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Tata Hitachi Plans October Price Hike Amid Cost Pressures
Tata Hitachi makes machines used for construction projects.
It plans to make these machines more expensive starting October 1.
The company says materials have become more costly this year.
However, it may not raise prices enough to cover all of those higher costs.
Tata Hitachi still expects its business to grow by 14-15% this financial year.
Selling machines abroad has become harder because shipping costs have increased and some equipment is delayed in transit.
The company does not currently need to build more production capacity.
It is also trying to make more machine parts in India.
Government support for construction equipment could help local suppliers and manufacturers.
Tata Hitachi will raise prices again from October 1 to offset rising input costs.
The company expects annual price increases of about 2.5%, below the 3.5-4% needed to fully absorb commodity-cost increases.
Commodity prices have risen 5-6% this year, while Tata Hitachi has implemented a 1.25% increase so far.
Tata Hitachi expects 14-15% growth this financial year despite export disruptions, higher logistics costs and geopolitical tensions.
The company operates at about 70% capacity utilisation, produces roughly 9,000 machines annually and has about 65% localisation.
- Who
- Tata Hitachi and its Managing Director Sandeep Singh.
- What
- Tata Hitachi will implement another price increase and continue efforts to manage higher costs and supply-chain pressures.
- Where
- The company operates in India and exports to West Asia, Africa and Southeast Asia; shipping disruptions include routes between Mumbai and Dubai.
- When
- The price increase will take effect on October 1; the article also discusses the current financial year and FY26 industry data.
- Why
- To offset rising input and commodity costs, while geopolitical disruptions and higher freight charges are pressuring exports.
Key facts
- Price increase date
- October 1
- Expected annual price hike
- Around 2.5% at most
- Commodity price increase
- 5-6% this year
- Price increase already implemented
- 1.25%
- Expected company growth
- 14-15% in the current financial year
- Annual production and exports
- About 9,000 machines produced and 700-800 exported annually
- Capacity utilisation
- Around 70%
- Localisation
- About 65%, increasing by 2-3 percentage points annually
Quotes
Sandeep Singh
Managing Director of Tata Hitachi
“So it will be a good scheme because it will open markets for some of our vendors and for us.”
financialexpress.com
“Assume if the Mumbai to Dubai vessel was costing $600, today they are costing $6,000.”
financialexpress.com
Sources
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