Hinduja flagship company Ashok Leyland today said it will cut the prices of its trucks by an average of over Rs 16,000 per unit on account of the government's decision to reduce excise duty by two per cent.
"In line with the excise duty reduction from 10 per cent to 8 per cent in respect of trucks and auto components, Ashok Leyland will pass on the full benefit to its customers," the company said in a statement.
"The impact of the duty reduction will work out, on an average, to over Rs 16,000 per vehicle," it added.
The company would pass on the benefit in spite of the fact that the inventory of vehicles had attracted a higher excise duty, the statement said.
Post the 4-per cent reduction in CENVAT last year, CVs attracted a duty of 10 per cent. The latest 2 per cent cut by the government is applicable to only those categories, which attracted a 10 per cent excise duty.
Finance Minister Pranab Mukherjee had yesterday announced two per cent excise duty cut as part of the interim Budget.
After the announcement, Ashok Leyland Managing Director R Seshasayee had said the company would pass on the benefit as and when the reduction would be applicable.
Seshasayee, however, had added that demand for CVs in the country was unlikely to pick up with this duty cut as it was driven by construction, road development and mining activities.
Tata Motors maintained that it would also pass on the two per cent excise duty benefits on trucks to customers.
