Automobile major Maruti Suzuki has informed that the vehicle prices will move up from January 2020. The price increase is necessitated on account of increase in input cost, says a company press release.
Factors such as implementation of more stringent safety and emission (BS6) norms, increase in vehicle insurance expenses and hike in road taxes in many states among other reasons have forced the company to implement a price hike.
As the increase in production cost was hectic, the company was forced to pass on some impact of the above additional cost to customers through a price increase.
Maruti sells both entry-level cars and cars in the premium range — such as Alto and XL6. The prices vary from Rs 2.89 lakh to Rs 11.47 lakh (ex-showroom Delhi). Maruti Suzuki India reported a drop of 39.4% in its net profit in its second quarter earnings
The company's net profit for the quarter fell to Rs 1,358.6 crore compared to the same period the previous year, largely on account of lower sales volume, higher sales promotion expenses and higher depreciation expenses.
However, cost reduction efforts, higher fair value gains on invested surplus and reduction in corporate tax rate aided the company to offset some of the impact.
Besides, the company's net sales declined by 25.2% to Rs 16,120.4 crore from Rs 21,551.9 crore reported for the same period during the previous year.