According to top luxury car makers Audi, BMW and Mercedes Benz, the new boom in India is in the price range from Rs. 25-30 lakhs. This comprises of small vehicles that would appeal to the younger and aspiring generation, as currently the above mentioned car markers have vehicles above the price of Rs. 30 lakhs. It is expected that Mercedes-Benz India may get 40 to 50 per cent of its sales from vehicles in the Rs. 25-30 lakhs price range, in the next five to six years.
Commenting on the new development, Debashis Mitra, Director of Sales and Marketing at Mercedes-Benz India said, “Consumers no longer want to compromise on the brand. The young consumer wants to touch a luxury brand far earlier in life and not settle for a mass brand.” In fact, one feels that this is also a sign of the market maturing in India.
Mercedes-Benz has plans to launch to B-Class, which is a compact sports tourer and the A-Class, which would be positioned as a small premium hatch. BMW India would be launching the 1-series in 201 in a similar category and Audi India is slated to come up with the A3. B-Class tourer deliveries started in September 2012, and A-class vehicles would be available in 2013. However, manufacturers want to make sure that these vehicles are not positioned as 'cheap' luxury vehicles in India.
In BMW India's product portfolio, Mini is also a brand which is positioned as affordable luxury. Mini has been able to sell 300 units in India and 2 million global units, which is indicative of the above mentioned trend. As per Andreas Schaff, President of BMW Group India, the initial focus is to establish the brand in the country, and lifting sales volumes would be an objective at a later stage.
Luxury cars only account for 1 per cent of the total car sales, which stands at 2.4 million units during the year 2011. as per ET. In comparison, the figure stands at 12 per cent for Germany, 4 per cent for China and 7 per cent for US. Not only does the entry of Rs. 25-30 lakh vehicles bring first-time buyers into the forefront, but it also allows the customers to get a compact car with abundant safety and comfort features, something which is currently missing in the market. As an example, the B-Class tourer gets seven air bags, paddle-shift gears fitted with the steering wheel and the SLS AMG's transmission, at a price of Rs. 25 lakhs.
