German luxury carmaker BMW plans to raise vehicle prices from next month to mitigate the impact of the rupee’s depreciation against the euro, President and CEO Hardeep Singh Brar said on Thursday.
The company had earlier announced a price increase of up to 3 per cent effective September 1 this year, citing persistent forex volatility and global supply chain challenges.
BMW’s India portfolio spans luxury cars and SUVs, including electric models, starting with the 2 Series Gran Coupe at Rs 45.3 lakh and going up to the XM priced at Rs 2.54 crore.
“Forex fluctuation is a big dampener. We were looking at somewhere about 93 to 95 (rupee against euro) this year, but it is actually around 103 to 105, so it's about 10 per cent deterioration versus our expectation. So that puts a lot of pressure on pricing and profitability,” Brar told PTI.
He said the company had not intended to raise prices due to the new GST rates, but the rupee’s sharp slide has intensified pressure on margins.
“The Euro has been extremely unfavourable. The 10 per cent deterioration is really putting a lot of pressure on our bottom line. So, considering that we have to look at the price increase. It could come in January,” Brar said.
“We are being forced, otherwise, there were no plans. Given the forex situation, it is really becoming difficult to sustain at these price levels,” he added.
Earlier this year, Mercedes-Benz India also indicated that it is considering price revisions in early 2025 to counter the rupee’s weakness against the euro.
The rupee has been declining against major global currencies, including the US dollar and the euro. On Thursday, it fell 54 paise to a record low of 90.48 against the dollar in intra-day trade amid reports that the India-US trade deal could materialise by March 2026.
Forex dealers noted that the rupee hit a fresh low of 90.48 after Chief Economic Advisor V Anantha Nageswaran reportedly said the trade agreement could be signed by March. They added that risk-averse market sentiment and strong dollar demand from importers further weighed on the currency.
