Mercedes-Benz India has announced a price hike across its range of cars and EVs by up to 2 percent. The company says that the increase in car prices, which will come into effect on January 1, are because the “Euro-INR exchange rate consistently remains above Rs 100 mark.”

1. Mercedes says price hike varies from model to model
2. Cost of imported parts and CBUs affected by Euro-INR exchange rate

Why Mercedes car prices are increasing

The Euro-Rupee exchange rate, rising input costs, increasing logistical expenses, and inflation.

Regarding the price hike, Mercedes-Benz India MD and CEO, Santosh Iyer, said that the Euro-INR rate has been unfavourable for longer anticipated this year. “This prolonged volatility affects every aspect of our operations, from imported components for local production, to completely built units. In addition, rising input costs, increasing logistical expenses, in combination with inflationary costs have significantly risen our overall operational costs,” he said.

While the price hike varies from model to model, CBUs will be most affected, though even locally assembled cars with imported components will see increases. Mercedes’ Pune plant assembles the A-Class Limousine, GLA, C-Class, GLC, E-Class LWB, GLE, S-Class, GLS and Maybach S 580, EQS 580 sedan, and EQS SUV 450. The rest of its portfolio of EVs, Maybachs and AMG performance models are imported.

However, Mercedes India’ MD and CEO went on to say, “Thanks to RBI’s continuous repo rate reduction, enabling Mercedes-Benz Financial Services (MBFS) to pass on the benefits to end customers, thereby mitigating price increase effect to a large extent.” The brand claims that MBPS facilitates about 50 percent of its sales in the country, and that 80 percent of those who buy a Mercedes-Benz car use financing.