The weakening rupee is taking its toll on the prices of consumer durables again. All major players such as LG, Samsung and Godrej have taken an average of 2 to 5 per cent price increase on products across categories.
Today, the rupee closed at 52.54 against the dollar. It earlier touched 52.73.
Every time the rupee weakens against the dollar, makers of consumer durables skip a beat as almost every product in this category contains at least 35 per cent of imported components. “Almost all of us import some key components such as compressors, motors, printed circuit boards and in some cases steel sheets too,” says a source in the industry.
In categories such as refrigerators and washing machines, all top-end models, across brands, are imported as CBUs (completely built units). And, most companies import their entire range of microwave ovens as CBUs from countries such as Taiwan, China and Korea.
Samsung, which increased the prices of some select products by 2 to 3 per cent a month-and-a-half ago, early this month increased the prices of almost all durables and mobile phones, by 2 to 5 per cent. In rupee terms, it works out to between Rs 200 and 1,000 in the case of durables and Rs 40 and 800 in the case of mobile phones.
“Though we did not want to disturb the consumer sentiment during the festival season, the rupee impact was so severe that we had to take an increase,” said Ms Ruchika Batra, Samsung's spokesperson for Southwest Asia.
LG Electronics, earlier in September, when the rupee went below the 48 mark, took an increase of 3 to 5 per cent. Earlier this month, it had announced another round of increase (of 4 per cent on an average) on products across categories. Godrej, too, has increased the prices of its washing machines and refrigerators in the range of 2 to 5 per cent. > rravikumar@thehindu.co.in