Winkelmann said one of the peculiarities of the Indian market is that Indians in general live all over the globe.
New Delhi: A lack of adequate infrastructure and high tax rates are the biggest hurdles to the growth of super luxury car sales in India despite the country being home to the third-largest number of billionaires, said Global CEO & chairman, Automobili Lamborghini, Stephan Winkelmann.
“It’s a mix. But I think the biggest challenge is the infrastructure because we are in other markets where we have (high) taxation (but) where the volumes are higher,” said Winkelmann.
To be sure, India was one of the fastest-growing markets for the Italian car maker in CY2022. Lamborghini – which sells the Urus, Aventador and Huracan priced from ₹3-9 crore – increased sales by a third to 92 vehicles in the country last year. But contribution to global sales remains low at about 1%.
Lamborghini expects to cross the three-digit mark for the first time here in the ongoing calendar year.
Currently, India levies a GST rate of 28% on automobiles, with additional cess ranging between 1% and 22%, depending on the type of vehicle. Fully imported cars attract customs duty of 60-100% based on the size of the engine and cost, insurance, and freight (CIF) being close to $40,000.
Winkelmann said one of the peculiarities of the Indian market is that Indians in general live all over the globe.
“So, we have a lot of Indian customers in Europe, especially in the United Kingdom. We have (Indian customers in) the United States and in Southeast Asia. So, let’s say, the community is even stronger than the market. So, it might also be that we have (Indian) customers, whose residences may not be in India, but they are driving Lamborghini cars,” he said.
‘Lamborghini Working on Strengthening Value Chain’
Lamborghini closed last year with record sales of 9,352 units. The company is set to introduce the new Aventador towards the end of this month, pre-orders for which already run into three years.
Winkelmann said despite high inflation and recessionary trends globally, the company has not seen any impact on demand so far. “The point is that we have no signs so far of markets which are weakening, we have markets which are more on and off through the year. Especially, the Chinese market. The rest of the world is very solid so far.”
The company, though, is working on strengthening its value chain to shield operations from disruptions in the altered geopolitical environment. “When we speak about the supply chain, it is clear that (there is) a new geopolitical situation. We are now stepping out both in terms of sales and in terms of supply chain,” he said.
For critical sourcing points, microchips or other things which are very important for building the car, Lamborghini will continue to leverage synergies with the Volkswagen Group. “The VW group is sourcing huge quantities. So, this is helping us. Synergy looks good. And on the other hand, for specific Lamborghini sourcing we are looking closer for suppliers… we are extending our range because we have in front of us a completely different type of time. For sure, India is part of our sourcing process,” he said.
Separately, Winkelmann said Lamborghini too is moving towards cleaner vehicles, like most global peers. While the all-new EV, a fourth brand in the portfolio, is likely to be launched by the end of the decade, Automobili Lamborghini is moving towards cleaner hybrid vehicles in 2023 and will be investing 1.5 billion Euros over the next four years towards this endeavour.
Keyword: India's lack of infra limiting super luxury car market growth: Lamborghini CEO Stephan Winkelmann