Volvo Cars to increase prices in India by up to 5% to offset import duty increase
Volvo Car India plans to raise its vehicle prices by up to 5% to offset the impact of increase in the basic import duty in the Budget for 2018-19. In a statement issued on Friday, the company said the prices will be revised for the new stock which is in the pipeline to be custom cleared as the new duty structure increase will not allow costs to be absorbed.
"We are planning to hike prices across our range by up to 5% as a direct impact of duty announced at the union budget," Volvo Car India Managing Director Charles Frump said. The increased duty comes as a surprise and will have a short term impact on the automobile industry, he added.
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In the Budget for 2018-19, government increased custom duty on CKD (completely knocked down) imports of motor vehicles, motor cars, motor cycles from 10% to 15%. Further, duty on CBU (completely built units) imports of motor vehicles (trucks and buses) has been hiked from 20% to 25%.
Frump said the company would have liked to see a much needed incentives for hybrids and plug-in hybrids as these solutions have an immediate impact on environment. "Volvo Cars' vision is aligned with the Indian governments vision of going full electric but till we get to full electric, the interim is hybrids," Frump said.