Auto cos cite cost pressure amid strong dispatches

NEW DELHI : Major car makers have reported doubledigit growth in wholesale dispatches in March. While the conflict in West Asia has not dampened consumer demand in India, it has increased the cost pressure, companies said. Dispatches in last financial year (2025-26) also remained healthy.

Several auto makers, including Tata Motors, JSW MG, BMW, Mercedes-Benz and Audi have already announced price hikes from April 1, citing higher input and logistics costs, with increases ranging between 0.5% and 2%. Maruti Suzuki is also seeking to raise prices. Industry estimates (provided by Tata Motors and Maruti Suzuki) showed total passenger vehicle dispatches rose to about 47 lakh units in FY26 from 43.3 lakh in FY25, showing a growth of 8.2%.

Maruti Suzuki reported domestic sales of 18.2 lakh units in 2025-26. M&M recorded strong growth to sell 6.6 lakh units in FY26 to overtake Tata Motors and Hyundai, which sold 6.3 lakh units and 5.8 lakh units respectively.

Despite strong demand, companies flagged rising costs due to the uncertain geopolitical situation. “Cost pressures are the only headwind we are facing and we need to take a call on how much cost we need to pass on to the customer… right now we are absorbing the cost, but we cannot keep on absorbing it,” Partho Banerjee, head of marketing and sales, told TOI .

Industry executives said longer shipping routes and component costs are adding to pressure, though there was no change in production plans.

Gaurav Vangaal, associate director at S&P Global Mobility, said March volumes were boosted by year-end targets and festive demand but warned of cost pressures ahead. “Rising input costs, a weaker rupee and supply chain disruptions are set to weigh on demand in the months ahead,” he said.

“Growth momentum is expected to sustain, led by SUVs, CNGs and EVs. The industry will need to closely monitor geopolitical developments to mitigate potential supply-side risks,” Shailesh Chandra, MD and CEO of Tata Motors Passenger Vehicles, said.

Ravi Bhatia, president of JATO Dynamics India, said the demand base has strengthened post-GST 2.0, but risks remain.

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