Japanese car maker Toyota announced its second price hike this year, citing losses owing to the devaluation in the value of rupee against the US dollar. Earlier in June this year, Toyota Kirloskar Motor (TKM) announced a hike of 1 per cent, but later the company revalued the increase to 1.5 per cent.
Expressing his views on the hike, the Deputy Managing Director (Marketing) of the company, Sandeep Singh quoted, “The rupee depreciation has hit us very badly and it is affecting our margins. We are trying to hold this as far as possible. We are forced to pass on the burden partially to our customers”. He also added, “Although we have not finalized the quantum of the hike, it will be around 1.5 per cent”.
At present, Toyota’s compact car Liva comes within a price range of Rs. 4.10 lacs to Rs. 6.32 lacs, while the Etios sedan is priced between Rs. 5.14 lacs and Rs. 8.23 lacs. Considering the price of Innova Multi Utility Vehicle (MUV), the base model is tagged with a price of Rs. 8.98 lacs, whereas the top-end model is offered with a consideration of Rs. 13.72 lacs. Toyota’s premium sedan, Corolla Altis is priced between Rs. 11 lacs and Rs. 15.43 lacs, whereas the base model of Fortuner Sports Utility Vehicle (SUV) is offered for Rs. 20.89 lacs and the top for Rs. 22.04 lacs (all ex-showroom prices of Delhi).
Apart from manufacturing its vehicles on domestic turf, the auto maker is also involved in several kinds of auto imports and exports. Hence, INR depreciation imposes significant losses to TKM, a Joint Venture (JV) between Japan's Toyota Motor and Indian Kirloskar Group. The imports of TKM include several critical components such as engines and transmissions, which are installed in the company’s different models.
With the scheduled price hike, TKM is aspiring to recoup for the losses and is also aiming at some financial foothold before the end of Indian festival season, when most of the car makers offer several goodies and freebies.
