Carmakers Set to Hike Prices in April Amid Rising Costs and Currency Depreciation
Passenger vehicle (PV) prices in India are set to rise once again from April 2025, as most major original equipment manufacturers (OEMs) plan a second hike in four months.
New Delhi: Passenger vehicle (PV) prices in India are set to rise once again from April 2025, as most major original equipment manufacturers (OEMs) plan a second hike in four months. The move comes amid rising input costs, currency depreciation, and efforts to maintain profitability in a slowing market.
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Second Price Hike in Four Months
Leading carmakers such as Maruti Suzuki, Hyundai, Mahindra, Kia, and BMW have confirmed price increases of up to 4% starting April. This follows a similar round of hikes in January 2025.
| Company | January 2025 | April 2025 |
|---|---|---|
| Maruti Suzuki India | Up to 4% | Up to 4% |
| Hyundai Motor India | Up to ₹25,000 | Up to 3% |
| Tata Motors | Up to 3% | Not disclosed |
| Mahindra & Mahindra | Up to 3% | Up to 3% |
| Kia India | Up to 2% | Up to 3% |
| BMW Group India | Up to 3% | Up to 3% |
Why Are Prices Going Up?
According to Primus Partners Vice President Nikhil Dhaka, the hike is driven by multiple factors:
- Rising raw material and logistics costs
- Currency depreciation impacting imported components
- Persistent global supply chain disruptions
“Manufacturers are forced to transfer some of the cost burden to consumers despite subdued demand,” Dhaka explained.
Commodity prices have seen a steep rise. For instance:
- Aluminium: Up 10.6% YoY
- Rubber: Up nearly 27% YoY
S&P Global Mobility Director Puneet Gupta noted that the Indian rupee has depreciated by 3-4% in the past 6-7 months, making imported electronic components (which make up 30-50% of modern cars) more expensive.
Low Sales, High Discounts
The price hike comes at a time when the auto industry is grappling with falling sales and high inventory levels. As per FADA data:
- PV retail sales in February fell 34.88% MoM and 10.34% YoY to 3,03,398 units
- Inventory levels remained elevated at 50-52 days, against the ideal of around 28 days
To push sales and reduce stocks, automakers have been offering heavy discounts for months. However, with the upcoming Navaratri festival (March 30–April 7) and marriage season, OEMs see a window to boost profitability.
“Despite the planned hikes, discounts may persist throughout the year due to prevailing market pressures,” Gupta said.
Outlook
While consumers may feel the pinch of another price increase, carmakers are walking a tightrope between managing costs and sustaining demand. The festive season will be critical in determining how well the market absorbs this new round of hikes.
