Mercedes Benz, along with automakers like BMW and Volkswagen, has stopped exports to Russia. The company has also ceased local manufacturing in the country.
Mercedes Benz India said that while the overall luxury car market was swiftly recovering in the country, the top-end of the market, with cars costing several crores of rupees, was growing at a much faster rate, which could be an outcome of the high growth in wealth of rich Indians last year and the phenomenon of revenge spending.The company expects the sales of its top-of-the-line nameplates like GLS Maybach, S-Class, GLS and AMG to grow by 20% this year. It registered a sales growth of 80% in 2021 for these brands compared to a 43% growth in its overall sales.The largest-selling luxury car maker in India sold a car costing more than Rs 1 crore every four hours on average in 2021, as per data shared by the company.Overall, Mercedes Benz India was sitting on an orderbook of over 3,000 vehicles, which amounts to a business of over a quarter-billion dollars by ET’s estimates.To further push upwards the sales in the high-end category, the company launched the new-generation Mercedes-Maybach S-Class in India on Thursday.Launched in two variants, the company will assemble the S580 variant, with a starting price tag of Rs 2.5 crore, at its plant in Pune. “We expect significant enough volume to go for localisation,” Martin Schwenk, the managing director of Mercedes Benz India told ET.The more-expensive S680 variant, costing upwards of Rs 3.2 crore, will be imported into the country. The company has already sold out its allocation for this variant till 2023. Meanwhile, the locally produced S580 variant is sold out till August this year. The company has also sold out other high-end models like GLS, GLS Maybach and G-Wagon too for the year.Speaking about the Russian invasion of Ukraine, Schwenk said that it was a “serious violation of European peace” and “really unacceptable.”He said that it was early to assess the economic impact of the crisis, but it was a possibility that the commodity price inflation will worsen. Rising prices of commodities like metals and crude over the last year have squeezed the margins of manufacturing companies across the world, including automakers. Brent crude crossed the $110-a-barrel mark on Wednesday.Mercedes Benz, along with automakers like BMW and Volkswagen, has stopped exports to Russia. The company has also ceased local manufacturing in the country.The decision could mean that other markets may get a higher allocation of parts and semiconductor chips. However, Schwenk said that no conversations were held within the company on this yet.
A shortage of parts over the last year has resulted in automakers across the globe being unable to meet market demand. The company had told ET in an earlier interview that if not for the parts shortage, sales in India would exceed the pre-pandemic peak of 2018.
Keyword: High-end luxury car sales outpace the wider premium car market: Mercedes Benz India