Maruti Suzuki to increase vehicle prices this month due to rise in input costs

The country's largest carmaker Maruti Suzuki India (MSI) on Wednesday said it will increase prices of its entire model range this month due to a rise in input costs.

Maruti Suzuki India announced that over the past year,  vehicles continue to be adversely impacted due to an increase in various input costs. "Therefore, it has become imperative for the company to pass on some impact of the above additional costs to customers through a price hike,” the company said in a regulatory filing.

MSI has already hiked vehicle prices by around 8.8 per cent from January 2021 to March 2022 owing to the constant increase in input costs.

In an interview with Business Today TV on April 4, Shashank Srivastava, executive director at Maruti Suzuki, said, "75 to 78 per cent of the total cost structure of an auto OEM (original equipment manufacturer) is material cost. Commodity prices have been stubbornly high for the last one-and-a-half years and that is the reason we have undertaken four price hikes, but that is not sufficient to cover increased commodity prices."

Maruti has planned this price rise in April, 2022 and the increase shall vary for different models. The company is yet to disclose the quantum of the proposed price hike.

In the interview, Srivastava had said that Maruti Suzuki was expecting the prices to soften, but so far they haven't. It is monitoring the situation closely to see if there is a need to undertake a price hike, adding that price hike is always the last resort for the company.

The company has increased prices four times since January 2021, totalling an almost 9 per cent increase. Srivastava said that the company is conscious of both profitability and volumes, and will shortly take a decision in this regard.