- Indian tyre maker JK Tyre & Industries expects to raise product prices by a total of 11% to 13% by the end of September to offset rising input costs, its finance chief said, joining rivals in passing on higher expenses to customers.
The hikes reflect pressure across the auto-parts sector after an oil price rally linked to the Middle East conflict drove up the cost of petroleum-based inputs, energy and freight.
Read more: JK Tyre plans 11%-13% price hikes by September-end
The tyre maker, which said in May it expects to raise prices by 5% to 6%, has since rolled out hikes every month in the first quarter and plans to increase prices by a further 5% to 6% in the coming two to three months, CFO Sanjeev Aggarwal told Reuters on Wednesday.
"Prices (of raw materials) have gone through the roof and for us, it went up by almost over 20%. So, that has impacted business in this quarter," Aggarwal said, citing West Asia tensions, transport disruption and supply-chain constraints.
Raw materials such as natural rubber, synthetic rubber, carbon black and steel make up about two-thirds of expenses for the company, which counts leading car makers Maruti Suzuki India and Tata Motors among its customers.
The move brings it in line with rivals Apollo Tyres and CEAT, which have also raised prices. Top Indian car makers have passed on the costs to customers.
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Industry data released earlier this month showed vehicle sales rose 21.8% in June, signaling strong demand across passenger and commercial vehicles and giving tyre makers more room to raise prices.
