Industry experts believe that cumulative volume in 2022 will not reach the peak levels of the 2018 calendar year, when it sold 40,340 units.
According to Ravi Bhatia, President of JATO Dynamics, “The segment will not reach 40,000 this calendar year. Sales of luxury cars in the domestic market are expected to be around 35,000 units by 2022.”
Echoing a similar stance, Puneet Gupta, director of S&P Global Mobility said, “For the calendar year 2022, total sales in this segment are not expected to peak at 40,000 units. Our estimates are that they are expected to be around 32,000 units. ”
While the pandemic did not have a huge impact on demand for luxury car sales in India, the challenge for these OEMs is longer wait times due to semiconductor shortages, he said.
This calendar year will be our best year ever, as we expect more than 15,000 units sold by 2022Martin Schwenk, MD and CEO, Mercedes-Benz India
Martin Schwenk, MD and CEO, Mercedes-Benz India, said: “This calendar year will be our best year ever as we expect more than 15,000 units sold in 2022. Overall, the recovery in the luxury segment is very positive for this year.”
India’s largest luxury car manufacturer reported its best sales performance with 15,538 units five years ago.
Sale of luxury cars in India
Source: JATO Dynamics
Vikram Pahwa, President and CEO of BMW Group India, said the company was at record levels until August and that calendar year 2022 is expected to be the best year ever. The company is confident that it will exceed 2018’s top sales with 10,409 units.
“We have seen a rapid and robust return in demand since the pandemic settled in the country. Engagement and research level have increased, and this is just the pre-festive question. The festive season is upon us and we expect it to get even stronger,” said Pahwa.
Speaking about the overall luxury car market in India, he said: “Demand is definitely coming back to pre-Covid levels and if this continues we could be looking at record levels in the industry in the coming years.”
Demand is definitely coming back to pre-Covid levels and if this continues we could be looking at record levels in the industry in the coming yearsVikram Pahwa, President and CEO, BMW Group India
Audi India witnessed a 49% growth in H1 2022 compared to the same period of 2021. “We expect this upward trend to continue in the second half as well and expect to close this year with double-digit growth.” says Balbir Singh Dhillon, head. said Audi India.
However, the company’s sales volumes in the first eight months of the year at 2,341 units are well below the high of 6,463 units in calendar year 2018.
According to Dhillon, aggregate demand has grown steadily in recent months and is expected to continue into the coming holiday season. This segment has not been unaffected by the dangers of COVID-19. Like the rest of the auto industry, the luxury car segment is dealing with the ongoing shortage of semiconductors, along with other supply chain constraints.
He added: “After the pandemic, there has been an increase in purchasing power and the YOLO (you only live once) culture driving demand in this segment. The ongoing and upcoming holidays will further support growth.”
Like the rest of the auto industry, the luxury car segment is dealing with the ongoing shortage of semiconductors, along with other supply chain constraints.Balbir Singh Dhillon, Head, Audi India
Jaguar Land Rover (JLR), owned by Tata Motors, recently said its sales worldwide are still being limited by the chip shortage and the impact of Covid lockdowns in China.
The Indian subsidiary of Swedish carmaker Volvo Cars is expected to sell nearly 2,000 units in the current calendar year, which represents a growth compared to the past two years. But exceeding the peak sales of more than 2,500 units is not expected in 2022.
Currently, luxury car volumes account for less than 2% of total passenger car sales per year. According to the ‘World Inequality Report 2022’, India is one of the most unequal countries in the world, with increasing poverty and a ‘prosperous elite’.
The average national income of the Indian adult population is INR 2.04 lakh. Here, the bottom 50% earn INR 53,610 while the top 10% earn INR 11.66 lakh, more than 20 times more. The report highlights that the top 10% and top 1% in India hold 57% and 22% of total national income, respectively, while the bottom 50% share has fallen to 13%.
Top 10 Selling Luxury Car Models in 2022 (Jan-Aug)
Source: JATO Dynamics
The super luxury car segment, which clocks minimal volumes, is also positive about the outlook for the current calendar year. Sales volumes in this category are low, but are considered healthy considering that the price range of its cars on the road starts at INR 4 crore, and these are fully imported, levying heavy taxes in the country.
Naveen Soni, President of Lexus India, said: “The luxury car market is on a V-shaped recovery path with strong luxury consumer demand mainly attributed to change in consumer behavior, more successful start-ups, young affluent consumers, leading local production to a higher sense of value and an increase in the number of HNIs.”
“While demand is strong and vibrant, we estimate this to be the best ever for the luxury car segment, but there are challenges due to the semiconductor shortage and the dynamic geopolitical situation around the world. It’s early to say whether this growth can be sustained,” he said.
Last month, Sharad Agarwal, Head, Lamborghini India told ETAuto: “We are positive about the growth momentum for this year. However, the segment is not growing to its market potential and the size of the segment does not fully reflect the kind of potential we have in the Indian market. .”
In the future, it would be worth noting when the luxury car segment overcomes all odds of exceeding its peak sales in the domestic market.