New Delhi: The country's largest automobile companies in terms of passenger car sales Tuesday hiked prices on account of the government's decision to withdraw excise duty concessions and increase in input costs.
The country's largest passenger car manufacturer Maruti Suzuki said it was increasing vehicle prices to offset higher taxes.
According to a company official, the price increase which was effective Jan 1, 2015 was intimated to its dealers Tuesday.
"The price increase was intimated today. All vehicles which are sent to dealers will be sold with new prices," the official told IANS.
Meanwhile, Chennai-based Hyundai Motor India too announced the price increase across all its models with immediate effect.
"In these adverse market conditions, the price increase is necessitated on account of the higher excise duty and increased input cost," said Rakesh Srivastava, senior vice president, sales and marketing, Hyundai Motor India.
The company has increased the prices across all models starting from Eon to Santa Fe in the range of Rs.15,000-to-Rs.127,000 effective from Jan 1, 2015.
Earlier, the NDA government in June had extended the excise duty concessions of the previous UPA government by six months to Dec 31.
In order to boost the auto sector, excise duty was reduced to 24 percent from 30 percent for SUVs, 20 percent for the mid-sized segment from 24 percent, and 24 percent for large cars from 27 percent.
However, the government did not extend the concession beyond Dec 31, 2014.
Car manufacturers had been asking the government to extend excise duty relief, to boost sales as the sector was suffering from high interest and fuel costs coupled with overall economic slowdown.