Major automakers are preparing to increase the prices of their vehicles in the second quarter of this year due to a sharp increase in the prices of various essential commodities such as steel and semiconductor parts.
While Maruti Suzuki has said it will raise prices in the second quarter without specifying the amount of the hike, India’s largest two-wheeler maker Hero MotoCorp is raising up to Rs 3,000 for its bikes.
Usually, automakers raise prices at the start of the year in January. In an unprecedented move, most automakers have already raised prices twice this year so far.
“MSIL is expected to raise prices on July 21, and others may follow suit,†stock research firm Motilal Oswal said.
Read more: Maruti Suzuki India to increase car prices in July-September quarter amid rising input costs
Luxury automaker Mercedes-Benz has also raised the price of some models from mid-June due to rising input costs and the weakening rupee, a company spokesperson said. .
Meanwhile, local automakers like Tata Motors and Mahindra Group are also actively considering a price hike for their vehicles in the second quarter, sources familiar with the development said. DH.
“Mahindra’s price hike could be as high as 3%,” an industry source said.
Tata Motors has yet to confirm what the price hike could be.
“The prices of commodities, raw materials and other inputs continue to rise. A price increase appropriate to at least partially offset this increase in costs seems inevitable in the short or short term, â€said an industry source.
In May, Mahindra General Manager (Automotive Division) Veejay Nakra said the company was considering a price hike that could range between 1.8% and 3% depending on the model.
Last week, Maruti Suzuki announced a price hike for its vehicles from July due to the high cost of rhodium and palladium.
He said the prices of steel went from Rs 38 per kg to Rs 68 per kg while Rhodium went from Rs 19,000 per gram to around Rs 66,000 per gram.
Rhodium has seen the highest price hike for any commodity internationally since the pandemic began last year.
This is used in catalytic converters and helps reduce emissions.
Maruti has already increased the prices of its vehicles to Rs 22,500 for some models in April and to Rs 34,000 in January.
Hero Motocorp has increased the price of its vehicles to Rs 3,000 with effect from July 1st. Prior to that, he had increased vehicle prices by Rs 2,500 in April.
While the rise in Maruti’s price drove the stock price up 10% between June 21 and 25, Hero Motocorp shares rose but not massively.
“The company has announced a price increase which indicates its ability to pass through raw material cost inflation despite the difficult business environment to improve its margins,†said Mitul Shah, research manager at Reliance Securities. DH.