Luxury car maker Mercedes-Benz India on Tuesday said it will increase prices of all of its models with effect from May 1 to offset rising input costs and impact of adverse currency fluctuations.
"The prices of all Mercedes-Benz models will be revised upwards effective May 1, 2011 for the Indian market," Mercedes-Benz India Managing Director and CEO Peter Honegg said in a statement.
While the company did not specify by how much the price would be increased, it is understood that the hike across the models could be in the range of 1.5 per cent to 2 per cent.
The company sells a host of models, including the C Class, E Class, S Class and the super luxury sedan Maybach, at price ranging from Rs 25.47 lakh to Rs 5.85 crore (ex-showroom Delhi).
Honegg said the step has been necessitated due to the rising input costs and challenging exchange rates as well as inflationary impacts that have a bearing on the cost of the final product.
"We have absorbed these to a significant level but moving forward we will have to pass on some portion of this impact to the customer," he added.
When contacted, rivals BMW and Audi said at the moment they are not planning any price hike.
Luxury car makers, which import completely knocked down (CKD) units and assemble here in India have been facing increased pressure on margins after the government changed import duty on CKD in the Budget for 2011-12.
For pre-assembled engines, transmissions and gearboxes import duty was fixed at 30 per cent as against 10 per cent earlier.
However, other parts continue to attract a customs duty of 10 per cent. The duty on fully imported car through completely built unit route attracts a customs duty of 60 per cent.
