As the year is drawing to a close, several manufacturers have announced a hike in the price of their vehicles. Previously, Maruti Suzuki had announced that they would be hiking the price of their vehicles from January 2021. Later, Renault, Hyundai and Kia and even Mahindra announced a price hike on their vehicles effective from January 2021. Now, Volkswagen too have announced that they will be increasing prices across their model line-up by up to 5%. The price revision will be effective on the vehicles from January, 2020.
Price revisions towards the end of the year has almost become a norm in the automotive industry. Almost every manufacturer marginally increases the price of their vehicles at this time of the year or by the first month of the coming year. This price hike will be applicable only for the Polo and Vento, both of which are locally-made cars. Meanwhile, the T-Roc and the Tiguan AllSpace are unaffected by this price hike as they are come in as CBUs.
This price hike comes about due to increasing input costs across the spectrum, including input costs for steel, aluminum, plastics and other affiliated cost increases during the COVID-19 pandemic. This year, prices anyway saw a strong uptick due to the transition to the BS6 norms. The lockdown and the pandemic also caused supply-chain disruptions for components and raw materials, which further contributed the uptick in prices of vehicles.
Although it has not been announced officially yet, we expect a similar price hike for VW's sister company in India. Skoda could also be increasing the price of the locally-made Rapid sedan by a similar margin. Earlier in November, VW Group's luxury brand Audi also announced a price hike across its range.
Going ahead into 2021, both Volkswagen and Skoda will be going into a product offensive strategy. The first model to come out of VW Group's India 2.0 Project will be the production-spec Skoda Vision IN which will then be followed by the Volkswagen Taigun. These two are very important products for both the brands in India. The later half of 2021 will also see the next-gen Vento from Volkswagen and the next-gen Rapid from Skoda in India.