Luxury car makers pick up speed in India

Feb 01, 2010

Hyderabad, Jan. 31: It is the small car which makes the big headlines in India, but action is also heating up at the other end of the street. Luxury car brands are lining up with new models and expanded reach to tap Indian market.

Daimler Benz, which owns Mercedes, has laun-ched seven new models in the past month. Arch rival BMW has also launched three new models so far in 2010. Significantly, the company is planning to expand its dealership network in India. The company is reportedly planning to add 10 new dealerships, in addition to its existing 16, in smaller cities such as Lucknow and Coimbatore. Other high end car brands — Audi and Jaguar Land Rover — are also looking at scaling up their presence substantially. JLR, which is now owned by Tata Motors had only one dealership in all of India till last year. In early January, the company announced that it had issu-ed letters of intent for a dea-lership in Delhi, Hyderabad and Ludhiana. Audi too, is looking at covering 10 more cities in 2010. Despite the activity however, luxury cars form a very small slice of the Indian car bazaar. Close to 1.8 million cars were sold in India in 2009. The share of luxury luxury brands was less than one per cent there. However, growth in this market is expected to be strong. Audi sold 1,658 cars in 2009 in India — up 58 per cent over the year before — and it expects to sell 2,500 units in 2010. After witnessing a drop in sales in 2009, Mercedes is hoping for double digit growth too. Companies are also investing in manufacturing. “We are increasing our engagement in India with Indian suppliers. We are getting additional support in engineering and logistics that we are building up to make sure that we can leverage the advantages of India more aggressively. We expect 2010 to be a very good year,” said Mercedes-Benz India’s CEO and MD, Wilfried Aulbur at a recent launch. Mercedes has invested Rs 250 crore in putting up its assembly plant in Pune, which can go up to 12,000 vehicles per annum.

Amrit Raj Jha

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