prices of its cars. Apart from this, due to a slight down fall in the Indian financial system and low demand of its cars, it has also suspended its current plans of setting up production unit in the state of Gujarat.

Chairman at Maruti Suzuki India, Mr. R C Bhargawa said that the company may rethink at the recently announced sizable investment in Gujarat and the firm might delay the same by six months, as the company is looking for the right time of the investment.

The declining Indian rupee against US dollar and high input cost has forced Maruti Suzuki India to increase the cost of its cars from January 2012 onwards. Till now, exact increase in the percentage is not declared by the firm.

The Sales and Marketing Officer at Maruti Suzuki India, Mr. Mayank Pareek said that the year 2012 is sure to bring in positive growth in sales and consumer demand as the year 2011 has been awful in terms of sales and internal issues faced by the company. The company is aware of the fact that Indian rupee might fall a bit again next year, and the price hike in its vehicles will be announced in January 2012, Mr. Pareek added.

In the year 2011, Maruti Suzuki India witnessed repetitive strikes at its manufacturing units that caused production and financial loss, after it resumed the production the sales could not pick up as there were number of petrol hikes along with increase in rate of interest that led consumers to postpone their car buying plans. After which the declining rupee and rise in the input cost has left no choice with the company but to go for an obvious hike in the prices of its products.

Maruti Suzuki India dominates the auto sector with its hatchback vehicles like Maruti Wagon R, Maruti A-Star, Maruti Swift, Maruti Ritz and Maruti Zen Estillo along with small car Maruti Alto. In the mid-size car segment it retails Maruti SX4 and Maruti Swift Dzire sedans.

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