Car Prices Set to Rise from January as Automakers Cite Increased Costs
New Delhi, December 8: Vehicle manufacturers in India have announced price hikes across various car models starting January 2025, attributing the increase to rising input and operational costs. However, industry experts believe this yearly practice also aims to boost December sales, as buyers often defer purchases to the new year.
Rajat Mahajan, Partner at Deloitte India, explained, "Price hikes are typically observed at the beginning of a calendar or financial year, although some manufacturers time increases based on planned launches."
Rohan Kanwar Gupta, Vice President and Sector Head (Corporate Ratings) at ICRA, added, "Automakers generally increase prices in January to offset operational cost pressures stemming from inflation and rising commodity prices. Many manufacturers have already announced price adjustments for similar reasons."
Announcements by Major Automakers:
- Maruti Suzuki: India’s leading carmaker, selling models from the Alto K10 to the Invicto, has attributed the hike to escalating input and operational costs.
- Hyundai Motor India: Plans to raise prices by up to ₹25,000 across its model range from January 1, 2025.
- Mahindra & Mahindra: Announced a 3% price increase for its SUVs and commercial vehicles to address rising inflation and commodity prices.
- MG Motor India: Will implement up to a 3% increase across all models, citing higher input costs and external factors.
- Honda Cars India: Considering price hikes, though the exact increase has yet to be finalized.
- Luxury Car Segment:
- Mercedes-Benz India: Plans a 3% price hike starting January.
- Audi India: To increase prices across its range by up to 3%, citing rising input and transportation costs.
- BMW India: Also planning a 3% price increase across its portfolio.
Industry experts note that passenger vehicle manufacturers are offering significant discounts on existing models to reduce inventory levels. The planned hikes come as a balancing act to offset rising costs while maintaining competitiveness in a price-sensitive market.
