The Finance Minister Pranab Mukherjee's 2010-11 budget has led to mixed reactions from the industry. Earlier in the day, the minister had announced a 2% hike in excise duty on large cars, SUVs and multi utility vehicles taking the excise duty from 8% to 10%.
Reacting to the Budget 2010-11 moves, Paul de Voijs, managing director, Volvo Auto India Pvt. Ltd. said, "As per the Union Budget 2010 presented by the hon’ ble Finance Minister, the 2% increase in the excise duty on cars will lead to a hike on the car prices. Unfortunately this will be passed on to the end consumer as it is inevitable.â€
Karl Slym, president & managing director, General Motors India, said, "The budget did not meet all the expectations as the sector is yet to recover fully. We were not expecting any hike in excise duty and imposition of some duty on petroleum products at this juncture. The automotive industry is one of the growth drivers of the economy and as such, continuation of the stimulus package for some more time would have helped the industry to recover fully from the recession. Having said this, some concessions given to environment-friendly mobility solutions are welcome decisions."
Talking about the hike in excise duty he said that the impact will have to be evaluated and there would be an increase in vehicle price.
"The effect of increase in excise would have an inflationary trend. Partial roll back of stimulus was expected. Increase in price of petrol and diesel will certainly hurt consumers," stated Rajeev Kapoor, president & CEO, Fiat India.
