A Leading Automotive Company Announces Price Hikes
Toyota Kirloskar Motor (TKM), an automotive company, announced on Saturday that starting from April 1, 2022, it will hike up the pricing of its vehicles by up to 4%. The manufacturer claims that the increase is due to growing input costs, especially raw material costs.
In a statement, TKM stated, “As a devoted and customer-centric firm, TKM has made all intentional measures to minimize the impact of increased prices on consumers.” BMW India announced on Friday that prices throughout its range of models will highly increase by up to 3.5 percent starting from April 1.
The price rise will be implemented to adapt procurement and transportation costs, as well as the effects of the present geopolitical environment and exchange rates, according to the company. Mercedes-Benz India, another premium carmaker, has already announced an increase in the price of its whole model range, effective April 1.
According to Mercedes-Benz India, the upcoming price adjustment will be in the range of 3% across the full model range. According to the corporation, persistent increases in input prices, as well as increased logistical charges, have put tremendous pressure on the company’s total costs.
Will These High Prices Persist?
Owing to the COVID-19 outbreak, a scarcity of computer chips, and some other supply-chain issues, auto manufacturing declined dramatically between 2020 and 2021. As a result, there are more than enough pent-up consumer demands and industrial fleets in 2022 and 2023 to absorb increased output.
Auto manufacturers can probably construct an extra 2.6 million to 3.2 million vehicles this year compared to 2021, but forecasts say it won’t be enough to put supply back on course with demand. In other words, price hikes are likely to remain throughout this year, and maybe into next year, as demand continues to surpass supply.