There has recently been a slowdown in the numbers of the cars being sold per month in India and the automakers have rolled out a new strategy of announcing a price hike in the near future to attract customers. The same strategy played by a single company has attracted others to follow suit. Carmakers like Maruti Suzuki, Volkswagen, General Motors, Honda, Hyundai, and others have justified their reason of hiking the prices by pointing out to the increasing pressure on operating margins.

While the true story behind the scenes appears to be poor market for the cars, especially the petrol variants. There are discounts being offered on cars like Wagon R, Estilo, Ritz, and SX4 in Maruti Suzuki up to Rs 25,000. Hyundai’s benefits add up to almost twice as much. The others have different schemes for the unnoticing customers.

A car dealer explains that the strategy was a measure introduced to increase sales of the model of the year. A user generally waits to purchase a car in Jan for a new model of the same car instead of getting a car likely to get upgraded in a month or two. Companies on the other hand capitalize on the same, increasing prices in Jan while offering discounts in December to clear out their inventories for the year.

(AW- Anil)