Most carmakers will be increasing prices in January 2023 due to rising commodity prices and upcoming RDE emission norms and new safety standards
Over the past two years, car prices have increased multiple times. 2023 doesn’t seem any different, as most carmakers have announced price hikes from January. Key reasons include rise in commodity prices and transportation costs as well as expenses linked to compliance with upcoming RDE (Real Driving Emissions) norms. 6-airbags will become mandatory from October 2023, which will be another major cost component.
Even though supply chain issues have eased in comparison to earlier times, the residual impact of inflation continues to increase commodity prices. Carmakers do try to absorb the impact of high commodity prices, so as not to disturb the sales momentum. However, some of the cost burden is eventually passed on to end users.
Maruti, Tata, Kia price hike
Maruti has announced that prices will be increased across the range from January 2023. Price hike will vary based on the specific model. In its official note, Maruti has talked about rise in commodity prices and stricter regulatory requirements. These factors have forced the company to increase prices in January 2023. Maruti’s bestsellers include Alto, Alto K10, Ignis, WagonR, Celerio, S-Presso, Swift, Eeco, Dzire, Brezza, Ciaz, Ertiga, XL6 and Grand Vitara.
Tata price hike in January will be applicable on both ICE cars and EVs. The company has pointed out high commodity prices, as one of the key reasons for the price hike. Tata has also talked about the cost of complying with upcoming RDE norms. In case of EVs like Nexon EV, Tiago and Tigor EV, the cost impact is primarily due to increase in battery prices. As the world is making the shift to electric, battery prices will continue to move north until an equilibrium between demand and supply is achieved.
Kia India has stated that it will be increasing prices by Rs 50,000 from January 2023. According to Kia, primary reasons for the price hike include increased commodity prices and rise in transportation costs. Price hike will be applicable for all Kia cars booked after December 31. Kia is currently the fifth largest carmaker in India. It has a healthy portfolio with popular options such as Sonet, Seltos and Carens. It also offers Carnival and EV6.
Renault, Citroen, Jeep price hike
All three carmakers have linked the upcoming price hike primarily to a rise in input costs. Renault’s India portfolio comprises Kwid, Kiger and Triber. In case of Jeep, prices will be increased in the range of 2 to 4 percent. Jeep India portfolio has Compass, Wrangler, Meridian and newly launched Grand Cherokee.
Citroen has C3 and C5, which will witness a price hike in the range of 1.5 to 2 percent. Next product from Citroen is expected to be the electric version of C3 that has been spotted on road tests. Launch is likely to take place at 2023 Auto Expo. It will primarily rival Tata Tiago EV and upcoming MG Air EV.
Audi, Mercedes-Benz price hike
Audi has attributed the price hike primarily to rise in input and operational costs. The German carmaker will be increasing prices across the range by up to 1.7%. Audi’s India portfolio comprises A4, A6, A8 L, Q3, Q5, Q7, Q8, S5 Sportback, RS 5 Sportback, RSQ8, e-tron, e-tron Sportback and e-tron GT.
Mercedes-Benz will be increasing prices across the range by 5%. Reasons are the same as other carmakers have stated. Mercedes-Benz India portfolio has A-Class, A-Class hatchback, C-Class, E-Class, S-Class, EQB, EQC, EQS, GLA, GLB, GLC, GLC Coupe, GLE, GLE Coupe and GLS, G-Class. There are two Maybach models – GLS and S-Class.