A weakening rupee is set to trigger another round of price hikes at Mercedes-Benz India, with the luxury carmaker confirming its third increase this year as euro-linked costs continue to rise, according to Managing Director and CEO Santosh Iyer.
Iyer said the rupee has weakened by nearly 15-20% against the euro over the past 12-18 months, significantly increasing the cost of imported components and completely built units (CBUs).
“While the company has attempted to offset the impact through higher localisation and cost optimisation, the euro hovering around Rs 110 has made another price revision inevitable,” he said.
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The German luxury carmaker had increased prices by 3-4% last year and has already implemented two rounds of hikes totalling about 4% in 2026.
A third increase is now on the cards, although the company said it remains focused on minimising the burden on customers.
On its product strategy, Mercedes-Benz reiterated that it is pursuing a technology-neutral approach rather than betting exclusively on electric vehicles.
Iyer said EV adoption continues to gain traction, accounting for nearly a quarter of sales in the company's top-end portfolio and about 22% in the new CLA segment.
However, around three-fourths of luxury buyers are still hesitant to make the switch, citing concerns over charging infrastructure, driving range and residual values.
To bridge that gap, the company is expanding its focus on plug-in hybrid models, which combine electric driving capability with the flexibility of a conventional combustion engine.
Iyer said the latest AMG plug-in hybrid can travel up to 100 kilometres on electric power alone while retaining high-performance characteristics, making it an attractive option for customers not yet ready to go fully electric.
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Mercedes-Benz also said it has been preparing its vehicles for higher ethanol blending levels.
Since the BS-VI transition, all its cars sold in India have been E20-compliant, while every new Mercedes launched from January this year is compatible with E25 fuel.
The company added that recent concerns over fuel quality stem from isolated cases of contamination rather than ethanol blending itself.
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