Mercedes-Benz cars in India might become costlier from April
What's the story
Mercedes-Benz is mulling a price hike for its cars in India this April, owing to the continuous depreciation of the Indian Rupee against the Euro. The news was revealed by Santosh Iyer, Managing Director and CEO of Mercedes-Benz India. The company had already raised prices in January this year and now stands on the verge of another hike.
Currency impact
Euro's rise against the Rupee
Iyer was worried about the recent surge of the Euro against the Rupee, which has hit 95 levels. He said Mercedes-Benz India has priced its cars at 90 (Rupee level), which means a huge potential increase. The company has to react to any adverse changes in foreign exchange rates, Iyer said. He noted that "the five rupee increase is almost 5-8% increase in exchange rate."
Market outlook
Luxury car sales to remain under pressure
Iyer also shared his expectations from the luxury car market, predicting that sales will continue to remain under pressure for at least two quarters due to subdued demand. He explained that geopolitical factors are impacting customer sentiments and growth momentum in the domestic market. Despite these challenges, Iyer is optimistic about Mercedes-Benz India's future growth, saying, "The brand still remains very desirable...maybe one or two quarters may see a flat growth."
Market competition
New players like Tesla will help to grow the market
When asked about the impact of new entrants like Tesla in the local market, Iyer welcomed their arrival, saying that "new players always help to grow the market." He also addressed concerns over Maharashtra's 6% tax on electric vehicles priced above ₹30 lakh, saying it could negatively impact demand. Despite these challenges, Mercedes-Benz India continues to strive for growth and maintain its position in India's luxury car segment.