Indian Luxury Car Market Changing Lanes

Abstract

Aston Martin has recently introduced itself to India. Many perceive it as a routine entry of another car maker. However, this specific entry isn’t coincidence, but a calculated move. It has to do with the recent unexpected growth in the Indian luxury car market which is more than just market dynamics. It is something which reflects a changing lifestyle pattern of a class which is called affluent. The growth rate for these cars with a price tag which is above Rs. 25 lacs has been 20% on average for the some years. When the whole world was facing recession the Indian luxury car market grew by 23% to 6671 units as per the Society of Indian Automobile Manufacturers (SIAM) despite half a percent decline in passenger car sales, to 11.04 lakh vehicles (Dovel, 2011). 2010 has shown growth in the automobile sector which was up by 25%. Indian luxury car market had been dominated by Mercedes Benz (entered in India in mid 1994) until 2009 where it was outscored by BMW which entered India in 2006. Mercedes Benz’s market share of 90% shrank to 38% and its market share largely fell to BMW which has 42%. This case will study the factors responsible for the growth of the Indian luxury car market with reference to BMW’s quick growth to the top with the help of cars customized for Indian infrastructure conditions, an aggressive distribution strategy, pricing designed in lieu of competition, and comprehensively smart promotional efforts.