# Mass Market Automakers Challenge Luxury Segment

> Mercedes and BMW adopt different strategies to capture India's luxury market growth.
- Title: Mass Market Automakers Challenge Luxury Segment | Shortify
- Summary: 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…
- Keywords: india, luxury car market, mercedes, bmw, premium models, electric vehicles, Mass, Market, Automakers, Challenge, Luxury, Segment
- Source: The Economic Times — https://economictimes.indiatimes.com/industry/auto/auto-news/mass-market-automakers-gaining-ground-in-the-premium-segment-mercedes-bmw-work-out-different-strategies-to-drive-growth/articleshow/134509179.cms
- Author: Lijee Philip
- Published: 2026-09-27T00:00:00+00:00
- Read time: 1 min
- Topics: india, luxury car market, mercedes, bmw, premium models, electric vehicles
## 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.
## Key takeaway

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.