Volvo Car India has announced its plans to raise its vehicle prices by up to 5 percent in order to offset the impact of an increase in the basic import duty in the Budget for 2018-19.
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, the company said in a statement.
"We are planning to hike prices across our range by up to 5 percent 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.
In the Budget for 2018-19, the government increased customs duty on CKD (completely knocked down) imports of motor vehicles, motor cars, motorcycles from 10 percent to 15 percent.
Further, duty on CBU (completely built units) imports of motor vehicles (trucks and buses) has been hiked from 20 percent to 25 percent.
Frump said the company would have liked to see much needed incentives for hybrids and plug-in hybrids as these solutions have an immediate impact on the environment.
"Volvo Cars' vision is aligned with the Indian government’s vision of going full electric but till we get to full electric, the interim is hybrids," Frump said.
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