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BENGALURU (Reuters) – Maruti Suzuki India, the country’s most sensible carmaker, raised prices for its models by 0. 45 percent on Tuesday, well below its January increase last year, signaling a slowdown in demand for its cars.
Maruti and his peers had said in late 2023 that they planned to raise prices starting in January due to emerging commodity prices.
The company, majority owned by Japan’s Suzuki Motor has struggled with sluggish sales in the small car segment, as the income levels of its traditional customers failed to keep pace with the escalating prices of goods ranging from cars to consumer products.
Analysts expect passenger vehicle sales to grow about 5% this fiscal year and slow further in the next fiscal year, following a surge in sales last fiscal year driven by pent-up demand due to COVID.
Sedan maker Swift increased an average of 1. 1% across its entire car lineup in January last year, more than double the last increase.
Indian automakers raise the costs of their vehicles every year in January after trying to trap consumers with seasonal discounts.
Considering the year-end, coupled with low demand for entry-level vehicles, Maruti increased discounts on its lesser-priced models by 40-45% in December 2023.
Still, sales of its smaller cars such as the Alto and Celerio fell 29% in December from a year earlier, in part due to Maruti’s moderation in wholesale sales.
Maruti’s total sales between April and December were up 8. 5%, down from 26% last year.
(Reporting via Reporting by Varun Vyas and Nandan Mandayam in Bengaluru)