TVS Motors GM (sales) C. W. Amorkar (left) in Calcutta on Wednesday. Picture by Kishor Roy Chowdhury

Calcutta, March 16: TVS Motors, India?s third largest two-wheeler manufacturer, is yet to decide on a price rise. Automobile companies are planning price hikes as steel rates are expected to rise sharply in April.

However, fierce competition in the two-wheeler segment has prevented companies from increasing prices in the last few years even as input costs have gone up substantially.

Companies have been offering discounts to push up sales.

?The company is looking at various parameters before taking a decision,? a TVS official said today.

So far, two-wheeler companies took the hit on their bottomline but refused to raise prices like their counterpart in the four-wheeler segment.

With the imminent hike in steel prices between Rs 2,500-4,000 per tonne, four-wheeler majors like Maruti, Hyundai, General Motors have decided to increase prices by 3-5 per cent from next month.

Industry observers pointed out that brands do not command a premium in the two-wheeler segment and there is hardly parameter to differentiate the products available in the market.

?At the end of the day price makes all the difference to a consumer,? they said.

Even as the decision lies with individual companies, it had to be a pan-industry move.

With the new offering of ?Star?, TVS is expecting a 30 per cent share in the economy segment of the motor bike space. This segment has recorded the highest growth of 33 per cent this year and the same trend is expected to follow next year. About 1.5 lakh units are sold every month in the economy segment compare with 3 lakh units of the popular segment and 50,000 units of the premium segment. At present, TVS has about 15-17 per cent share in the economy segment.

The company cannot push up the volume now due to capacity constrains. However, it is ramping up production at its Hosur plant from 26,000 to 50,000 units to produce more of the Star, which is priced at Rs 31,000.