After being insulated for much of the last year, the luxury car segment in India has for the first time started to feel the heat of the economic slowdown.
Market leader BMW has projected a sales growth of only 10-15% this year with an outside chance of 20% if the demand improves dramatically in the second half of the year. This would be the German firm’s most conservative year since it set shop in 2007 and reflects that even the super rich are impacted by the gloom in the economy.
“For the first time our dealers have to chase customers and it is a very new thing for them,” said Andreas Schaaf, president, BMW India. “I don’t think it is any different for the other players.”Mercedes Benz said the days of the over 50% growth rate are over and the next three months could be one of the toughest for premium car manufacturers.
“We do not give out sales projections but growth would be between 10% and 20% this year,” said Debashish Mitra, director sales and marketing, Mercedes Benz India. “It is not a question of affordability or interest rates for our customers but more an issue of sentiment. With the gloom all around, nobody wants to buy cars and the increased prices due to higher excise duties does not help either.”
Volkswagen group firm Audi is relatively better placed as it is banking on its compact sports utility vehicle Q3 to bring in new customers to its fold.
The firm is aiming to sell 8,000 cars this year, which would give it a healthy 45% growth over the last year. Even then it would be a climb down from the over 80% growth it had logged in the last 2 years.