From The Economic Times · Lijee Philip · · 1m 20s
Mass Market Automakers Challenge Luxury Segment
Mercedes and BMW adopt different strategies to capture India's luxury market growth.
In brief
Mercedes and BMW adopt different strategies to capture India's luxury market growth. India's luxury car sales remain at 1% of passenger vehicles as mass-market brands like Toyota and BYD enter premium segment with higher-priced models. Originally reported by The Economic Times.
India's luxury car sales stuck at 1% of passenger vehicles
India's luxury car sales volume remains stuck at around 1% of the passenger vehicle market as affluent buyers look beyond traditional marquee brands.
Mass-market brands enter premium segment
Toyota, Kia, MG and BYD bring high-priced premium models to take away potential customers who would have chosen Mercedes-Benz, Audi or BMW.
Legacy luxury brands lose market share
Data shows legacy luxury automakers' market share fell to 0.98% in 2026 from 1.1% in 2025, while premium models from mainstream brands grew to 0.14%.
Mercedes targets value growth
Mercedes-Benz India increased average selling price to about ₹1 crore from ₹60 lakh over the past couple of years, with top-end portfolio growing 20% in first half of 2026.
BMW focuses on electric vehicles
BMW India's electric vehicles now account for 26% of sales, up from 8% two years ago, with 40% of customers upgrading from non-luxury cars.
Different strategies explain growth
Ravi Bhatia of Jato Dynamics says luxury can grow without widening ownership base, with higher spending, brand changes and first-time buyers driving growth.
What it means
India's luxury car sales remain at 1% of passenger vehicles as mass-market brands like Toyota and BYD enter premium segment with higher-priced models.
