A top BMW official predicted that over the next 10 years, the luxury car segment in India, which currently accounts for only around 1% of the country’s rapidly growing passenger vehicle industry, will undergo a major transformation due to the rising wealth and spending power of young Indians.
After Mercedes Benz India, BMW is the second-largest luxury car manufacturer. Between January and September, the Bavarian carmaker sold a record 9,580 units, an increase of 10% from the previous high set a year earlier. The highest-ever monthly sales of 1,439 units were achieved in September thanks to increased supplies and persistent demand, which were boosted by the introduction of new items across segments.
Likewise, Mercedes Benz also achieved its all-time best sales in India for January-September at 12,768 units, up 11% from a year earlier. Audi India also recorded an 88% increase in sales over the period, selling 5,530 vehicles.
Notably, luxury automakers are experiencing a robust increase in demand, particularly in the premium sport utility vehicle segment, as passenger vehicle sales in India continue to rise rapidly. Vikram Pahwa, president, of BMW Group India, said in a recent interview:
“The luxury segment is very small and didn’t grow for many years. There is more growth happening upwards right now (to high-end models), but with our strategy of bringing more customers at the entry level, we are talking about long-term sustainable growth. The first task in our strategy is to make sure that we get enough people into the premium segment, and that’s exactly what we’re doing with the X1 SUV. Once people enter the segment, the top-end and the mid-segment also grow because people go further up the price ladder. As that happens, we believe it will be driven primarily by people within the segment migrating to top-end vehicles, than from the outside.”
According to Pahwa, as India’s young population develops and impacts purchasing trends, luxury car sales are projected to increase significantly. He added:
“Indian society is changing. Our youth has different consumption habits and will come into the consumption class in the next 10 years. I think that will drive a huge shift. 57% of our population is below 34 years old. Normally, one’s consumption pattern starts picking up after 35 and multiplies across the world. So, we have this huge population that is yet to come into this bracket. It will grow the economy, secondly, growth in road infrastructure will also trigger people to live outside city centers, and in suburbs instead, which will trigger demand for better cars. Finally, our own strategy of providing products that match Indian values, like the long-wheelbase 3 series, will enable the adoption of premium cars much better.”
Earlier this year India surpassed Japan to take third place globally in terms of automobile sales. With skyrocketing figures, the neighboring country’s vehicle sales continue to break records. September witnessed the best-ever passenger vehicle sales with 3,63,733 units sold in the Indian market. This one month’s figure is 3.5 times higher than the cumulative sales of all PAMA-member companies during the entire fiscal year 2022-23 in Pakistan.
A computer animation professional with over 23 years of industry experience having served in leading organizations, TV channels & production facilities in Pakistan. An avid car enthusiast and petrolhead with an affection to deliver quality content to help shape opinions. Formerly written for PakWheels as well as major publications including Dawn. Founder of CarSpiritPK.com