Honda Atlas Cars will now be pricier than ever, with inflation of between Rs50, 000 and 85, 000 for each car, according to a notification issued by the company to its dealers. This news comes following the devaluation of the rupee.
The notification specified that referring to the last rupee devaluation, Honda Atlas Cars Pakistan Limited did not pass any impact of the exchange rate to the customers, as they hoped for the stabilization of the rupee. However, things have changed. According to Honda, it was no longer feasible to maintain lower rates. As a consequence, they increased the prices of the cars with effect from April 1, 2019.
Revised prices of Honda cars in Pakistan
The Honda City 1.5L MT variant is now priced higher by Rs65, 000, raising the price to Rs1.98 million from the previous Rs1.91 million. The company’s 1.5L AT model has also become more expensive by Rs65, 000 to Rs2.12 million. The 1.3L MT variant has seen a similar increase of Rs65, 000, from the previous Rs1.85 million to the current Rs1.92 million. In the same vein, the company raised the cost of 1.3L AT variant from Rs1.99 million to Rs2.06 million.
On the other hand, Honda has increased the price of the 1.5L Aspire AT from Rs2.2 million to a whopping Rs2.27 million. The 1.5L Aspire MT has also gotten costlier from the Rs2.06 million to Rs2.13 million.
The rates of variants such as BR-V CVT have also shot up from Rs2.38 million to Rs2.43 million, and that of BR-V S CVT from Rs2.48 million to Rs2.57 million. However, Honda has kept the BR-V MT variant’s price the same at Rs2.23 million.
The current prices of the Honda Civic variant 1.8L Oriel CVT is Rs3.3 million and that of the 1.8L CVT is Rs3.1 million. The Turbo 1.5 CVT is now priced at Rs.3.5 million. Company officials said new bookings with a minimum amount of Rs1.2 million should continue until another notice is issued.
Honda City 2019 (price range: 1.92 million to 2.27 million)
Honda Civic 2019 (price range: 3.2 million to 3.8 million)
Honda Accord 2019 (price: 13.75 million)
Honda BR-V 2019 (price range: 2.23 million to 2.57 million)
Honda HR-V 2019 (price: 4.8 million)
According to the notification, there are only a few particular orders that will be invoiced at the previous rates and delivered now. These are the ones involving City and BR-V cars that are backorders due till April 2019 and with payments clear (parked) till March 30. Unfortunately, the rest of the backorders with full or partial payment will be charged the new – higher – prices.
The auto companies’ profit margins contracted from 5-6% in December 2018 to around 3% now. Likewise, Honda has experienced the same dire situation. Reportedly, this is the second time this year the company has felt the need to inflate its car prices. The last increase was not enough to restore the profit margins in the company’s accounts. However, if inflation in the country reaches 10%, Honda would be unable to bridge the difference solely through an increase in its prices by the same percentage. After all, a rise in price leads to lower sales.
The rise in prices and fall in sales of cars lead to an endless spiral of loss for both the company and buyers. Notably, fewer products also translate into higher production costs. As a result, the prices are likely to be raised again. In other words, the prices might have increased, but there’s no guarantee even these will last for long.