Air conditioners have become expensive and are likely to become even more expensive from next month onwards as the AC manufacturers are planning another price hike in March. It may be noted that AC manufacturers have raised prices by 8-20% in the last two months. Another price hike of at least 5% cannot be ruled out by most of the AC manufacturers next month say the industry observers.
March is an important month for AC industry as the recouping of the stock of the new units usually takes place during the second half of March. Usually, new season for the industry begins post Holi festival and lasts till mid-June.
Window AC has seen the highest price hike in the last two months as the manufacturers hiked the prices by nearly 20%. On the other hand, prices of fixed speed split AC have gone up by 10% and inverter AC by around 8%.
According AC manufacturers, price hike is inevitable as the cost of raw materials, especially that of metals, have gone up steeply in recent months. Over the last nine months, key raw materials like copper, aluminum and plastics prices have surged by 30-60%.
Reasonably good festive season, pre-buying in anticipation of price hikes, revival of real estate industry, ban on import of air conditioners and some pent up demand have resulted in reasonably good third quarter. According to the industry people, the growth momentum witnessed in Q3FY21 continued to remain buoyant in January 2021. However, February 2021 has so far witnessed some softness in the momentum partly attributable to some challenges in availability of material and components. However, the industry expects revival of the demand next month onwards.