Tuesday, March 05, 2013
By Shilpa Chopra
Tata, Mahindra, Toyota raise prices of SUVs, other SUV makers to follow suit
It seems that SUV makers in India were waiting for the Union Budget proposals of higher tax on SUVs as almost all have increased the prices. Where Tata has increased the price of its SUVs viz. Tata Sumo, Tata Safari Storme and Tata Aria, Mahindra, Toyota and others have also put up the revised price tag on their cars. Also, this price rise is an intermediate one and this will be revised as soon as the complete assessment of impact of the revised taxes will be done. The rise in price is being enforced at a time when the market is responding feebly to even some of the greatest offers on cars and almost all the major car makers are either in red of are none better than that in terms of sales. Thus, this price rise is expected to further impact the already slow demand in the country.
Tata has increased the price of its Sumo, Aria and Storme SUVs by upto Rs 35,000 and it is believed that this is an immediate increase and a final increase will be declared soon. Meanwhile, the price of Mahindra Rexton, the most popular SUV Mahindra XUV 5OO and the best selling well established iconic SUV Mahindra Scorpio have been increased between Rs 11k to Rs 40k. The Japanese car maker has also recently declared a price rise of its MPV Toyota Innova and the SUVs including Toyota Fortuner, LC Prado and Land Cruiser.
Nobody believed that only a 3 percent rise in excise duty on big SUVs will invite so much of price appreciation. In fact, the industry was waiting for some serious measures to boost demand for cars in the country and rather than this what they got was a series of tax and duty hikes which are probable manifestations of further slowdown in demand of cars in India. Some believe that why the government taxed SUV is for this reason that the segment is increased by leaps and bounds and in the period from April 2012 to January this year, the sales of SUVs in India witnessed a jump by 57 percent.