India-EU FTA: Mercedes-Benz India CEO says no price cuts possible on ‘Made in India’ models

Mercedes-Benz India MD and CEO Santosh Iyer says FTA will strongly drive technological innovation within the Indian automotive sector

New Delhi: The India-EU FTA will strongly drive technological innovation within the Indian automotive sector, Mercedes-Benz India MD and CEO Santosh Iyer said on Tuesday, while ruling out any price reduction of the company’s vehicles in the foreseeable future after the deal.

Terming the Indo-EU FTA as a historic achievement for India, Iyer said the pact reiterates the “rising relevance of the Indian economy at a global stage”. “The FTA is also expected to strongly drive technological innovation and sustainable growth within the Indian automotive sector, with a sharp focus on future mobility. Saying that, the final implications of the FTA can only be determined once the fine print of the agreement is available to us,” he added.

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On the impact of the FTA on prices of vehicles, Iyer said, “With more than 90 per cent of Mercedes-Benz India’s sales volume comprising ‘Made in India’ locally manufactured models, and only around 5 per cent of sales coming via CBU imports from the EU, we do not foresee any price reduction for Mercedes-Benz vehicles from the FTA, in the foreseeable future”.

“We will continue our focus on value addition to customers through local production and competitive pricing, making world-class vehicles in India, for Indian customers.” Mercedes-Benz India pointed out that the depreciating rupee against the Euro would continue to pose a challenge for European carmakers in India.

The rupee had depreciated by 19 per cent in 2025 compared to the euro, which is expected to erode any benefit arising from lower duty import for CBUs in the next couple of years.

Stating that Mercedes-Benz has always advocated free trade, he said it brings down trade barriers, leverages the mutual strengths of global economies, and mitigates supply chain uncertainties.

“With the Indo-EU FTA, India’s economic growth should get a strong boost as borders open up, presenting opportunities in new markets, fostering bilateral trade, and creating job opportunities,” Iyer noted.