TL;DR
Mercedes-Benz India's CEO states that luxury car prices will likely increase, not decrease, despite the India-EU FTA, due to delayed implementation and currency depreciation.
Despite widespread anticipation that the recently formalized Free Trade Agreement (FTA) between India and the European Union would lead to a reduction in luxury car prices, Santosh Iyer, Managing Director and CEO of Mercedes-Benz India, has indicated that prices are more likely to increase. He clarified that consumers expecting significant price drops will be disappointed, as external economic pressures are set to drive prices steadily upwards in the coming months.
Iyer explained that the belief of immediate price reductions is an overhyped phenomenon due to the extended timeline for the FTA's implementation and the ongoing depreciation of the Indian rupee against the Euro. While the FTA aims to gradually reduce import tariffs on fully built imported cars from the current 35% to 10%, this reduction is not expected to take effect for at least 18 to 24 months.
