Maruti hints at more price hikes as company yet to recover from rising input costs
Shashank Srivastava, Executive Director at Maruti Suzuki India, in an interview with CNBC-TV18, said, "We have not really fully covered for the increased commodity prices, even with a 10 percent increase because the price increases for the commodity prices have been huge."
Maruti Suzuki on Monday said that the auto major has not completely recovered from the rising commodity prices despite the 10 percent price increase it has implemented so far in the last one year, hinting at more hikes going forward.
“We have not really fully covered for the increased commodity prices, even with a 10 percent increase because the price increases for the commodity prices have been huge and they have not softened," said Shashank Srivastava, Executive Director at Maruti Suzuki India, in an interview with CNBC-TV18.
"So, we keep watching the situation as we go along and remember the material cost is about 75-78 percent of the cost structure of an auto OEM and therefore a change in commodity prices obviously has a large impact on the overall cost structure,” he added.
In its latest price increase in April, the country's top car seller announced a hike "across models owing to increase in various input costs".
The company sells a range of models including Alto, S-Presso, Wagon R, Celerio, Swift, Eeco, Dzire, 2022 Ertiga in the domestic market.
"The weighted average increase across models is 1.3 percent - Ex-Showroom Prices (Delhi)," the company had said while making the announcement.
According to Autocar India, the revised prices of Maruti models are as follows:
Arena models price hike
| Model | Old Price (ex-showroom, Delhi) | New Price (ex-showroom, Delhi) |
| Alto | Rs 4,02,696 | Rs 4,08,000 |
| S-Presso | Rs 4,37,241 | Rs 4,43,000 |
| Swift | Rs 5,84,205 | Rs 5,91,900 |
| Wagon R | Rs 5,40,382 | Rs 5,47,500 |
| Eeco | Rs 4,57,178 | Rs 4,63,200 |
| Celerio | Rs 5,18,175 | Rs 5,25,000 |
| Dzire | Rs 6,15,888 | Rs 6,24,000 |
| Vitara Brezza | Rs 7,73,808 | Rs 7,84,000 |
Nexa price hike
| Model | Old Price (ex-showroom, Delhi) | New Price (ex-showroom, Delhi) |
| Ciaz | Rs 8,87,806 | Rs 8,99,500 |
| Ignis | Rs 5,28,045 | Rs 5,35,000 |
| S-Cross | Rs 8,83,365 | Rs 8,95,000 |
| Baleno | Rs 6,40,563 | Rs 6,49,000 |
Srivastava said the April price increase has not been factored in. However, he said the slight improvement in margin reported in the fourth quarter of FY22 can be attributed to price hikes the company has taken so far.
Among the other factors that have helped the company post better numbers in the last quarter were lower sales promotion expense, weaker yen and stable rupee.
The company on Friday reported a net profit of Rs 1,838.9 crore for the January-March period, up 57.7 percent on a year-on-year basis, exceeding Street estimates.
Revenue of the carmaker rose 11.3 percent to Rs 26,740 crore compared with the corresponding period a year ago, according to a regulatory filing.
The auto major's sales volume came in at 4.89 lakh units in the three-month period, as against 4.92 lakh units in the year-ago period, according to the filing.
The company said adverse commodity prices continued to hurt.
Srivastava said the supply-side concerns owing to shortage of electronic components remain a big issue and that challenges are expected to continue in this quarter as well.
"Apprehensive to say when the supply side challenges will abate," he said.
Sales of Maruti Suzuki reduced by 5.6 percent in April with the total number being 1,50,661 units compared to 1,59,691 units in the same month last year.
First Published: May 2, 2022 5:07 PM IST
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