Toyota raises car prices by up to Rs350,000 from Jan 2019

Decision comes after 7% devaluation of rupee against US dollar

KARACHI: Indus Motor Company (IMC), which had recently stopped car bookings, has made a massive increase in vehicle prices following the recent round of rupee depreciation.

The company has raised prices in the range of Rs50,000 to Rs175,000 for November and December deliveries and Rs100,000 to Rs350,000 for deliveries from January 2019 onwards.

Indus Motor announced that it would be absorbing 100% impact in the case of vehicles for which full payment had been made and deliveries were scheduled for October and November.

The company will also bear 50% of the price increase for deliveries tentatively scheduled for November and December.

"It is extremely difficult for IMC to hold current retail selling prices and therefore, we are compelled to pass on part of this impact to the market," the company said.



The rupee's depreciation of over 26% against the US dollar in the past 10 months has left a devastating impact on many businesses, particularly the ones that rely heavily on imports.

Toyota has increased Corolla XLI price by Rs50,000 and the price will rise another Rs50,000 in January. First, its cost will rise to Rs1.994 million and then cross the two-million mark with a tag of Rs2.044 million in January.

Prices of other Corolla variants have been raised in the range of Rs50,000 to Rs100,000, which will double in January.

IMV-4 4X4 has become expensive by Rs175,000 with a price of Rs6.624 million while its cost will increase to Rs6.799 million in January.



Other variants of the model have also faced a price hike of between Rs125,000 and Rs150,000, which will double in January.

"We have devised this price strategy to give relief to customers. We are actually absorbing the impact (of rupee devaluation)," IMC CEO Ali Asghar Jamali told The Express Tribune.

JS Research analyst Ahmed Lakhani said the price hike in two phases would result in increase in sales of the company in the short run as people would buy early because prices would go up again in a few months. He added that he expected other auto companies to increase car prices as well.

This is the fourth time this year Indus Motor has increased car prices following the rupee depreciation, which began in December 2017. Suzuki has already raised prices four times and is expected to increase prices again following the 7% rupee depreciation. Honda has so far increased car prices three times.