Last year, one in every four cars sold by Mercedes-Benz, the country’s largest luxury car maker, was priced above Rs 1.5 crore. In 2023, this was one in five cars.
Further highlighting the growing trend of premiumisation within the luxury car segment, some of these cars have been sold out for the next three quarters and bookings aren’t expected to open until Diwali.
EQS, the top-of-the-line electric SUV, Maybach, and electric G-Class, each of which is priced above Rs 1.5 crore, has been fully booked till September end.
“From around Rs 60-65 lakh five years back, the average selling price for Mercedes-Benz India now stands at Rs 95 lakh. Luxury is a sentiment-driven purchase,” Santosh Iyer, managing director and CEO, Mercedes-Benz India said in an interaction with FE.
The top-end segment (Rs 1.5 crore and above) of the company grew by 30%, whereas its core segment (Rs 80 lakh to Rs 1.5 crore) grew by 22%. On Thursday, Mercedes launched new G580 with EQ technology at Rs 3 crore and EQS SUV 450 priced at Rs 1.28 crore.
“What’s remarkable is that the demand from smaller cities and from towns, where we never sold a Mercedes before, is for the core and the top-end segment. It’s not for the entry models. This is a very good insight for us,” Iyer added.
There were 90 towns and cities, last year, including Parbhani, Korba, Thiruvanamalai, where the brand never had an owner before.
Notably, the surge in demand is not uniform across the segments. Mercedes’ entry segment, comprising the A-Class Limousine priced at Rs 46 lakh, was flat last year. Customers from outside of the Tier 1, Tier 2, Tier 3 cities preferred going for the more expensive models than entry level models.
“In our customer segment, (the heightened buying power) has got a lot to do with land transactions. Real estate prices have gone up. And yes, there are rich farmers also,” Iyer added.
During 2024, Mercedes clocked 12% growth in volumes in India at 19,565 units over 2023, powered by 14 launches. While the company declined to provide volume growth guidance for 2025, it has committed to launching 8 new models this year. “We moved into the new year with an order bank of 2,000 cars,” Iyer added.
At least 20 more touch points will be added in 2025 to the company tally of 125 in more than 50 cities, making it the largest network among the luxury car brands in India.
“Jammu, Patna, Kanpur, Agra, Raipur will see the opening of touch points. We are revamping our network for which there will be a spend of Rs 450 crore, which is being invested by our dealer partners,” Iyer added.
