Telco To Raise Sumo Output, Prices To Go Up By 20%

The Rs 10,097 crore auto major Telco is all set to increase production of its utility vehicle, Sumo, by 20 per cent.

The decision comes in the wake of increasing domestic demand for the product. Last year, Sumos market share rose to 31 per cent from 22 per cent.

Telco has also increased Sumo and Sumo Deluxe prices with effect from June 9. The ex-factory price of the Sumo is up Rs 7,500, and of Sumo Deluxe Rs 10,000.

The on-road prices will inc-rease by Rs 12,000 for Sumo and Rs 15,000 for Sumo Deluxe, industry sources said. The on-road price for Sumo in Mumbai is Rs 4.18 lakh and for Sumo Deluxe Rs 4.8 lakh.

 

Keeping in mind the excellent demand and wide acceptance we have decided to increase the production of Sumo substantially, a Tata source said. Telco produces 65,000 Sumos a year and proposes to increase production of this vehicle to 83,000 units a year by the end of 1997.

Sumo commands an 80 per cent share of the market for urban utility vehicles. However, it does not have a presence in the rural market where Mahindra & Mahindra is the leader. Overall, M&M has a market share of 52 per cent in the utility vehicles segment. Sumo sales in 1996-97 were impressive with its market share rising to 31 per cent from 22 per cent.

The Telco board is scheduled to meet soon to review production. Although Tata sources denied any move to cut production of heavy commercial vehicles (HCVs), industry sources say Telco could follow the example of Ashok Leyland and cut production of HCVs and some LCV models by 10-15 per cent.

Telco currently produces around 120,000 HCVs a year. In 1996-97, Telcos HCV sales crossed 100,000 units. The HCV segment comprises 46 per cent of Telco overall sales and the Tata auto major has a commanding 72 per cent share of the Indian market for HCVs.