Honda increases prices by up to Rs38,000

High cost of production and weak rupee blamed for the rise.

LAHORE: Following Toyota and Pak Suzuki’s footsteps, Honda Company Limited has increased the prices of its models by Rs25,000 to Rs38,000, mentioning the depreciating local currency and cost of production as the reasons behind the move. 

According to the new prices, implemented from the 10th of this month, City MT with the increased price of Rs25,000 will be sold at Rs1.39 million. City Automatic’s price is Rs1.53 million now.

Civic i- VTEC (MT) and Civic i-VTEC (PT) will be sold at Rs1.75 million and Rs1.87 million respectively. The price of VTI ORIEL (MT) is Rs1.9 million while VTI ORIEL (PT), with an increase of Rs38,000, is being sold for Rs2.02 million.

General Manager, Sales and Planning Honda, Ayyaz Hafeez told The Express Tribune that almost 50% high value parts of the vehicles are being imported.

Pak rupee, Japanese yen and Thai baht have significantly weakened against the US dollar over the last few months and this situation has been affecting the company. Now after careful deliberation, the company has decided to go for a rise in car prices, he said.

“Honda car prices were fixed when one US dollar rate was 86 Pak rupees. We have raised nominal prices of our cars. Only up to 1.8% of the total cost,” Hafeez said.

It is important to mention here that last month Pak Suzuki had raised the prices of its car models by up to Rs30,000. Suzuki official Mudassar Ahmad said that they had increased the prices of their models due to the rise in the value of US dollar.

“When dollar takes its flight, it affects all spheres of car manufacturing. In such a situation, price rise remains the only option and we took this decision as our last option,” he said.

Similarly, around three weeks earlier, Toyota Company had also issued the new price list of its cars. The increase ranged between Rs30,000 to Rs50,000.

Jail Road Traders Association Secretary Zafar Iqbal Goraya demanded the federal government to take notice of this unnatural price rise.

“Want of new cars within the middle class is already waning due to a shaky economy and growing inflation. Well-off people can easily afford to purchase cars even at higher prices but the problem lies with the middle-class. The latest rise will force the middle class away from the market,” said Goraya.

Published in The Express Tribune, October 13^th, 2011.