Luxury car sales in India continue to decline at a massive rate
As it stands, August 2020 total retail luxury sales contracted to 1,247 units, down 42.72 percent from 2,177 units in August 2019 at 930 units volume loss. Mercedes-Benz India continues to lead despite 43.71 percent decline. sales fell to 461 units, down from 819 units at volume loss of 358 units.
BMW India sales fell by 39.01 percent at 383 units, down from 628 units at volume loss of 245 units. VW Audi sales dipped below 200 units from just over 300 units. At 34.98 percent sales decline, sales is reported at 197 units, down from 303 units.
Jaguar Land Rover has always been behind the German trio in the top order. JLR sales less than halved at 55.74 percent decline. Sales is down to 108 units from 244 units at volume loss of 136 units. Volvo sales fell below a 100 units. sales is reported at 87 units, down from 156 units at 44.23 percent decline.
Porsche India sales fell to a third at 7 units, down from 21 units. A unit each of Lamborghini, Bentley, Ferrari and Rolls Royce is reported. For the latter four, sales is largely unaffected as even in the best of times, sales per month ranges from 1-6 units from select flagship dealerships in the country.
Luxury Car Market in 2020
With sales having come to standstill at the end of March 2020, sales and production activity began to amp up since May 2020. While mass market automotive segments are abuzz, luxury auto sales have decidedly contracted. To begin with, luxury car sales volumes are limited but trouble was brewing long before Covid-19 pandemic affected everything it touched.
2019 tanked for the luxury segment. It marked the biggest sales decline in over a decade. The reasons were multiple. High import tariff, economic downturn, and an anticipated wait for goods and services tax (GST) relief, which would have propelled buyers to defer purchase decisions on account of expected relief. The Indian luxury car market sizes upto less than 1.2 percent of the total car market here. Market penetration for luxury cars is way lower than that of US and china, where this number is in double digits.
While growth expectations rode on the back of implementation of BS6 mandates in April 2020, and new launches through the year, calendar year sales for 2020 will be reported at a far more steeper decline than the estimated 15 percent decline reported last year. On hindsight, the challenges posed in 2019 would appear trivial in 2020. Some recovery can be expected in September and October on account of the ongoing festive season.
Please note – The general practice of sales reports is wholesale numbers over retail numbers, which tend to be higher. In simple words, vehicles dispatched from manufacturer to dealer is what accounts for sales numbers. Now with FADA making available retail numbers, it’s possible to evaluate both, wholesale, and retail sales on a monthly basis.