Companies Hike AC Prices Amid Rising Summer Demand

As the summer heat begins to intensify and people look to buy air conditioners (ACs) for relief, companies are simultaneously increasing their prices. According to manufacturers, the rise in prices is mainly due to the increase in the cost of key raw materials such as copper, the weakening of the Indian rupee against the US dollar and changes in AC star-rating standards related to energy consumption.

In addition, several important components used in AC manufacturing are imported from abroad and the depreciation of the rupee further increases the cost burden on companies. Manufacturers also state that production costs have gone up as ACs must now comply with new energy efficiency standards. As a result, industry sources estimate that AC prices may increase by about 5 to 15 percent. It is estimated that around 13.5 million AC units are sold annually in India. Meanwhile, the Bureau of Energy Efficiency (BEE) introduced new regulations that came into effect on January 1 this year. Under these norms, the new 5-star room ACs are expected to save around 10 percent more electricity compared to older models.

Several major companies have already announced price hikes for their AC models. Daikin India stated that it will increase prices by up to 12 percent from April, according to Chairman and MD Kanwaljeet Jawa. Tata Group’s Voltas has announced a price increase of 5 to 15 percent. LG Electronics India will raise prices by 7 percent for 3-star models and by 9 to 10 percent for 5-star models, said Director Sanjay Chitkara. Haier India has already increased prices by 5 percent for 3-star ACs and by 8 percent for 5-star models from March, according to President NS Satish. Mitsubishi has also increased prices by about 5 percent, said Director Pradeep Bakshi. Meanwhile, Blue Star raised AC prices by 8 to 10 percent as early as mid-February.