At a time when super luxury car makers Sweden's Agera, Germany's Gumpert and France's Buggatti have failed to excite India's billionaires, Lamborghini grew by 29 per cent to retail 22 units in 2013. The pull for the brand has spurred interest of the Italian luxury car maker and made it look closely at the market here for its latest offering - the Huracan.
Scheduled for its official debut in the second half of the year, the Huracan has already registered 1,000 bookings worldwide. Pavan Shetty, head of operations, Lamborghini India, confirms some of these have come from the well-heeled in India. Huracan, which is already one of the most sought-after models in Lamborghini's line-up, has been conceived as a replacement for the Gallardo. The car is expected to be priced upwards of Rs 3.4 crore in the country.
Interestingly, India was one of the few markets globally where Lamborghini hosted special private previews of the new model. With the launch of the new product, the brand is looking to up the ante this year in terms of overall volumes and an increased and expanded presence. The company is looking at commencing deliveries of the Huracan from September this year.
Unlike most super luxury cars makers who retail from a single showroom across the country, Lamborghini is looking at adding a third outlet in Bangalore in the second half of 2014. Shetty says, "What we have done differently from our competition is that we have dealer outlets in both Delhi and Mumbai. We are also looking at opening a third outlet in Bangalore by the second half of 2014. It will cater to southern market. It will widen our reach and also help in extending our servicing network. We offer round the clock service and our technicians can reach any destination within a day".
With their cutting edge technology, these cars need high-end service back up, too. India currently contributes about one per cent to Lamborghini's global sales (2121 units in 2013) but is a strategic market for the company in Asia. This has made the company look minutely at addressing both distribution and servicing needs of customers in the country.
Shetty says the positive aspect is that infrastructure in India is improving throwing open opportunities for customers to own luxury sports cars. "Delhi is our largest market but we are seeing a lot of interest from buyers in smaller cities like Surat, Ahmedabad, Ludhiana and Chandigarh. The culture of owning and driving sports cars is catching up not only in metros but in tier-II & II cities. These places now contribute around 20 per cent to Lamborghini's annual sales in India", he says.
Indians, admits Shetty, prefer solid assets but adds there is a strong base emerging of young customers who have travelled abroad and have aspirations to own sports cars. The age profile of Indian customers is close to the global benchmark of 25-45 years. The only difference is in other countries the customer set also includes professionals. In India it is predominantly business men who buy a Lamborghini.
There are prima-rily two sets of customers in India comprising second generation business families and a limited number of buyers who are entrepreneurs and have made it large. The average age of the India buyer is 35-40 years.
The company has limited processes to enhance ease of owning a Lamborghini car. Customers can buy and drive home a Lamborghini is just three days. The company can get any component into the country within 10-12 days, even for models which have gone out of production. Shetty informs, "We customize products and also refurbish older cars like the Miura which has exotic value and are huge draws in auctions. Since we are a small organization we are more agile and respond quickly to customer requirements".
India is not currently in Lamborghini's list of top 10 markets but hopes to make it in the pecking order shortly. The size of the super luxury sports car market (two-door, 400 PS, costs upwards of Euro 100,000 outside of duties) in India is about 100 units per annum. The US and China are its largest markets.
Taxation structure in India continues to pose a challenge for manufacturers retailing super luxury cars in India. Shetty adds, there are a lot of variables which affect sales of super luxury cars in the country, the biggest challenge being taxation. Over the last two years, price of vehicles in this segment has gone up by 30 per cent and the market has shrunk by 25 per cent indicating a direct correlation between sales and price structure.
Taxes on super luxury cars amount to as much as 172 per cent in India. In India taxes are steep when compared to other Asean economies. In the US and West Asia, for instance, the tax structure is customer-friendly, infrastructure is better, fuel is cheaper and per capita income is higher and these are the factors support sales, says Shetty.