Some days ago we had reported to you about Bajaj Auto contemplating raising their two wheeler prices because of the falling rupee value. Now we have an exactly the opposite plans being spoken out by the company. They are likely to cut the prices of their products for the Sri Lankan market.
The Indian company may bring down the two wheeler prices in the island nation. Not only the two wheelers, but even the three wheeler prices are likely to see a cut in the prices. The reason for this price cut is giving a boost to their products and trying to capture the market there. It has been known that the price cut will be done between the company and the dealers in Sri Lanka.
As far as the price cut is concerned, it may range from 5 per cent to 14 per cent for the two wheelers. The exact price cut will depend on the model of the bike. These developments from Bajaj Auto come after the Sri Lankan government has restructured the new duties a while back.
For the current financial year, the Sri Lankan government imposed heavy duties ranging from 60 per cent to 100 per cent. The hike was made taking into account the reduction of vehicles in the country and thereby reducing the oil expenditure as well. But the new duty has done no good to the vehicle sales there. Bajaj was the most badly affected company of all.
Bajaj vehicles in Sri Lanka cost at least 30 per cent more before the budget. So that is doing them no good. Things really turned out to be bad for Bajaj Auto as they recorded almost no sales in May this year. There is no doubt that the island nation is one of the best markets for Bajaj Auto.
It is clear from the fact that Bajaj records around 5 per cent to 7 per cent of its aggregate sales from the Sri Lankan market. Bajaj exports 10,000 two wheelers and 10,000 three wheelers in Sri Lanka every month. As far as the price slash is concerned, it is the probably the highest in the history of the company. But at the same time, it was needed to stop the fall in the continuous fall in the sales.
It now remains to be seen what response the company gets after such a heavy price reduction.