TVS Motor signals price hike in Q2 to offset commodity inflation

TVS Motor Company has indicated that it will consider price increases in the second quarter to offset rising commodity costs, while continuing to invest in its super premium Norton brand.

Speaking during the company’s earnings call on Tuesday, the company’s Director and Chief Executive Officer KN Radhakrishnan said the sharp increase in steel, aluminium and petroleum-linked input costs during the June quarter, triggered by the West Asia conflict, had put pressure on margins.

“There was a sharp upward trend in commodity prices during Q1. We are closely watching the situation and will appropriately look at opportunities to rightly give price increases,” he said. Cost optimisation and management scale benefits will continue in the second quarter, he added.

TVS also reaffirmed its long-term commitment to the super premium motorcycle segment through Norton Motorcycles, saying it has invested about ₹2,500 crore over the past four to five years in reviving and expanding the British brand.

The company is preparing to launch four new Norton motorcycles across global markets, including the UK, Europe, the US and India, he said without giving information on the launch date.

The upcoming Norton range will include motorcycles across superbike, naked sport, adventure and sport-touring segments, he added.

The go-to-market strategy would combine dedicated premium dealerships with select multi-brand outlets depending on the country, while expanding the distribution network in phases, said Radhakrishnan.

The Norton strategy complements TVS Motor’s broader premiumisation plans, alongside brands such as Apache and Ronin, which the company expects will support both revenue growth and profitability over the medium term.

In June, Norton Motorcycles marked the roll-out of the first Atlas models at TVS Motor Company’s Hosur manufacturing facility in India.

TVS is investing around ₹3,500 crore this fiscal towards new product development and capacity expansion, including premium motorcycles, electric vehicles and manufacturing capacity.

TVS would increase its annual two-wheeler manufacturing capacity to 8.3 million units from the current 6.8 million units by the fourth quarter of the current financial year. The company is also expanding annual three-wheeler capacity from 2.5 lakh units to 4.2 lakh units, while scaling up electric vehicle production, said Radhakrishnan.

TVS is raising its monthly electric scooter production capacity from 40,000 units to over 50,000 units, while electric three-wheeler capacity is being increased from 20,000 units to around 30,000 units a month, he said.