Luxury car buyers lapped purchases ahead of an impending price hike, resulting in a brisk year on sales for most manufacturers in the year ended March, shows data released by some companies.
Finance Minister Arun Jaitley had announced in the Union Budget an increase in Customs duty on CKD (completely knocked down) import of motor vehicles, motor cars and motorcycles from 10 per cent to 15 per cent. The government also raised customs duty on specified parts and accessories from 7.5 per cent to 15 per cent. Luxury car manufacturers, who have so far refrained from passing on the hike to customers, are likely to do so shortly. Most of them are expected to raise prices later this month.
A delay in the price hike boded well for companies. While volumes at Mercedes-Benz India, market leader in the segment, jumped 22.5 per cent to 16,236 units in 2017-18 over the year-ago period, Audi India, the third-largest in the segment, too, reported a 7 per cent increase. The company sold 7,647 units against 7,101 units a year ago, it said.
BMW India, after years of decline sold 9,800 units, up 25 per cent over last year in calendar year 2017. Albeit on a small base, volumes at Jaguar Land Rover India increased 49 per cent to 3,954 units in calendar 2017 over the last year.
The year 2018 began on a positive note for the brand, said Roland Folger, managing director and chief executive officer of Mercedes-Benz India. In the quarter ended March, Mercedes sold a record 4,556 units, as against 3,650 units in the year-ago period, up 24.8 per cent. Folger attributed the strong quarterly sales performance to customers who advanced the purchase due to the impending price-correction.
Folger said the company was excited with the strong performance of its mainstay models, including the C-, E-, S-Class and the SUVs. The success of the Long Wheelbase E-Class underlines the aptness of our decision to launch the car in India. We will continue with our product offensive and introduce a host of new products across segments and body shapes.
Luxury car sales- those which cost more than Rs 2 million in India - had slowed over the past three years, after a ban on the sale of diesel cars in Delhi in 2015 and the demonetisation. Cumulative sales of luxury cars contracted 4.2 per cent from a year earlier to 33,279 units, according to market researcher IHS Markit.