Maruti Suzuki India Limited has decided that it will not pass on the lower excise duty benefit to its new Maruti Swift customers. Maruti Swift’s new petrol variant attracts 8 percent or nearly Rs 40,000 excise duty benefit due to its 1.2L petrol engine. The company had launched this model in January but has retained its base price of Rs. 4 lakh of its 1.3L model.
New car models with base length less than 4 meters with 1.2L petrol and diesel engines smaller than 1.5L attract 8 percent excise duty benefit. On the other hand, all other models bigger than these attract 20 percent excise duty.
Maruti Suzuki usually passes all such benefits to its customers but this time it has decided to offset input costs rise. “For Swift, there is a cost increase owing to the new petrol engine. Add to it the increase in commodity prices,” the company spokesman said.
On the other hand, industry experts say that Maruti has kept the cost steady at this point of time as it expects strong competition in premium compact segment. Thus, when there are new launches like Ford Figo, Nissan Micra, VW Polo, Toyota Etios, etc. it will be in a position to lower the prices of its most popular model to keep the sales clock ticking and take the competition head on. (source)