Just three months after increasing prices across its entire car range, Toyota Kirloskar Motor (TKM) plans to hike price again. The carmaker will hike prices across its range by up to 2% from January to offset the sharp hit it has taken on its margins on the back of adverse currency movement and a slowdown in market demand.
Sandeep Singh, deputy MD for marketing at TKM, said, ?We are planning to hike prices by 1-2% in January as we have been hit by the rupee depreciation and yen appreciation. We are also getting aggressive on exports and identifying new markets ? the strategy for next year will be clear in a month.?
TKM had increased prices by a similar 1.5% as early as this September, which followed another hike in May of up to 2%.
Toyota?s domestic operations are impacted largely because of a high reliance on imported components. While demand has shifted in favour of diesel cars, TKM continues to import diesel engines for the Etios, Fortuner and Innova from Thailand and Japan. What may be considered ill-timing, TKM recently set up a local petrol engine plant at Bangalore, but has not been able to utilise the full annual capacity of 1.1 lakh units.
From January, TKM?s expansion plans will see car manufacturing capacity going up to 3.1 lakh units a year across two plants, from 2.1 lakh units. In comparison, FY13 sales are expected to end only at about 1.7 lakh units, up 13% from 1.5 lakh units in FY12.
