Copper Price Surge Set to Make Electric Vehicles and Home Appliances Pricier
The price of copper has skyrocketed to over $14,000 a tonne, putting pressure on industries that rely heavily on the metal. Electric vehicles and home appliances are likely to become pricier as manufacturers struggle to absorb the increase in costs.
Indian industry leaders estimate that companies like Maruti Suzuki, Tata Motors, and Mahindra & Mahindra will face incremental monthly exposures of ₹204 crore, ₹171 crore, and ₹110 crore respectively. The surge in copper prices has left manufacturers with limited options: either absorb the increase, extract savings elsewhere, substitute materials, or pass on a part of the burden to consumers.
For white goods, the corresponding increase could reach ₹3,300-4,300 for a 1.5-tonne split air conditioner and ₹1,300-1,800 for a double-door refrigerator. In the agriculture sector, prices of copper sulphate have increased over six times from ₹80 a kg to ₹500.
Some companies are already passing on the cost increase to consumers. Avneesh Singh Marwah, CEO of SPPL, said 'All ‘A-Class components’, including copper, which are critical for production, have seen a surge in price. This has led to huge margin pressure for consumer appliance and electronics makers.' He added that his company will hike prices by 7 per cent this month and may consider another increase in the next quarter.