Honda Siel Cars India announced on Saturday a Rs 10,000 to Rs 30,000 cut in prices of its mid-size car City and luxury sedan Accord.

The 2-3 per cent reduction on the ex-showroom prices would be effective from Sunday, a company release said.

Honda attributed the price cuts to lowering of peak customs duty by five per cent to 20 per cent and the abolition of four per cent special additional customs duty by the government on January 8.'

The '1.5 Exi' version of the 'City' would now cost cost Rs 20,000 less at Rs 647,000.

There has been a Rs 10,000 reduction in the ex-showroom Delhi prices of the 'GXi' and 'CVT' variants of the car at Rs 697,000 and Rs 757,000 respectively.

The prices of the manual and automatic transmission variants of the 'Accord' has been brought down by Rs 30,000 to Rs 14.65 lakhs (Rs 1.46 million) and Rs 15.35 lakhs (Rs 1.53 million) respectively.

The cut in prices by Honda was effected close on the heels of price increases made by Maruti Udyog and Tata Motors citing higher input costs. Other carmakers like General Motors and Ford have also announced plans of a price hike.

Welcoming the lowering of duties by the government, Honda Siel Cars president and CEO H Yamada said the price cuts was expected to further boost sales of both the cars.

Sales during April-December 2003 jumped 36.4 per cent to 13,040 units on the back of rising demand for the recently-launched all-new 'City'.

Honda Siel Cars India is 99 per cent owned by Japan's Honda Motor Company. One per cent stake is with Sidharth Sriram-promoted Siel Ltd.

The company produces the two cars at its plant outside Delhi. It also imports and sells the sports- utility-vehicle 'CR-V'.