Mercedes-Benz India will increase prices across its model range by up to 2% from January 1, 2026, as the company moves to manage sustained operational cost pressures and the prolonged impact of forex volatility. The adjustment will apply to all ex-showroom prices, with the quantum varying by model depending on levels of localisation and import dependence.
The company said the decision reflects a year in which the Euro-INR exchange rate has consistently remained above the Rs 100 mark, diverging sharply from historical averages and affecting sourcing costs across its supply chain.
Explaining the underlying cost environment, Mercedes-Benz India MD and CEO Santosh Iyer said: "Currency headwinds have persisted longer than we anticipated this year, with the Euro consistently trading over the Rs 100 mark. This prolonged volatility affects every aspect of our operations, from imported components for local production, to completely built units. In addition, rising input costs, increasing logistical expenses, in combination with inflationary costs have significantly risen our overall operational costs."
"Thanks to RBI's continuous repo rate reduction, enabling Mercedes-Benz Financial Services to pass on the benefits to end customers, thereby mitigating the price increase effect to a large extent," he added.
Despite these pressures, the company said it continues to absorb the majority of the increased cost load, passing only a marginal portion to the market through the upcoming revision. However, the brand is also evaluating further quarterly price adjustments in 2026 to stay aligned with prevailing forex levels. These possible revisions will depend on the magnitude and persistence of Euro-INR movement and will serve as a mechanism to manage volatility rather than functioning as broad annual increases.
Mercedes-Benz Financial Services (MBFS) will continue to support customers through tailored financing products that help reduce the EMI impact of the price hike. With about 80% of Mercedes-Benz vehicles in India purchased on finance and MBFS facilitating roughly half of those transactions, the company expects financing solutions to remain a stabilising factor in overall ownership costs even as prices move upward from January.
The new prices will apply to all customer deliveries beginning January 1, 2026, while future quarterly adjustments will be determined by currency trends and cost conditions across the supply chain.
On December 11, news agency PTI reported that BMW India was also looking to hike vehicle prices from next month to offset the impact of the weakened INR against the Euro.
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