Toyota planning price hike due to increase in raw material and input costs alongside unconvincing foreign exchange rates
Toyota Kirloskar Motor has been thinking about increasing the prices of its vehicles in existing portfolio. The two main factors that could lead to the price hike are rising input costs and underwhelming foreign exchange rates. TKM’s Director and Senior Vice President N Raja told ET Auto that the increased pressure was due to appreciation of Yen and USD. Moreover, the input costs for necessary materials like steel have gone high.
The hiking plans will be reviewed following further evaluation he further expressed. A decision will be finalised by the end of this month or in the beginning of next month according to Toyota. As has often been the case, the price hike will be around two and three percent and it could be the same this time around as well. Currently, the Japanese automaker imports components from its home country and Thailand and the appreciation of dollar and yen is around 10 to 15 percent.
Hyundai increased the prices across its entire range between Rs. 3,000 and Rs. 20,000 from entry-level Eon to flagship Santa Fe earlier in August and before that two more times the South Korean brand had to step up the prices citing Union Budget with its new taxes and increase in raw material costs. Maruti Suzuki took the same route and charged customers for more between Rs. 1,400 and Rs. 35,000 for the above said reasons.
At present, Toyota Kirloskar Motor’s vehicles range from starting price of Rs. 5.13 lakh for the entry-level Liva hatchback and Rs. 1.34 crore (ex-showroom prices, Delhi) for the flagship Land Cruiser LC 200 SUV. When questioned about the consequence of the unfolding saga between Tamil Nadu and Karnataka because of Cauvery water issue, Raja stated that the brand’s Bidadi plant has been closed.
Source: ET Auto