AC industry may see 25% drop in sales this year, says Study
Excluding Apple, which is due to report results next Tuesday, the technology sector is looking at an earnings decrease of 0.3 percent
The air conditioner industry may see a 25 per cent drop in sales this year, as companies have raised prices due to hike in excise duty and new energy efficiency norms making production expensive, according to a study by industry body Assocham.
"New energy efficiency norms will raise production cost by at least 15-20 per cent because components for energy efficient air-conditioners are far more expensive than regular air-conditioners," Assocham Secretary General D S Rawat said.
He added, this would push up prices of ACs. "Due to the new norms and hike in excise duty, AC industry would witness a drop of 25 per cent in sales this year compared to the last year, as air-conditioner makers have already increased their prices by 20-25 per cent to pass on the burden to the end-consumers," Assocham said in the study.
Besides, it said increase in input cost has created significant pressure on the profitability of the industry. Therefore, the additional burden on the consumer for one AC is between Rs 3,000 to 7,000 this year compared to last season, it added.