Mercedes-Benz India on Monday launched the locally assembled V-Class luxury MPV, marking its 12th model to be produced in India at the Chakan plant near Pune. This plant has an annual production capacity of over 20,000 vehicles along with the paint shop can handle up to 40,000 units, offering flexibility for additional volumes.

While the company did not disclose the exact investment for the model, it confirmed fresh capex on tools, jigs and fixtures given the vehicle’s distinct body structure.

“We are very much focused on bringing products that resonate with Indian customers while leveraging our local manufacturing strengths,” said Santosh Iyer, Managing Director & CEO, Mercedes-Benz India.

Rs 3,000 crore India investment

Mercedes-Benz India has invested around Rs 3,000 crore in the country so far and said investments will continue alongside product expansion. Dealer partners are expected to invest about Rs 450 crore in 2026 towards network upgrades and expansion.

Priced from Rs 1.4 crore (ex-showroom), the locally assembled V-Class is “significantly more competitive” than the roughly Rs 2 crore it would have cost as a full import, according to Iyer. The company is targeting triple-digit annual sales, which it says justifies localisation.

At Rs 1.4 crore, the V class sits at similar pricing levels of the Toyota Vellfire and well below the Lexus LM that is priced above Rs 2 crore. Both Toyota and Lexus models in this segment are fully imported. Deliveries for the V-Class will begin by end-March, initially through completely built units (CBUs) at the same price before local production scales up.

Sustained momentum in the luxury car market

The launch comes amid sustained momentum in the luxury car market, with the top-end segment growing 11% last year for Mercedes Benz India. “Customers today are looking for sanctuary and comfort in their mobility experiences. The V-Class offers exactly that,” Iyer said.

The model is offered with both petrol and diesel powertrains, unlike the earlier diesel-only version. Mercedes has introduced an India-specific petrol engine paired with Airmatic suspension, along with privacy blinds and a first-class rear cabin configuration tailored to local demand.

Mercedes sees the V-Class as creating its own niche within the ultra-luxury MPV space, targeting business leaders, frequent travellers and families seeking premium chauffeur-driven mobility. While the company expects growth to continue, it does not foresee double-digit expansion next calendar year, citing the sentiment-driven nature of the luxury segment.