Raw Price Hike
With the prices of raw materials doubling during the last one year, pumpset manufacturers here are concerned over declining competitiveness.“Normally, we revise the end product price once in three or four years. In the last two years we have revised it twice resulting in a 7 per cent increase. Even then, the companies are unable to maintain their competitiveness. Though there is a serious need for further revision, the units fear competition and a dip in sales if the prices go up again,” says Jayakumar Ramdass, president of the Southern India Engineering Manufacturers’ Association. He told The Hindu here on Saturday that in the pumpset industry, the production costs went up when the rate of any material increased – be it metallic or non-metallic, ferrous or non-ferrous. Steel, aluminium, copper, rubber, plastic, varnish and grease were all used in making a pumpset. In the last one year, while the prices of some materials had doubled, others suffered a hike of 60 per cent to 70 per cent for others.
Further, the units here bought these from the North and now there was a shortage in availability of some raw materials too. “The bottomline has suffered drastic erosion and is threatening to hit growth and expansion plans of the pumpset units here,” he said. “We cannot control the raw material prices. We have to explore innovative marketing methods,” he added. The companies had been discussing price revision for quite some time. The units were reluctant fearing a further slump in business.“Doing business is increasingly becoming a challenge. We do not need subsidies. But, we do need infrastructure support,” he said.
For instance, the frequent power cuts had turned the situation worse for industries here; attrition rate among the staff was also high. He appealed to the Government to ensure that raw material prices in the country were at the same level of international prices and not higher. The prices should stabilise, he said.
