Mercedes to hike price by up to Rs 3 lakh

[1]

Mercedes Benz India on Thursday said it will hike its product prices by up to Rs 3 lakh expressing disappointment over high duties imposed in the Budget.

"The Budget is very disappointing for us. We were hoping for some reduction in taxes for large vehicles instead of hiking it further," Mercedes Benz India Director (Corporate Affairs and HR) Suhas Kadlaskar told.

The premium car makers usually bring in advanced technology in to the country and this step will be very counter productive, he added.

"We are going to pass on the additional burden to customers. We have not decided the exact amount yet, but on an average it will vary between Rs 2 lakh and Rs 3 lakh," Kadlaskar said.

Finance Minister Pranab Mukherjee hiked the excise duties for petrol cars with engines under 1,200 cc and diesel cars with engine capacity under 1,500 cc, but the length exceeding four metres to 24 per cent from 22 per cent and a fixed duty of Rs 15,000.

Petrol and diesel driven vehicles having length exceeding four metres and engine capacity of over 1,200 cc and 1,500 cc respectively will now be charged with an ad valorem duty of 27 per cent, instead of the earlier 22 per cent and a fixed duty of Rs 15,000.

Besides, The Finance Minister also hiked basic customs duty to 75 per cent from 60 per cent for fully imported vehicles with FOB value more than USD 40,000 and with engine capacity of over 3,000 cc and 2,500 cc for petrol and diesel driven vehicles.

Society of Indian Automobile Manufacturers (SIAM), however, welcomed the move to impose higher customs duty imported luxury vehicles.

"The increase in customs duty on cars and MUVs, valued above USD 40,000, from 60 per cent to 75 per cent seems to be a step to encourage local manufacturing, value addition and employment," SIAM President S. Sandilya said.