Mercedes-Benz, BMW fight it out for top slot

After a gap of five months, Mercedes-Benz India Pvt. Ltd overtook BMW India Pvt. Ltd in July, selling 297 units against BMW’s 261, according to data released by the Society of Indian Automobile Manufacturers (Siam).

Although a month’s numbers are not quite indicative of a trend reversal, it’s a breather for the Indian arm of German car maker Daimler AG, which had been losing ground to its younger rival BMW India in the Indian market.

Mercedes-Benz and BMW are the market leaders in the foreign luxury car segment. Although the segment is small and accounts for just 2.5% of total cars sold every year in India, it has not deterred new firms from entering the market at regular intervals.

Fast lane: BMW India president Peter Kronschnabl says he expects the luxury car segment to register a 20% growth in the Indian market and that new model launches will help expand sales to 8,500-9,000 units. Ramesh Pathania / Mint

Mercedes-Benz India, which in 1994 became the first foreign car maker to enter the Indian luxury car market when it set up a plant in Chikhali-Pimpri near Pune in Maharashtra, had a headstart over Bayerische Motoren Werke AG and Audi AG, which entered in 2006 and 2007, respectively. The latest entrants are Jaguar and Land Rover, now part of Tata Motors Ltd.

However, both BMW and Audi, as well as others such as Volvo, Porsche, Rolls-Royce and Bentley, have been present in the Indian market through direct imports.

Despite the fewer number of cars sold in July, BMW continues to lead with overall numbers. In the seven months to July, it sold 2,008 cars against Mercedes’ 1,712. In 2008, Mercedes sold 3,625 units, while BMW sold 2,908.

In 2008, its first full year of operations, Audi, the third German car maker after Mercedes and BMW to enter India, sold 1,050 cars. Sales numbers for Jaguar and Land Rover are unavailable since they were launched in India on 28 July.

Wilfred Aulbur, managing director and chief executive officer at Mercedes-Benz India, said, “The sales are in line with our expectations. I would not like to comment on a single month’s performance.”

In 2008, despite the global economic slowdown, sales of luxury cars — defined as cars with a minimum ticket price of Rs25 lakh — continued to grow in India with an estimated 7,000-7,500 units sold, or 70% more than 2007 sales.