Prices of air conditioners and refrigerators have shot up in the new year as consumer durables makers pass on the impact of rising raw material costs and higher freight charges to customers, while home appliances like washing machines may witness 5-10 percent price hike later this month or by March.
Several companies including Panasonic, LG, Haier have already reviewed prices upwards, while other makers such as Sony, Hitachi, Godrej Appliances may take a call by the end of this quarter.
Moreover, the industry makes hike prices from January to March in the range of 5-7 percent, according to the Consumer Electronics and Appliances Manufacturers Association (CEAMA),
"With an unprecedented surge in the cost of commodities, global freight and raw materials, we have taken steps to increase prices of our products by 3 to 5 percent in the refrigerator, washing machines, and air conditioner categories," said Satish N S, President, Haier Appliances India.
Similarly, Panasonic, which has already increased prices up to 8 percent for ACs, is considering hikes further. It is also mulling a similar move for home appliances.
"Air conditioners have already seen a price hike of around 8 percent and this may further go up depending on rising costs of commodities and supply chain. We can also see a reflection of price hike for home appliances too in near future," stated Fumiyasu Fujimori, Divisional Director, Consumer Electronics, Panasonic India.
South Korean consumer electronics major LG, which has also increased prices in the home appliances category, said a constant hike in input raw material costs and logistics cost has been a concern.
"We have tried best to absorb the same through cost innovations but prices need to increase for business sustainability," said Deepak Bansal, Vice President - Home Appliances and Air Conditioner Business, LG Electronics India.
Other industry leaders have similar views on the matter.
Eric Braganza, President of, CEAMA said, "The industry had postponed the price increase due to the festive season. However, currently, manufacturers have no other option but to pass on the price hike to customers. We expect the industry to do a round of price hike from January to March in the range of 5-7 percent."
Implementation To Vary
However, experts believe that the implementation would vary from company to company as some of the manufacturers have already hiked prices and some are in the process of doing it.
Companies such as Sony and Godrej Appliances said they are yet to take a call.
"Price correction is not on the cards at the moment," said Sunil Nayyar, Managing Director, Sony India.
And, Kamal Nand, Business Head & Executive Vice President, Godrej Appliance has said, "I said going forward, the company will evaluate taking any further hike, given the current drop in demand due to increasing coronavirus infection rate."
Super Plastronics Pvt Ltd (SPPL), which has a branding license for international brands, including Thomson, and White-Westinghouse, said the consumer electronics industry has been observing price hikes on various levels at the backend of things.
"We are assuming that in the last quarter of this financial year, consumer electronics' prices will be hiked on all levels across most categories," Avneet Singh Marwah, CEO, SPPL added.
Gurmeet Singh, Chairman and Managing Director, Johnson Controls-Hitachi Air Conditioning India added, "Increase in input costs - raw material prices, taxes, and transportation fares are pushing brands to increase prices of air conditioners. In a phased manner, upto April, prices will go up by at least 8-10 percent. Prices have gone up from around the same time last year December to this year by nearly 6-7 percent."
"The onslaught of Cost Up is continuing and now with Anti Dumping Duties being imposed on Aluminium and Refrigerants, we see another increase by 2-3 percent. This will be over and above the actual commodity increase on these items and is inevitable. We rationalise the price as much as possible at our end. We make sure that the consumer gets the best cutting-edge technology good quality products at the price they are paying," Singh further added.