"THESE BRANDS ARE TARGETING WHAT I CALL THE YUMMY' SEGMENT, OR THOSE WHO ARE YOUNG AND UPWARDLY MOBILE," SAYS OUR CEO , MR ABHAY GUPTA!
NEW DELHI : The mainline car market may be struggling, but luxury makers are riding the wave of the affluent Indian, who wants to announce his wealth and success. undaunted by the slowing economy and rising fuel prices, the luxury market has seen healthy demand in the last financial year, encouraging companies to work on new launch plans and further expansion.
While the overall car market, pulled down by mainline players like Hyundai, Maruti3SE -0.58 k, General Motors and Mahindra, slips into the red for the second year in a row, luxury makers like Mercedes Benz and Audi have returned with their best-ever figures.
Mercedes, Which is on a revival path in India after lasing its tap position, saw a 47% surge in volumes as sold 9,548 units in 2013-14 against 6,491 units in the previous year. For Audi, sales topped the five-figure mark for the first time since its inception (in 2007) as the German major sold 10,126 units. The growth rate though was a relatively-modest 8%.
What is fuelling this surge at a time when the overall sentiment is nervous? "These brands are targeting what I call the yummy Segment, for those who are young and upwardly mobile," says Abhay Gupta, CEO of Luxury Connect, which aids international luxury brands set foot in India.
Gupta says convenient financing options and 'trading down" by the auto companies, who are lowering the threshold of car acquisition, are fuelling the surge. "So you have entry luxury brands like the BMW Xl and Mercedes ACIass."
Joe King, head of Audi in India, says the company will continue to follow the "topdown strategy' to win more customers. "In line with our top-down strategy, we will be launching the next big Audi the A3 sedan — later this year.
Globally, the Audi A3 has been agreat success and we are confident that it is the right product for the Indian market."
Mercedes plans to get models like GLA SUV, new C-Class and the CLA AMG. "We equate this interest level and penchant for owning the threepointed star with the growing aspiration level of affluent Indian customers. We have seen an upward trend in bagging customers, who are successful professionals and live a global lifestyle. This is a very positive trend and keeps us bullish about the long-term growth potential," says Eberhard Kern, MD & CEO of Mercedes India.
Wilfried Aulbur, managing partner at Roland aerger3SE -0.58 % Strategy Consultants, says "There are enough people in India who can spend money and indulge themselves even in such difficult times. It is their way of making a statement that they have arrived in life."
Publication: Economic times (View); Date: April 4, 2014.