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Old 10th February 2010, 01:40   #1
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Default Car prices may go up from 1/April/2010

I received a mailer from Concorde Motors, Chennai today that prices of Linea and Punto may go up as per the below article.

It was a routine marketing mailer which i ignored at the first instance.
While going through the article again, i felt the pain that the prices could go up if there is an increase in excise rate which is very likely in this budget.

If implemented, prices for all types of car will go up significantly depending on the percentage increase.

Source: The Economic Times
Edition: Mumbai Edition
Source: 25th January 2010

The government is considering an across-the-board increase in excise duty in the Union budget 2010-11, as it faces pressure to withdraw fiscal stimulus measures in the wake of a 16-year high fiscal deficit of 6.8% in the current financial year. "One opinion being considered is the increase in the cenvat rate by 2% while leaving the service tax rate unchanged at 10%", a finance ministry official told ET. Cenvat refers to the median excise duty, tax on manufacture of goods, levied on nearly 90% of the goods made in the country.

More services could be brought under the tax net to allow the government to keep the service tax rates unchanged, the official said, requesting anonymity. A hike in service tax rate would be an immediate burden on consumers already battling high food prices. The proposal is at an early stage and may undergo significant changes by the time the budget is presented.

An alternate proposal is also under consideration, which moots an increase in excise rates in sectors that are doing well such as automobiles, instead of an across-the-board hike.

Last edited by bnzjon : 10th February 2010 at 01:44.
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Old 10th February 2010, 02:15   #2
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The prices are expected to go up right at the start of March itself.

News of the Budget and Excise Duties from February 28 2010 - ConnectCarIndia :: Forums

Quote:
People are lining up in droves to beat an expected 4% raise in excise duties on cars in the expected February 28th budget. “We are seeing a lot of advancing of purchases this month, both among individuals and corporates. This time, customers fear that the excise duties will go up leading to price hikes”, said Mohan Mariwala, who runs Honda and Mercedes dealerships.
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Old 10th February 2010, 09:04   #3
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So in a way, this news itself is kind of a stimulus as many people are rushing to buy cars now; we are already seeing a huge increase in automobile sales in the last 2 months. This will now at least continue until march!

Economically it is good for the market.
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Old 10th February 2010, 09:10   #4
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Quote:
Originally Posted by bnzjon View Post
I received a mailer from Concorde Motors, Chennai today that prices of Linea and Punto may go up as per the below article.

It was a routine marketing mailer which i ignored at the first instance.
While going through the article again, i felt the pain that the prices could go up if there is an increase in excise rate which is very likely in this budget.
If the excise duties are increased the prices will go up the very next day after the budget has been presented.

Unlike income tax slabs where changes come into force for the subsequent financial year, excise duties are applicable with immediate effect. So if you are planning to beat the price rise buy your car before feb 27th
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Old 10th February 2010, 09:32   #5
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I'm not sure if the excise duties will go up immediately after the budget, because the excise duty that would be increased will be from financial year 2010-2011 and hence would be applicable starting from April. This is how it would work, according to my knowledge. I might be wrong. But still there is a possiblity of Auto companies cashing on this and increasing the price immediately.
Need to wait for the budget though!
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Old 10th February 2010, 09:43   #6
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I seriously do not understand the need for keeping the stimulus package going for a few and penalise the many who do not own an automobile. As it is, what this does is increase deficit (understand it on a personal level and you will understand what it does at a national level) and is a transfer of resources.

If you check out, the Indian auto industry's profitability is now near normal levels and in many cases above that.
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Old 10th February 2010, 10:02   #7
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Guys, does this means that if the car is delivered post March, I'll have to pay more? Or does this depend on the time of booking? I'm already sick of price increases in Andhra in the past one month itself!

Last edited by quadmaniac : 10th February 2010 at 10:03.
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Old 10th February 2010, 10:05   #8
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Quote:
Originally Posted by quadmaniac View Post
Guys, does this means that if the car is delivered post March, I'll have to pay more? Or does this depend on the time of booking?
Depend on when your invoice is prepared. The date of your invoice is on or after the announcement, then you stand to lose/gain.

You may book & invoice today, enjoy the price advantage and take delivery later with no effect on the price hike.
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Old 10th February 2010, 10:13   #9
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Quote:
Originally Posted by bnzjon View Post
Depend on when your invoice is prepared. The date of your invoice is on or after the announcement, then you stand to lose/gain.

You may book & invoice today, enjoy the price advantage and take delivery later with no effect on the price hike.
Thanks for the info! Now I have a doubt - Is it possible to prepare the invoice without getting the engine/chassis number or whatever? I mean, before the car is allocated in my name?

Thanks!
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Old 10th February 2010, 10:35   #10
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Quote:
Originally Posted by quadmaniac View Post
Thanks for the info! Now I have a doubt - Is it possible to prepare the invoice without getting the engine/chassis number or whatever? I mean, before the car is allocated in my name?

Thanks!
No. It will not be possible to invoice the car without the engine/chassis number. I already checked it with the dealer and they confirmed the same.
It is possible if you are going for a car which is readily available for delivery in the showroom and do the invoicing now, take delivery later! (I think nobody does that )

I fact I am also a bit worried about the price increase bacause I have booked a Chevy Beat and the date of delivery is yet to be confirmed by the dealer. They say it will take ~5 weeks!
So if price increase happens in march, I will be in trouble.
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Old 10th February 2010, 10:51   #11
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Quote:
Originally Posted by salbin View Post

I fact I am also a bit worried about the price increase bacause I have booked a Chevy Beat and the date of delivery is yet to be confirmed by the dealer. They say it will take ~5 weeks!
So if price increase happens in march, I will be in trouble.
SAME pinch for me :-) In case your's is BEAT LT, any idea how much on road difference this would lead to? Would this be an increase of 3% on the ex-showroom price?
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Old 10th February 2010, 13:13   #12
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Quote:
Originally Posted by quadmaniac View Post
SAME pinch for me :-) In case your's is BEAT LT, any idea how much on road difference this would lead to? Would this be an increase of 3% on the ex-showroom price?

I'm already sick of price increases in Andhra in the past one month itself!
As per various news resources, the increase can be anyehere between 2% to 4%.
So I assume the impact will be ~7000 to 14000 for LT, if the news is true.
Any way let's wait and hope for the best.

States like Andhra and Karnataka are charging heavy (more than double)on the road tax compared to other states. So it is the same case with me too..
BTW what colour did you select?
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Old 10th February 2010, 13:30   #13
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I am asking this question on behalf of a friend of mine. He happened to book a GP last Nov 09. The delivery as expected was delayed and in the meantime Fiat increased the GP price. Consequently the dealer called him up and asked him to pay the extra amount which is the increase in price. Is this a valid request?
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Old 10th February 2010, 13:38   #14
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Fiat recently increased prices of Linea and Punto. Yet another increase may not be accepted so well. Best is to buy your car in March when discounts will be good too.

@falcon009 - It all depends on whether the invoice was made prior to price increase or just booking.
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Old 10th February 2010, 16:53   #15
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Even Hyundai is going to increase their prices. I heard it will come in effect next week itself. That is what the Marketing person (who lives in my apartment) of a dealer told me. Next i will ask her the % increase and post it here.
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