Rising Input Costs Trigger Price Hikes In Auto Sector

New Delhi, Mar 20 (KNN) Motown’s automobile industry is bracing for another round of price hikes as rising commodity prices continue to put pressure on manufacturers.

Leading automakers, including Maruti Suzuki, Hyundai, Kia, Tata Motors, and Honda Cars, have announced price increases starting in April 2025.

Mahindra & Mahindra is also considering adjustments based on market conditions and input costs.

Auto industry experts cite escalating operational expenses and higher raw material costs as primary factors behind the hikes. Hyundai Motor India’s COO, Tarun Garg, emphasised the necessity of these adjustments, stating, “With the sustained increase in operational expenses, it has now become imperative to pass on a part of this cost escalation through a minor price adjustment.”

Hyundai has announced a price hike of up to 3 per cent, effective in April, attributing it to increased input costs and higher operational expenses.

Kia, Hyundai’s sister company, has followed suit, declaring a vehicle price increase of up to 3 per cent from April. The final price hike will vary depending on the model and variant.

Similarly, Maruti Suzuki, India’s largest car manufacturer, has announced a price hike of up to 4 per cent, citing rising input costs and operational expenses.

Tata Motors has also revealed its plans for price adjustments. The company will implement a 2 per cent price increase for its commercial vehicles from April 1 and intends to extend the hike to its passenger vehicle segment.

Despite tepid retail numbers, industry insiders believe automakers are resorting to price increases due to geopolitical uncertainties, supply chain disruptions, and tariff threats.

The Federation of Automobile Dealers Associations (FADA) President, C.S. Vigneshwar, noted that inventory levels have remained high at around 50 days, though efforts are underway to reduce them to 30 days.

While March sales may benefit from depreciation advantages, analysts caution that consumer demand could take a hit from May onwards due to the mounting price burden.

(KNN Bureau)