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NEW DELHI : Mercedes Benz India, the largest luxury carmaker in the country with more than 45% market share, expects growth to be increasingly driven by top-end models. Inflationary pressures and customer preference for feature-rich vehicles have moved its sales significantly in favour of cars with a price tag of more than 1 crore, Martin Schwenk, managing director and chief executive, Mercedes Benz India, said in an interview. The company also announced the launch of the new C-Class, its second-largest selling sedan, at a starting price of 55 lakh. Its most affordable offering is the A-class sedan. Edited excerpts:


From 2018, the percentage of your sales in the 1 crore and above segment has gone up significantly, at the cost of the entry-level segment ( 40 lakh- 50 lakh), which fell from 40% in 2018 to 24% in 2022. What led to this shift?

There are multiple factors at play. Across all of our range, we are now following a strategy in which we say a luxury car has not only to offer the latest in technology and design but also needs to be equipped well. So we don’t offer what you consider ‘entry-level models’. In every range, we have fully equipped and loaded vehicles because that is what our customers expect. We also have a clear trend towards higher-end vehicles that our customers are looking for, so we make adjustments in our portfolio across price ranges to provide more features. On the one hand, that contributes, to some extent, to the price positioning following suit cross the portfolio, apart from inflationary pressures moving prices up. On the other hand, we see customers are preferring our top-end models, where the share of cars over 1 crore has gone up from 12% four years ago to almost 30% now. So, we have very strong growth. We believe this trend will continue to some extent. Whether the segment of 40 lakh- 50 lakh will be smaller or only the percentage in our portfolio will be lower, which I think is more likely, is something that is still developing. However, we expect growth in the segment above 50 lakh.

You’ve just announced the price for the latest C-class, which opened to record bookings. With sedans still forming about half of the sales for Mercedes Benz India, will this segment continue to be a key focus area alongside SUVs?

Almost 50% of the sales in our portfolio is from sedans. In that sense, the C-Class is extremely important to us because it is our second-strongest sedan model, after the E-Class. We know that a lot of luxury car customers are looking for sedans that are comfortable to drive and be driven, which are now also giving not only a feeling of elegance, but also sportiness. The new C-Class has a lot of sporty elements on the outside which makes it attractive and we have a lot of latest tech in the car. We call it the baby S-Class, because the features and positioning supports an ambition towards an S-Class, our most premium sedan offering. We have opened bookings to very strong customer feedback and have more than 1,000 bookings already.

Do you see signs of improvement in the supply chain for semiconductors and easing of logistics snarls caused by disruptions in the shipping of containers? How is that reflecting on waiting periods for your models?

At this stage, I don’t really see an improvement on either front. Chip constraints have impacted production globally and will continue to affect our brand for some months. I don’t see us having a significantly changed position before the end of the year. Similarly...delays in terms of container shipments...doesn’t appear to be easing anytime soon. I expect this, too, to continue into the next year, which of course is a problem. At present, every car we build has a customer waiting. So, delays in arriving shipments mean customers are not likely to get the cars as scheduled. We are trying to mitigate this as much as possible.

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