Mercedes-Benz India announced a price hike of up to 3 per cent on Friday across its entire model range to counter rising input costs. However, the German automaker clarified that the price adjustment will only apply to vehicles not currently in stock, with existing and future bookings made by December 31 being protected from the increase.
The company explained that rising input costs, inflation, and higher operational expenses have been putting significant pressure on its business operations in India. Over the past three quarters, Mercedes-Benz has been absorbing these rising operational costs without passing them on to customers.
Santosh Iyer, Managing Director and CEO of Mercedes-Benz India acknowledged that the company has been facing "increased pressure" on its cost structure due to a sharp rise in material costs during this period.
He emphasised that while the company has worked diligently to manage costs internally, the ongoing increase in input prices and other operational pressures has made it increasingly difficult to maintain profitability without adjusting prices. "While we have been absorbing these cost pressures by optimising our operational costs and driving higher efficiencies, the overall bottom line is getting impacted, considering the current challenges," Iyer said in a statement.
The price adjustment has been implemented to "ensure the sustainability of our business," Iyer explained. He clarified that the revision will only apply to vehicles not currently in stock, with price protection extended to all existing and future bookings made before December 31.
Mercedes-Benz India stated that the decision to revise the ex-showroom prices across its entire model range was driven by the need to offset rising operational costs and inflationary pressures. According to the company, prices for its vehicles will increase by up to Rs 2 lakh for the GLC, and up to Rs 9 lakh for the top-end Mercedes-Maybach S 680 luxury limousine.
The statement added, "Although the company will continue to absorb the bulk of these costs, a nominal portion will be passed on to the market. "
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