Luxury car sales hit the fast track

Some people will never tire of saying that a car is just a mode of transport. But scores of people in India are expressing themselves by splurging on expensive cars. The country overtook Japan this year as the most fertile breeding ground of billionaires in Asia.

While specific figures are hard to get "" the number of imported cars segmented according to their class is difficult to track "" ebullient estimates say the size of the luxury car market in India can be as big as 3,000 a year and growing at 30 per cent annually.

Italy's Automobili Lamborghini started selling its super luxury cars through Exclusive Motors situated in New Delhi's Ashok Hotel in the middle of 2006.

According to Rahul Grover, deputy general manager, Exclusive Motors, about a dozen cars were sold by the dealership last year. An equal number arrived again this year, of which only two remain unsold.

While the number may not boggle the mind, the price tag is another story.

Gallardo, the cheapest Lamborghini in India, costs Rs 2 crore, while Murcielago costs Rs 3 crore. One can buy up to 100 Hyundai Santros for the same amount.

Stephan Winkelmann, chief executive officer of Lamborghini, told 'Business Standard', "We have a dealer in Delhi and are thinking about (appointing) a dealer in Mumbai."

The manufacturers of Rolls-Royce, Porsche, Lamborghini, Aston Martin, Ferrari & Maserati, Jaguar, Mercedes-Benz, Maybach and BMW are setting upbeat sales targets for themselves.

The cheapest cars manufactured by these companies cost Rs 20-25 lakh (Mercedes C-Class). However, they also make cars that cost Rs 70 lakh (S-Class) to Rs 5 crore (Maybach).

Mercedes-Benz, which produces cars in the country, is expanding its operations to meet the rise in demand. The company sold 1,020 units in the first five months of this year, including 125 units of the S-Class. It hopes to surpass its last year's sales of 2,100 cars.

Porsche, which entered India in 2004, has sold 200 sports cars so far and aims to sell 150 in the next 12 months. Sandeep Gupta, Porsche India's marketing specialist, said, "With our Mumbai centre opening up soon, we are aiming to sell 150 cars in the next one year." The hottest selling Porsche in India is the sports utility vehicle, Cayenne, which has a waiting list.

Sharad Kachalia, director, marketing, Navnit Motors, which owns the dealership for Rolls-Royce and Land Rover, said, "Rolls-Royce, UK, has earmarked only 10 units for India, which is much below the actual demand." Land Rover has revised its target to 50 units for 2007 from 29 sold in 2006.

BMW, whose first locally assembled cars have just rolled out from the Chennai plant, said there was an unexpected surge in the demand for its 3-Series (the cheapest car in its India stable).

Peter Kronschnabl, president of BMW India, said, "Our sales have exceeded our projections in just a month (119 units sold in May). This has forced the company to revise this year's target to 1,200 (from 1,000)."

The demand may increase due to the untapped potential. According to Dilip Chenoy, director-general of Society of Indian Automobile Manufacturers, "India has more billionaires than China, but the market for super luxury cars in that country is 10 times higher."