Mercedes-Benz India is weighing the option of raising vehicle prices every quarter in the next calendar year as it looks to cushion the impact of a sharply
weakening rupee against the euro, according to the company’s Managing Director and Chief Executive Officer Santosh Iyer. The luxury carmaker has already announced a price increase of up to two per cent across its product portfolio, effective January 1, 2026. This initial hike, the company said earlier, is aimed at partially offsetting persistent foreign exchange headwinds, with the euro-rupee exchange rate remaining above the Rs 100 level through most of 2025, well above historical averages. Speaking to PTI on the sidelines of the FICCI Mercedes-Benz Bharat Innovation business ideas challenge programme launch, Iyer said the company is now evaluating a staggered pricing strategy for the rest of 2026. “We are considering a price hike every quarter next year and that is because of rupee devaluation to the euro,” he said. Highlighting the extent of currency movement, Iyer noted that around 18 months ago, the euro was trading at approximately Rs 89. “Now it is around Rs 104–105. That is more than 15–18 per cent of depreciation,” he said, underlining the significant cost pressure faced by companies with a high import component. Mercedes-Benz India imports a substantial portion of its vehicles and components, making it particularly sensitive to currency fluctuations. While the January price hike has already been announced, Iyer indicated that further increases are likely through the year to gradually absorb the impact of the rupee’s depreciation. “There is more than a 10–15 per cent gap between the actual impact of rupee depreciation and the price hikes we have taken so far,” he said. “So we are spreading the increases; otherwise, demand may also get affected.” The company has not yet finalised the exact quantum of price hikes for each quarter of 2026. However, Iyer suggested that the increases could be in the range of around 2 per cent per quarter, depending on how currency movements and market conditions evolve. The measured approach reflects Mercedes-Benz India’s attempt to strike a balance between protecting margins and sustaining customer demand in a highly competitive luxury car market. By spacing out price increases, the company aims to reduce the immediate burden on buyers while responding to prolonged forex volatility. The proposed quarterly hikes, if implemented, would mark a shift towards more frequent price adjustments, mirroring the growing uncertainty in global currency markets and their impact on the Indian automotive industry.
