CV,tyre makers cut prices but remain unsatisfied

R Seshasayee,managing director,Ashok Leyland said,We will pass on the benefit as and when the reduction will be applicable but the demand for CVs in the country is unlikely to pick up with this excise duty reduction. Demand for CVs,he explained,is driven by construction,road development, mining activities etc so a jump in demand was unlikely unless the real economy picked up. Financing at cheaper rate for purchasing vehicles is still an important issue to be addressed, he added.

A spokeperson for Indias leading CV manufacturer Tata Motors also confirmed that the company would pass on the benefit to customers though the actual quantum by which truck prices would be cut was yet to be determined. We will pass on the benefit to the customers. In the third quarter,the company undertook some production cut and now our inventory is at a manageable level, said PM Telang,executive director of Tata Motors commercial vehicles business unit.

Ravi Santhanam,managing director,HML,said,This move will certainly help in increasing demand. HMLs mini trick the Shifeng Winner will cost Rs 3.83 lakhs,down from Rs 3.90 lakh. While the details are still being worked out,the excise cut is also likely to bring down the price of the Ambassador.

Additionally,HML would be passing on the duty cut benefit on castings and forgings that it supplies to the original equipment manufacturers and spare parts prices will also come down. The excise duty cut will have a positive impact on the taxi Ambassador cars sale as well since the 10 per cent excise duty refund would now go up to 12 per cent. HML is verifying the details of the governments announcement with SIAM.

Tyre manufacturers Apollo Tyres and Ceat Tyres have also reacted positively to the duty cuts. Apollo Tyres have also slashed the prices of all commercial radial and cross ply tyres with immediate effect. We should all support this proactive move by the government, said Onkar S Kanwar,chairman and managing director,Apollo Tyres. Ceat Tyres also reduced prices across all categories by 2 per cent with immediate effect.

Auto component manufacturers though continue to be dissatisfied with the new cuts. Vishnu Mathur,executive director,Automotive Component Manufacturers8217; Association ACMA said,This is a positive move,but will make marginal difference. Our supplies to OEMs will not be affected by this as we attract Cenvat credit. There could be very little impact on the after-market sales depending on whether abatement rates are reduced.