Why Mercedes-Benz India wants to be a notch above the rest in the luxury car segment
Mercedes-Benz has captured the Indian mind since the late 90s and has been a market favourite since. So what made this German carmaker to click in this price-sensitive market? Here’s its story.
Mercedes-Benz has been India’s largest selling luxury carmaker for five consecutive years now, with the gap between its nearest rival being more than 4,000 units. The company used a three-pronged strategy with a focus on products, dealership experience, and access to world-class service standards.
The company believes that when people upgrade to the world of luxury cars, they expect distinct features from the brand. While volumes took a 12.7 percent hit this year, the situation has been very upbeat. In fact, while gold and silver retailers saw sales drop anywhere between 20 and 50 percent on the auspicious day of Dhanteras in 2019, Mercedes smashed records by delivering 250 cars on a single day in the Delhi-NCR.
However, the luxury car market in India is still in a very nascent stage, comprising less than two percent of the overall passenger vehicle sales in the country. In comparison, in markets like China and the United States, luxury car sales account for 13 and 10 percent of the total sales.
The makeover
The German carmaker believed in going India centric, by focussing on the aspirations of Indian consumers, and used a series of strategic initiatives. The company began to offer market-specific cars and product variants. Its attempt to strike a chord with the Indian consumer met its first litmus test with the long-wheelbase E-Class.
The company understands that Indian luxury car consumers want to drive on a weekend, but be driven by a chauffeur on a weekday.India is the only country in the world to get the right-hand drive, long-wheelbase E-Class, a perfect fit for the country’s unique needs. To offer a competitive price tag to the car, the company beefed up its Pune-based manufacturing plant – the largest installed production capacity for any luxury carmaker in India
Mercedes considers its Pune facility as the backbone of its success story in India, and to date, it has invested Rs 2,200 crore in it.
Speaking to AutoStory, Santosh Iyer, Vice President of Sales and Marketing at Mercedes-Benz India, said, “Mercedes focussed on what the Indian customer needed. Our strategy in India has been to come up with products that are fully equipped for a true luxury experience. We started our revival with all new products, first with the A-Class in 2013. We have also expanded our reach and revamped all our existing dealerships.”
At present, Mercedes has the largest network spread among any luxury carmaker in India, with 97 outlets in 48 Indian cities, which will be increased to 100 this year.
It has also set up exclusive AMG performance centres in six cities including New Delhi, Mumbai, Hyderabad, Kochi, and Pune to cater to car enthusiasts.
Mercedes also understands that having a great product portfolio is just a job half done. The German carmaker also started a training centre in Pune in August 2016, which trains the dealership staff, as well as the service team.
According to internal research by Mercedes-Benz India, customers are ready to buy luxury cars but have a fear of maintenance and spare part prices. “We came out with service packages, priced lowest in the industry for a hassle-free ownership experience,” Santosh added.
Indian consumers are ready to pay if they get the best product, and with access to easy service, the love for the iconic three-pointed star has only grown.
Sustainability plans
Daimler, Mercedes’ parent company, understands that the future of the group lies in carbon dioxide neutral mobility, as well as consistent digitisation. Last year, the group increased its investment from 9.1 billion Euros globally in 2018 to 9.7 billion Euros in 2019.
Mercedes-Benz India’s mantra is ‘Restless for Tomorrow,’ and with that, it has been focussing on innovation and sustainable luxury mobility. Walking down this path, Mercedes launched the EQ brand in India in January 2020. Its electric offensive will begin with the launch of the first model, the EQC, in April 2020, and will add more products and services in the range.
The Mercedes EQC Edition 1886 showcased in India in January 2020, gets an 80 kWh battery which juices up two electric motors, producing a combined 300 kW of power and 760 Nm of torque.
This all-wheel-drive electric SUV can sprint from standstill to 100 kmph in 5.1 seconds and has an electronically limited top speed of 180 kmph. The EQC’s battery takes 11 hours to charge fully via a standard charger and just 40 min via a DC fast-charger.
However, the company will not be limiting its focus to just electric cars, but will also be working towards using renewables. By the end of March 2020, the company says about 45 percent of Mercedes-Benz India’s requirements will come from renewable resources. It is installing over 4,000 solar panels which will be able to produce around 1.6 MW per year energy and reduce 2,600 tons of carbon dioxide annually.
Growth ahead
Mercedes believes that it is well ahead of its competition and has the potential to steer ahead of the market. Today, every second luxury car in India is a Mercedes, and currently, it wants to be the driving force behind the growing luxury car market in the country.
“As a leader in the luxury car market for five years, we want competitors to grow along with us. With our mantra ‘Restless for Tomorrow,’ we want to reignite the passion and aspirations in our customers to own a luxury car,” Santosh added.
Mercedes-Benz was the only luxury brand at the Auto Expo 2020, with market sentiments not being at its best. And with a power-packed stall with models like the AMG GT 4 door coupe, new A-Class Limousine, and the new GLA, Mercedes is reiterating its aggressive, India focussed strategy.
The company will be launching more than 10 products this year, a strong product offence totally unseen in its fellow German rivals, Audi and BMW. The new A-Class Limousine and the new E-Class will be launched in June 2020. These will be followed by the new GLA in October 2020, just ahead of the peak festive rush.
(Edited by Suman Singh)
