Rising vehicle price becomes a concern among prospective buyers

The prices of vehicles have already been revised twice this year, making car ownership a true luxury

The steep rise in the costs of raw materials across Indian automobile industries and the disruption of supply chain at the international border gates have forced auto dealers in Bhutan to increase vehicle prices twice this year.

According to the auto dealers, who Business Bhutan interviewed, compared to the previous years, the price hike of 1% to 3% by April is indeed huge, and they mostly attributed it to the scarcity of raw materials at the source.

With savings taking a major hit due to the ongoing Covid-19 pandemic, these price escalations are overwhelming potential buyers, who now have to pay between Nu 5,000 to Nu 20,000 more while purchasing small and medium size vehicles, which include brands like Alto, i10, EON and i20 Elite.

By September SUV brands like Creta and Venue were up by Nu 10,000 to Nu 25,000.

Even local economists are concerned about how the rising freight cost is impacting the prices of everything from furniture and vehicle parts to basic staples, exacerbating the condition of the global market.

“A host of reasons, including rising demand, container scarcity, overburdened ports and a shortage of ships and dock personnel, have all contributed to the tightening of transportation capacity on all freight routes,” an economist pointed out.

An official from the Zimdra Automobiles confirmed that by September this year the prices of some of their models were revised by an upward of 1.9%, between Nu 1,000 to Nu 22,000, depending on the model.

“There has been a steady hike in the price of these models since January last year,” said an official of the agency, “It’s mainly due to the rise in the cost of production at Maruti Suzuki plants in India.”

The model Vitara Brezza’s price tag has gone up by Nu 10,000, with Ertiga costing Nu 20,000 more, while Baleno becoming dearer by Nu 15,000.

Even Maruti’s entry-level models like Alto 800 saw a hike of Nu 16,000. The price of other models like S-Presso, Wagnor R, Swift, Dzire also increased by Nu 7,500, Nu 12,000, Nu 13,000 and Nu 10,000 respectively.

Meanwhile, Maruti Baleno and Ignis will be costlier by Nu 15,000 and Nu 14,500 for some variants. However, the Ciaz and the S-Cross sedans saw the biggest jump in the price by Nu 20,500.

Further, all Hyundai cars will now cost Nu 17,000 more. The prices of the Santro, Grand i10 Nios, and Aura models have increased by Nu 15,000, while Tucson’s price increased by Nu 12,000, and i20 and Venue by Nu 8,000.

Hyundai, meanwhile, is the latest carmaker to hike the prices of its entire lineup of different models, including i20 and Creta.

Likewise, the prices of commercial vehicles of Tata Motors have also increased from October 1. The effective price hike, in the range of 2%, has been implemented on the basis of the model and the variant of the vehicle.

For instance, Tata Tiago and Tigor are now pricier by Nu 10,000 and Nu 8,000 respectively.

But the Harrier and Safari models saw a very high increase of Nu 27,000 and Nu 21,000. It is safe to say that Tata is catching up with others in bumping up the price.

Likewise, the prices of popular Ford brands like EcoSport, Endeavour, Figo, Aspire and Freestyle have also increased considerably.

Kinley Yonten from Thimphu