Mercedes-Benz India to hike prices by up to 2% from January 1

Mercedes-Benz India on Friday announced a price hike of up to 2 per cent across its entire model range, effective January 1, 2026. The carmaker attributed the move to rising operational expenses and persistent foreign exchange volatility through 2025.

The company said the adjustment had become unavoidable amid sustained cost pressures. “The price correction capped at 2 per cent, reflects sustained forex pressures that have characterised the luxury automotive landscape throughout 2025,” the luxury carmaker said in a statement.

Forex volatility and rising costs push prices up

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According to the company, the Euro staying above the Rs 100 mark for most of the year has significantly strained its cost structure. The stronger European currency has driven up expenses on multiple fronts—from imported components used in locally assembled vehicles to the cost of fully built imports.

In addition, rising input and material costs, higher logistics charges and general inflation have pushed operational spending even higher. Mercedes-Benz India Managing Director and CEO Santosh Iyer noted that the currency situation has been “tougher and longer than expected”.

Despite this, he stressed that the company is transferring only a minimal portion of the burden to customers, while absorbing most of the impact internally.

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Financing support to cushion impact

Mercedes-Benz Financial Services (MBFS) will continue to offer flexible financing plans to help customers manage the upcoming price hike. Since about 80 per cent of Mercedes-Benz buyers in India use financing and MBFS handles nearly half of all the brand’s sales, the company expects these options to reduce the impact of the higher prices.

“With 80 per cent of Mercedes-Benz purchases in India involving financing, and MBFS directly facilitating approximately 50 per cent of total brand sales, Financial Services plays a pivotal role in driving ownership ecosystem for Mercedes-Benz,” the company added.

Also Read: Mercedes Benz India Price Cut List: After GST 2.0, luxury carmaker announces up to Rs 11 lakh discounts; see model-wise rates

Mercedes-Benz also highlighted that recent repo rate cuts by the Reserve Bank of India have allowed MBFS to pass on benefits to customers, easing the impact of the forthcoming price adjustment. The Reserve Bank of India (RBI) cut its repo rate by 25 basis points to 5.25 per cent during the Monetary Policy Committee (MPC) meeting held December 3-5, 2025.