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​Automobile Desk: If you are planning to buy a new car, then it may prove beneficial for you to take this decision soon. Before the upcoming festive season, major vehicle manufacturing companies of the country are preparing to increase the prices of vehicles. The main reason for this is the sharp increase in the cost of raw materials used in the manufacturing of vehicles. The margins of the auto sector are being affected due to the sudden rise in prices of commodities like steel, rubber, copper and aluminium.

​The start of FY27 has been quite positive for the Indian automobile market in terms of demand. Good pace has been seen in the sales of passenger vehicles, two-wheelers and commercial vehicles. However, the continuous increase in construction costs has created a serious crisis for the companies. Now companies are left with only two options – either they reduce their profits by bearing the burden of this additional cost, or they increase prices, passing its impact directly on the customers' pockets.

​Leading industry experts in the commercial vehicle sector believe that steel alone accounts for about 40 percent of the material used in manufacturing vehicles. Due to import duty and international market conditions, there is little hope of any major relief in steel prices at present. Apart from this, a significant increase has also been recorded in the rates of rubber, aluminum and copper. Especially due to the increasing manufacturing of electric vehicles (EVs), the demand for copper has increased significantly, due to which its prices are also skyrocketing.

​This increasing cost pressure is not limited to vehicle manufacturers only, but is also having a deep impact on auto parts manufacturing companies and the tire industry. According to component manufacturers, power, transportation and labor costs have also increased in recent months. Due to this, tire manufacturers have already started revising the rates and have hinted at further increases in the times to come.

​If we talk about figures, within the last few months, the prices of natural rubber have increased by more than 50 percent, that of steel by more than 20 percent and that of copper by almost 10 percent. This is the reason why big companies like Maruti Suzuki and Honda have recently increased the rates of their select models, while many other big companies are considering implementing new rates in the coming days. Some companies are currently trying to avoid price rise by controlling their internal costs, but it does not seem possible to handle this situation in the long run.

​The festive season in India is considered to be the most important business time for the auto industry, when the highest sales of vehicles are recorded. In such a situation, if companies increase the rates, it can have a direct impact on the decision-making ability of customers. At present, companies are trying to balance cost management and limited price increase, but considering the trend of raw materials, it is almost certain that the price of vehicles will increase in the coming weeks.