Tata Motors to raise prices of passenger cars by 1.2%
BENGALURU (Reuters) -Indian carmaker Tata Motors Ltd said on Friday it would hike prices of its passenger vehicles by 1.2% on a weighted average basis from Feb. 1, citing a rise in overall input costs.
The price increase comes a month after the maker of the Tiago and Harrier cars raised commercial vehicle prices by up to 2% in January..
Earlier this month, rival and India's top car maker Maruti Suzuki raised prices by an average of 1.1% across its models, blaming similar cost pressures.
"The company has been absorbing a significant portion of the increased costs on account of regulatory changes and rise in overall input costs and is hence passing on some portion through this hike, Tata Motors said in a statement.
India has mandated automakers to comply with stricter fuel efficiency norms from April this year and will also require all cars to have six airbags by October.
Meanwhile, even as key commodity prices have come off record levels, auto makers have been resorting to price hikes to shore up margins in a high-inflation environment.
India's headline inflation has stayed above the central bank's tolerance level of 2%-6% for the better part of the year, cooling only in the past two months.
The Jaguar Land Rover owner posted its first profit in two years earlier in the week.
(Reporting by Nandan Mandayam and Anisha Ajith in Bengaluru; Editing by Savio D'Souza and Nivedita Bhattacharjee)