Maruti to hike car prices next week

Country's largest car maker Maruti Suzuki India (MSI) today said it is considering increasing prices of its products from next week to offset the impact of rupee depreciation.

"We will announce the price increase next week of all our products, it will be estimating to mitigate the impact of rupee depreciation and high input cost," MSI Managing Executive Officer (Sales and Marketing) Mayank Pareek told reporters at the 11th Auto Expo here.

He, however, did not specify details such as the quantum of price hike.

Sources close to development said the company will raise the prices by 2-3%.

Rupee depreciation is putting severe pressure on companies that import a substantial amount of components from overseas. The domestic currency was being quoted at Rs 52.89 per US dollar in morning trade on the Interbank Foreign Exchange today.

MSI has both direct and indirect exposure to foreign currencies while importing components. It imports about Rs 8,000 crore worth of parts annually.

In November, MSI hiked prices of its diesel cars by up to Rs 10,000 on account of higher input costs and appreciation of the Japanese yen. It raised the prices of diesel versions of compact cars Ritz and Swift, and sedans DZiRE and SX4.

The slump in the rupee comes at a time when auto-makers are witnessing a slowdown in demand.

MSI witnessed a drop in its sales for the seventh consecutive month in December, with 7.1% decline to 92,161 units.