Mahindra and Mahindra Ltd will increase prices of its vehicles, including sports utility vehicles, by about 0.4 per cent while it is expected to reduce tractor prices by up to four per cent within a week.
"The prices of our utility and commercial vehicles will be raised immediately," M&M vice-chairman and managing director Anand Mahindra told reporters on the sidelines of the foundation day function of Bombay Stock Exchange.
The increase in prices was being effected due to certain tax proposals in the Union Budget for 2004-05, he said, adding the hike in prices would be in line with what has been done by other car companies.
Asked about passing on the tax benefits on tractors to the customers, he said the "cut will not be drastic and we will have to take into account the rise in excise duty on steel and the two per cent education cess"
The cut in tractor prices was likely to be upto four per cent, he said.
Mahindra said the company officials are working on the net impact of tax proposals and "we will announce a decision (on tractor prices) within a week."
The growth in tractor sales has been above estimates and "we are revising the business strategy for the year," Mahindra said.
In fiscal 2003-04, the company produced 50,102 tractors and sold 49,576 units.
