Prices have been increased across the border as well sighting the same reasons that automakers here have made an excuse to increase the prices. Foreign currency fluctuation and rising input costs. But while here, car prices are being played with like oil prices with constant blame being put over imports, over there, it’s a different story.
While Maruti Suzuki has increased prices by only Rs 2,500 to Rs 5,259 depending on the models which would be a barely noticeable amount however, Maurti Suzuki‘s Chief Operating Officer said,”There is a lot of pressure on our margins due to the foreign exchange fluctuation and rising input cost.,”
To manage and bring the prices down to older levels, the company has said that in order to counter the impact of adverse currency movement, it is targeting to reduce its forex exposure by nearly 65 per cent to USD 600 million by March 2015 for which it is working with its vendors to reduce imports.
Moreover, it is looking out for new markets to increase exports of its products to mitigate impact of unfavorable foreign exchange fluctuation.
Rest of the Indian automakers have also increase prices or are in the process to increase them but they are also taking measures to battle the reasons, prices have to be increased so they don’t have to loose precious sales.
Our auto assemblers can also learn something from Maruti Suzuki and lower down their foreign currency exposure to as low as possible by reducing imports but they have completely disregarded the ‘Deletion policy’ which speaks of increasing localization and reducing imports. Through this, prices can be reduced significantly.
In their own words, there’s a cure for the cancer of auto imports.