The Indian consumer durables industry is expecting higher input costs due to a newly approved budget. Price hikes are being debated among major appliance makers as steel is largely used in the manufacturing of air-conditioners, refrigerators, and other white goods.
Timing is an issue as the industry is gearing up for the crucial festive season, which accounts for over 50 percent of annual sales. "It's not just steel prices, the tax hike also affects us. Ultimately, consumers end up paying for these and we will go with market trends," says TK Bannerji, country manager, Haier India.
Players will obviously watch carefully as there are fears that Indian demand will dry up. "Generally, prices will go up since the sector gets nothing in the budget. Increasing prices means that the domestic market will not grow, which will have a negative impact on capacity expansion and exports," says LG marketing head Salil Kapoor. (Indian Times)
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