Mercedes-Benz India, the domestic arm of German luxury auto maker, has announced to increase the prices of its entire Indian portfolio with effect from April 1. Reportedly, this hike will accumulate a sum of up to Rs. 58 lakh on all the imported models of the auto maker. The company said in a statement, on locally produced models, the increase is likely to take place between 1 and 4 per cent and reach up to 20 per cent on Completely Built Units (CBUs). Reportedly, the auto maker offers a wide array of models, starting from B-Class to SLS AMG, in a price bracket from Rs. 21 lakh to Rs. 3 crore.
However, the auto maker did not disclosed the model wise increase in the prices, but individuals close to the process revealed that the highest increase would be implied on the SLS AMG, which happens to be an imported luxury sports car. Meanwhile, it must be noted that at present, Mercedes-Benz assembles its much acclaimed C Class, E Class and S Class saloon, along with M Class Sports Utility Vehicle (SUV) at its Chakan factory, near Pune.
On this new move of the auto company, the Managing Director and Chief Operating Officer of Mercedes-Benz India, Eberhard Kern was quoted as saying, “There are several factors that have put significant pressure on our bottom lines. Rising input costs and volatile exchange rates have impacted us, while the recent changes in import duty structure and increase in relevant taxes have put significant stress on our business. We have absorbed a portion of the impacts but to retain business viability, we are forced to pass on a part of this burden to the consumers.”
Industry experts believe that this hike has been announced because of increase in the excise duty, which was proposed by the Finance Minister P Chidambaram in the Union Budget. Reportedly, the Finance Minister has also declared an increase in the basic customs duty on the purchase of new passenger cars and other vehicles, which have an engine capacity of more than 3000 cc for petrol and 2,500 cc for diesel or a price tag of over USD 40,000. On such vehicles, the excise duty has been increased from 75 per cent to 100 per cent. Also, the excise duty on SUVs has been increased to 30 per cent from 27 per cent earlier.