Mercedes-Benz India on December 10, 2012, gave a hint that the prices of the company's entire portfolio will be revised effective January, 2013. Continuous increase in input costs combined with unfavourable exchange rates and prevailing inflation has had negative impact on the company’s profit margins.
Eberhard Kern, Managing Director & CEO, Mercedes-Benz India said, “Significant level of cost escalations have been absorbed by us till now, but beyond a point we cannot continue to sustain such levels. We have made substantial investment in our India operations and are responsible for the growth of our employees and dealer partners. We aim for a sustainable profitable growth maintaining our premium appeal and hence, we are going to substantially increase the prices of all Mercedes-Benz cars from January 2013.”
Mercedes-Benz India is making an overall investment of Rs. 850 crores in its production facility at Chakan in Pune in addition to Rs. 480 crores invested by the company's dealer partners in its network. Mercedes-Benz India currently has the largest number of dealership network among the luxury car makers in the country with 72 touchpoints across 31 cities. The German car maker operates two shifts and is capable of producing 10,000 vehicles every year. The company locally manufactures the E-Class, C-Class, S-Class sedans and has from October this year even started the local production of the M-Class. The luxury car maker from October 2012 has also started the operations of its Paint Shop, which is technologically very advanced and has a capacity of 20,000 units annually.
