BUSINESS

Hyundai may raise Santro prices

HYDERABAD, APRIL 24. Prices of the popular B segment car Santro are likely to be raised by 2.5 per cent to 4 per cent in the first week of May, which translates into Rs. 7,500 and above. An indication to this effect was given by B. V. R. Subbu, President, Hyundai Motor India, at a press conference held here to announce the launch of its latest offering, Elantra, in the Andhra Pradesh market.

Mr. Subbu said the company had been reworking pricing mechanism, taking into consideration the changes in customs duty, rupee appreciation, and the rising steel prices.

The company has finalised only recently the long-term steel prices. While steel prices impacted the car pricing, the competition's scheme offering incentives on car sales had also impacted their ability to increase prices in the last few months, he conceded.

The last time Hyundai raised the price of Santro was in May 2003 by about Rs. 11,000.

The company stuck to its stand of not reducing prices, despite concessions by competition, because of the quality of its product which was the same as the car made available internationally, he said. It had exported 40,000 cars last year, and was targeting 70,000 cars this year. He said 85 per cent of these sales were in Europe and North America, and that 90 per cent of their exports were Santro cars.

Hyundai was investing $220 million to expand the manufacturing capacity to 2.50 lakh cars annually from 1.50 lakhs and once this was completed by July-end, it will start looking at productionising its proposed offering Getz. The latter is slated to be launched in India in July-August.

Last year, it sold 1.51 lakh cars, and this year it expects to sell 2.10 lakh cars and step it up to 2.30 lakhs by 2005. Simultaneously, its service network will be expanded to 700 by the year-end (including 180 dealerships), and 1,000 centres by 2005 end, he said.

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