Xiaomi Might Hike the Prices of its Smartphones Due to Rupee Depreciation

Xiaomi, which launched three new smartphones under its Redmi lineup earlier today said that it would decide on price hikes for its smartphones after evaluating the impact of rupee’s slide against the dollar. At the end of the launch event, Xiaomi was all set to reveal the prices of the Redmi 6A, Redmi 6 and Redmi 6 Pro, but this is when the interesting thing happened. After announcing the prices, Xiaomi said that these are introductory prices for the first two months and if the rupee value slides against the dollar in the future, then Xiaomi will increase the prices of its smartphones.

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“The prices (of phones launched) do take into account the impact…the rupee is at about 71, it takes into account that. This is an introductory price with Diwali coming up. Post that (Diwali), we will evaluate,” Xiaomi India Head (Category and online sales) Raghu Reddy told PTI.

Mobile Components are Bought from Suppliers from Japan, US and Other Countries

He explained that manufacturing locally in India helps in this situation as supply chain efficiencies allow passing on the benefit to consumers. However, a large part of the components are paid for in dollars as they are bought from suppliers from locations like Japan, Taiwan and the US among others.

“As the USD continues to strengthen, your costs go up,” Reddy added. While he declined to comment on the quantum of impact on the manufacturing cost, Reddy said the company would have to evaluate its entire portfolio and take a call on whether prices need to be revised.