Shifting gear

New Delhi, March 4: Leading two-wheeler makers today reduced prices to revive flagging sales.

In the budget, the excise duty on two-wheelers was cut to 12 per cent. Previously, the duty was 16 per cent.

The country’s second largest two-wheeler maker, Bajaj Auto, has slashed prices of its motorcycle models by up to Rs 3,000.

“Sales of two-wheelers have dropped by about 8 per cent between April 2007 and February 2008. It is the 100cc segment which was responsible for the negative growth. We, however, hope that the excise cut will help revive the market,” said N.K. Ratan, general manager (sales and marketing) of Honda Motorcycle and Scooters India (HMSI).

HMSI will cut prices of its two-wheelers by Rs 1,000 to Rs 1,700 from this month.

Hero Honda, the largest two-wheeler maker, is also slashing prices by Rs 1,000-2,400. The company cut prices of its 100cc Splendor Plus by Rs 1,300, while the 225cc Karizma will cost Rs 2,400 less. The 150cc Hunk will be cheaper by Rs 1,800.

A senior Hero Honda official said, “If the finance minister wants to provide a boost to the two-wheeler industry, he should give us a further excise cut of 8 per cent and make financing easier.”

According to Amit Nandi, general manager (marketing) of Bajaj Auto, “The excise duty cut roughly translates into a price correction of Rs 1,000 per unit but we have reduced prices more than the duty relief on certain models.”

The price of Bajaj’s entry-level 100cc model Platina has been reduced by Rs 2,000-3,000. The motorcycle will now be available for Rs 30,000 (ex-showroom).

“On certain Platina variants, the price cut is Rs 2,000 but most of its variants will see a reduction of Rs 3,000,” said Nandi.

The Discover (125cc and 135cc), the Pulsar (150cc and 180cc) and automatic scooter the Krystal will see price cuts of up to Rs 1,000.

However, Bajaj is not offering any price cut on its 220cc DTS-Fi bike.

The company’s 125cc XCD DTS-Si (kickstart variant) will now cost Rs 1,500 less at Rs 37,500. It has, however, not cut the prices of the self-start variant of the XCD.