India will lead luxury car market

[lincy]

Andreas Schaaf, the new president of BMW India , is busy understanding the dynamics of doing highend business in India to fine-tune the German auto company’s strategy to sell its luxury cars in the country’s booming market. The motoring enthusiast had some exposure to the Indian market since 2006 when he was involved in the selection of BMW dealers for India as head of market development for Asia, Pacific, Africa and Eastern Europe.

Schaaf, who has spent 14 years in the company, claims that the world’s largest luxury carmaker is on a strong footing both globally and in India. BMW, like all other carmakers, faced turbulence during the global financial meltdown. Sales dropped by 10.4% in 2009 as the world struggled to cope with the economic slowdown. Sales have since looked up this year, with demand picking up in emerging markets like India. BMW’s global sales grew by 12.5% to 9.19 lakh vehicles in the first eight months of 2010. The company now plans to sell 1.4 million vehicles by the year-end .

BMW’s Indian subsidiary, which started operations in 2007, proved to be its jewel in the crown. Sales in India grew by a robust 43% to touch 3,301 units during the first eight months of this year. Last year, the company sold more cars here than its rival Mercedes-Benz India. German carmakers — BMW, Mercedes-Benz and Audi — have, in fact, dominated the luxury car market in India.

The company has been able to cash in on the India growth story, despite being a late entrant. It has narrowed down India as a niche market globally for growth, based on its performance over the last two years. “India may not be a large market in terms of units sold, but it remains the strongest potential market globally and will outgrow all other markets in future,” says Schaaf.

However, BMW is also cautious about its product launches. The company is not planning to launch one of its most wellknown brands, the Mini small car, in near future even if Indians prefer compact cars. “Despite Mini’s quintessential brand heritage , we have not gone the Volkswagen’s way when it introduced the Beetle just to leverage on the brand. We are looking at building a critical mass. India may not be ready for a luxury small car like Mini now,” says Schaaf. The company is also yet to take a call on launching its legendary mobikes, BMW Motorrad and Husqvarna, in India.

Last year, though, BMW took its rivals by surprise, launching one of its most expensive and super-luxury handcrafted marquees, Rolls Royce cars, in India at prices ranging from . 3.5 crore to over . 6 crore depending on the customisation level. The handmade Rolls Royce has been sold out for this year and the huge interest shown by potential buyers has meant sellout of the allocations for 2011. “Our basic ideology of making cars that are both practical and contemporary for customers has worked in our favour,” claims Schaaf.

He reckons that BMW’s strength as a pioneer in technologies globally has helped its growth in the Indian market. “Our all-new 5 Series 320d efficient dynamics edition offers a fuel efficiency of over 20 km a litre, the highest in the entire BMW stable. Such improvement in technology in our new cars has made the 5 Series so popular that customers are ready to wait for over four months for delivery,” says Schaaf. To push sales in markets such as China, Russia and India, BMW is changing the business concept of premium to mobility, and making more fuel-efficient vehicles. The efficient dynamics concept will drastically reduce fuel consumption and reduce carbon dioxide emissions across its entire fleet, making them an environment-friendly brand, says Schaaf.

[shiva]

India is certainly one of the best place to increase the sales in automotive section. Its not about BMW alone, all leading manufactures in world are looking into Indian market. Recently Merc sold more than 25 cars in a single deal, so all of this shows India is the best market to increase their sales. And now Jaguar and Porsche coming into Indian market, you will see more of them very soon. Hope same will happen with motorcycle section also.

[Aron]

Man it is in Aurangabad where 150 Mercs are sold in one delivery not 25 or 30. Its not a figure that we could imagine easily. But its a deal that already took place. So it definite India is one of the best place to increase the sales of automotive manufactures. You well said about Jaguar and Porsche. And yup more brands like Citroen are coming soon i think. I think i read it somewhere.

[techmaniac]

Arman that sounds good. I mean Citroen, i love C4 and i love Sebastian Loeb .

[Aron]

Man checkout this one. Its better and bigger than Jaguars and Porsches. Bugatti is launched in India.

Quote:The world’s fastest and most expensive set of four wheels, the Bugatti Veyron, on Thursday drove into the land that made the world’s cheapest car, the Tata Nano — making India the only country where one can get a car for as low as R1 lakh and as high as R16 crore! The irony of the
situation was not lost on the Bugatti officials who were present at the launch of the Veyron Grand Sport, but the defence for bringing something as ostentatious was not without reason. India has the maximum number of billionaires outside the US, and the list is also the fastest growing. Good enough for the Veyron.

“The car is a modern statement of ultra luxury, speed and extraordinary style and India, with its growing clan of billionaires and booming businesses, is a market that is hard to ignore,” said Julius Kruta, head of tradition, Bugatti Automobiles SAS. “India is a growing market for luxury and is also the hub as the land of erstwhile Mharajas, who were true patrons of bespoke luxury.”

The Veyron, with its massive 8,000cc engine and top speed of 407 kmph, is a car that loves its exclusivity and is made only for the nouveau riche. Bugatti makes only 300 units of its models and will make only 150 of the Veyron Grand Sport. How many will actually come to India is unclear but Exclusive Motors, the official importer, said affordability was not an issue.

“India has by far the most expensive house to boot, so affordability is never an issue,” said Satya Bagla, managing director, Exclusive Motors.

“We do not have a number in mind but now the car is here and we will see how people react to it. Globally, there is a very select band of people who own a Bugatti and I am sure in India there are people who would want to be in that category.” Bugatti Veyron

I just saw it in Hindustan times.

[Duke]

Yes man they just rolled out Bugatti Veyron 16.4 Grand Sport. Price will be 16cr. I think its the starting price.

[techmaniac]

Ohh... This is even better and bigger than what we were talking. But few months back they said price will be in range of 5cr to 12 cr. Are they bringing in Completely build units ?