Hero MotoCorp to Hike Prices by Upto Rs 2,000 on its Range From January 4, 2022

Hero MotoCorp has announced that it will hike the prices of its scooters and motorcycles by up to Rs 2,000 from January 4, 2022. The company stated that the hike is to partially offset the impact of steadily increasing commodity prices.

India’s automobile industry expects continuation of healthy demand along with easing of semiconductor supply issues during the upcoming year.

However, speed breakers such as third Covid wave triggered via spread of Omicron variant in India as well as rising commodity prices might deccelerate the industry’s recovery.

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“Auto industry is hopeful that the new variant of Omicron of Covid-19 will not play a major spoil sport. We are hopeful that once the semiconductor crisis eases out, the industry can continue to witness strong demand and do better in 2022," said Rajesh Menon, Director General, Society of Indian Automobile Manufacturers (SIAM).

“The Industry is hopeful that the favourable policies of the government for instance the PLI schemes for auto and auto component sector, advanced chemistry cell, extension of FAME-II scheme till 2024 and the announcement of a PLI scheme of Rs 76,000 crore for semiconductor manufacturing will provide the much-needed fillip to the industry."

Lately, rising commodity costs have driven up automobile prices.

Similarly, the semiconductor shortage has extended the waiting period along with escalated prices.

At present, semiconductors play a critical part in the production of internal combustion engines. They are an integral part of all kinds of sensors and controls in any vehicle.

“We see year 2022 as a neutral year as the rise of Omicron has once again created fear globally," said Federation of Automobile Dealers Associations (FADA) President Vinkesh Gulati.

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“This may further impact the supply in passenger vehicles if chip making countries go under lockdown or prioritise chip making for electronics used for ‘work from home’.

Besides, Gulati said the two-wheeler market which continues to face demand headwinds may further go into slump, if the third wave becomes a reality.

“We anticipate that H2 of CY 2022 may see supply as well as demand slowly coming back to normalcy. As mentioned earlier, Auto Industry may fully recover only by 2023 and come back to its pre-covid levels if covid becomes a history."

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