ACs, TVs, fridges to cost more as third price hike this year kicks in from October 1

Consumers will face another round of price increases just as the festive season approaches. Prices of electronic goods such as air conditioners, LED TVs and washing machines are likely to rise from October 1, marking the third such hike this year.

Companies say the increase is being driven by rising prices of copper, aluminium, steel, plastic and crude oil-linked products, along with higher freight costs and fluctuations in the rupee against the dollar. Faced with rising raw material costs, major companies are preparing to raise prices of their products by five to eight percent.

Air conditioner prices could rise by around five to eight percent, while some companies are raising prices of washing machines, refrigerators and LED TVs by three to four percent. Some companies are still assessing the situation. While some firms fear the price hikes will affect demand, others believe the impact will be limited since dealers and distributors already hold stock priced at the older rates. Blue Star, Godrej Appliances, Haier, Daikin and Super Plastronics have already announced price increases on various products.

Bosch Home Comfort, which sells air conditioners under the LG and Hitachi brands, has also raised AC prices by about five percent. Panasonic is currently reviewing its pricing. Blue Star managing director B. Thiagarajan said that due to rising raw material costs, prices of air conditioners and deep freezers have already been increased by five to eight percent, with the company having raised prices three times this year so far.

According to Kamal Nandi, business head and executive vice president of Godrej Enterprises Group, raw material costs have risen by eight to ten percent since the last price review, making a five to seven percent price increase across various products unavoidable. However, he said goods purchased at the older prices may still be available in the market for another month to six weeks.

Kanwaljeet Jawa, chairman and managing director of Daikin Air Conditioning India, said the company has already raised prices by eight to ten percent since September 16. He said the cost pressure on companies has increased further as copper prices have risen by around 25 to 35 percent and the dollar has strengthened. Super Plastronics Private Limited said it is considering raising TV prices by about seven percent after October, and has already raised prices of other home appliances by four to five percent.

Sales of electronics and home appliances typically see a big jump during Navratri and Diwali as companies offer discounts, and the industry is concerned the price hikes could affect festive demand. Even so, companies say dealers and distributors built up sufficient stock at older prices in August and September, so some items may still be available at the old prices until Diwali.