Honda Atlas Cars has announced that it will increase its car prices by Rs60,000 to Rs100,000 due to the rupee depreciating against the US dollar from August 10.
Following the new hike in Honda cars price, Honda City’s different variants have become Rs60,000 to Rs70,000 more expensive as City’s top variant 1.5L Aspire AT will be selling at Rs2.86 million.
Honda has cited the rupee devaluation as the reason behind the hike in its car price.
“Due to the current forex situation, it has become difficult for Honda Atlas Cars to further absorb the exchange rate impact and is compelled to consider some part of its impact in price,” Honda Atlas Cars wrote in its price increase notification to its dealers.
The last time Honda increased its car prices was on May 5. The company cited the rupee’s devaluation from Rs155 to a dollar to Rs167 as the reason.
A research analyst said that previously, Honda increased its car prices without completely factoring in the dollar appreciation apparently expecting that the dollar may come down to around Rs162 but it didn’t. So, now they have increased cars price again.
Analysts say when the dollar becomes expensive, carmakers increase prices because they import up to 60% of their parts, which are paid for in dollars.
The price increase will be effective August 10. The company has said that people can buy cars at the current prices if they make full payments by August 8.
Another Honda sedan, the Civic variants cars, will see their prices jump by Rs80,000 and Rs100,000, while its compact crossover SUV BR-V variants’ price will increase by Rs80,000.
Honda Cars recently reported a loss of Rs511 million, which translated into Rs3.58 loss per share for a three-month period that ended June.
However, Honda Cars’ share price on Thursday increased from Rs284 to Rs295, a change of Rs11 and it had the most traded share in the auto sector with over 766,000 shares traded when this report was filed by noon.