Want to know why your car would cost more from 1st Jan? Here’s why!

Car companies are raising their prices. Maruti Suzuki announced a hike of Rs 20,000 across models and Hyundai Motors did the same by Rs 4,000 to Rs 30,000. Honda Motor, Renault, Nissan Motor, Toyota Motor, Audi, Mercedes-Benz and BMW have also said they’ll raise prices from January 1^st.

So what went wrong? The one to blame is unfavorable currency exchange rates and there couldn’t be a worse time. The automobile market is improving, and the last price hike came half-a-year back.

So why couldn’t the car companies increase prices and then let us know? Simple, that’ll get their ‘New Year discounts’ more attention. Most car manufactures are also trying to get rid of old stocks. As 2016 rolls in, who’ll want to buy old stock, come on! But think of it this way, you’re getting 10-15% higher discounts than last year.

But wait, what happened to #MakeInIndia? Why are car prices rising when commodity prices are at record lows (Bloomberg Commodity Index is trading at a 16 year lows)? Companies are making good money as well, after all their gross margins are at decade highs. Even the international prices of steel, aluminium and copper have fallen 50-80% from back in 2007! To phir problem kya hai? (So what’s the problem?)

RS Kalsi, Executive Director of Sales and Marketing at Maruti told ET, "Dollar has started depreciating again, making our imports costlier. We signed a new wage agreement this year, so the administrative cost has gone up and there has been some tweaking to local taxes, which has led to a spike in cost," he said.

That could only mean companies across the board are doing the same. The money is going into higher wages and #ImportIntoIndia.

To sum it up, as you thought rate cuts and slipping fuel prices would make it easier to get that car you’ve been salivating over, you better hurry mate! It’s just a few more days to New Year.

Image credit: Indiatimes