Rising input and supply chain costs push luxury carmaker Audi to hike prices by 2.4%
- Luxury cars’ price tags are about to get fatter as automaker Audi increases the prices of its models for the second time in four months.
- Due to rising input and supply chain costs, Audi will be increasing its prices yet again by 2.4%.
- In April, luxury auto makers Audi and Mercedes-Benz had increased their prices by 3%.
AdvertisementLuxury car Audi is about to get a tad more expensive, as the automaker increases its prices for the second time in four months.
The German luxury car manufacturer on Tuesday announced a price hike of up to 2.4% across its model range in India, effective September 20. This will see the cost of Audi Q7, for instance, rising to ₹83.96 lakh from ₹82.49 lakh currently.
The current price jump is aligned with the festive season, which usually bumps up sales of luxury automobiles.
“At Audi India, we are committed to operating a sustainable business model. With rising input and supply chain costs, we are required to take a price hike of up to 2.4% across our model range,” said Balbir Singh Dhillon, head of Audi India.
The cost of raw materials required to manufacture cars has shot up after the war in Ukraine – aluminium is costlier by 48%, palladium by 38%, rhodium by 35%, platinum by 13%, rubber by 28% and copper by 15% compared to the second half of 2021.
In April, Volkswagen group firm Audi and its rival, Mercedes-Benz India, had increased their prices by 3% due to high input and logistics costs. Luxury automakers are still struggling with the increasing input costs in India and are passing on the additional expense to consumers. The luxury automobile industry has also been dealing with the pandemic’s after-effects, which reduced footfalls at the showrooms.
Despite the price increase, Audi’s sales for the first six months of the year grew at a healthy 49% over last year, thanks to new product launches, and demand for its Audi e-tron range, Audi Q5, Audi Q7, Audi A4, Audi A6 and S/RS models.
The German auto major also said that it had retailed 1,765 units in the January – June 2022 period, buoyed by electric vehicles.
According to market research firm Mordor Intelligence’s report, the Indian luxury car market was valued at $1.06 billion in 2021 and this is expected to grow to $1.54 billion by 2027, at a CAGR of over 6.4%.
In FY21, BMW, Audi, Jaguar Land Rover and Volvo had the highest growth among the luxury car manufacturers, according to Mordor Intelligence.
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