Luxury Carmakers See Accelerated Demand For Premium-End Models In India
Luxury carmakers -- Mercedes-Benz, Audi, and BMW, are witnessing accelerated demand for their models at the premium-end in India, leading to longer waiting periods amid supply constraints, according to top officials of the companies.
They are witnessing higher growth in the premium-end as compared to the volume segment of their respective portfolios.
"In the last couple of months, I would say the trend started from last year, the demand on the C and D segment, which is cars above Rs 70-75 lakh, the growth in that segment is even more than the volume-segment growth for us," Audi India Head Balbir Singh Dhillon told PTI.
He further said, "People at large, who are capable of buying these sets of cars (industrialists, sports personalities and Bollywood celebrities) are really coming forward and spending on buying the luxury goods and the demand is really really good."
Citing the example of Audi's electric car e-Tron, Dhillon said, "We are selling these cars in the Rs 1 crore-plus category. They are sold out even before they arrive in India.
"Partly, it's also because there are definitely supply constraints but still I will say whatever we are getting there it's all pre-sold. So there is a very positive demand on whether it is an e-Tron or Q8 (SUV)."
The waiting periods for these cars have gone up, he said adding, "what was on waiting for a month to two months is now going to up to four to six months".
Expressing similar views, Mercedes-Benz India Managing Director & CEO Martin Schwenk said, "Unfortunately for some of the cars it will take months for our customers to receive, specifically our GLS and GLE (SUVs), where there is not only supply-chain constraints, but the demand-side globally is so high that we have to prioritize and make sure that we can actually deliver it over the year."
In the first quarter of 2022, the company had a total order bank of over 4,000 units across the portfolio, he said.
Mercedes-Benz India had sold over 2,000 units of top-end vehicles priced above Rs 1 crore in 2021. These cars, including S-Class Maybach, GLS Maybach, top-end AMGs, S-Class, and GLS SUV, account for around 30 per cent of the company's total annual sales. It expects the high-end segment volume to increase by 20 per cent in 2022.
Another luxury carmaker BMW is also witnessing a similar trend of its premium vehicles witnessing faster growth.
"We are very strong with the SAV (sports activity vehicles) -- X3, X4, and X7 models. We are registering 40 per cent growth in that segment. They are now more than 50 per cent of our portfolio," BMW Group India President Vikram Pawah said.
BMW India's SAV segment, with prices starting above Rs 61 lakh, had clocked sales of 1,345 units in the first quarter, a growth of around 40 per cent.
The company has an overall bookings of 2,500 units, including its compact luxury car MINI with a waiting period of around 3 months.
In the January-March period, the BMW group had posted one of its best quarters in India with a 25.3 per cent jump in four-wheeler sales at 2,815 units.
The luxury car makers are hoping that supply constraints due to the ongoing semiconductor shortages, unavailability of shipping freights and impact of the war in Ukraine, are likely to ease towards the later part of the year.