India’s largest automaker, Maruti Suzuki, announced on Friday that it will raise the prices of its cars by as much as 4% from January 2025. The hikes will be model-specific, however, as the company will try to pass on the increases in production costs without burdening its customers too much.
Maruti Suzuki has hiked prices due to the rise in input costs, which it says have impacted the automobile sector. The company said that to sustain operations and maintain quality, the hike is necessary. “Some portion of the increased costs must be passed on to the market to sustain operations and maintain quality standards,” the company said in a statement.
The company has also said that the price raise would vary by model, such that some cars would face higher hikes than others, depending upon the production costs and its features. This is part of Maruti’s strategy to have optimized costs while balancing customer satisfaction.
Maruti Suzuki’s Sales Growth
Despite the impending price hike, Maruti Suzuki continues to show strong growth. The company reported a notable increase in passenger vehicle sales, with a total of 141,312 units sold in November 2024, compared to 134,158 units in the same month the previous year. The overall vehicle sales for November 2024 reached 181,531 units, including 144,238 units sold domestically, 8,660 units sold to other original equipment manufacturers (OEMs), and 28,633 units exported.
This increase in sales indicates that there is a continued demand for Maruti Suzuki vehicles, despite the increasing input costs that the company faces. The price hike is expected to affect future sales but is necessary to preserve profitability and ensure long-term sustainability.
Price Hikes From Other Automakers
Maruti Suzuki is not alone in hiking prices in reaction to the rise in costs. Hyundai Motor India Limited had, on December 5, decided to raise the prices of its model portfolio by up to ₹25,000, with the price rise taking effect from January 1, 2025. According to Hyundai Motor India Limited, it will be raising prices because of increased input, logistics, and transport costs as well as unfavourable changes in foreign exchange rates.
Tarun Garg, Whole-time Director and COO of HMIL, said, “The move was necessary to offset sustained cost escalation.” He also said that Hyundai tries to absorb as much cost as possible before passing it on to customers.
Similarly, on December 2, Audi India hiked the prices of its entire portfolio by 3%. According to the company, similar reasons were behind the price increase. The German luxury carmaker clarified that the price revision was essential for ensuring sustainable growth for both the company and its dealer partners.
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