The Telegraph
Wednesday , October 3 , 2012
Since 1st March, 1999

Luxury wheels expand base

Two German luxury car giants are opening their second outlets in the city braving a depressed market.

While OSL Prestige, Calcutta’s only BMW dealer, is opening a sales outlet on AJC Bose Road, opposite the Audi showroom, Mercedes Benz is in the process of appointing a second dealer in the city.

A BMW spokesperson played down the company’s move, saying: “It’s a dealer activity; a part of our nation-wide strategy to have bigger showrooms, more space and bigger display of our cars as our market grows.”

Debasish Mitra, sales and marketing director of Mercedes Benz India, said: “We are on a massive dealer expansion drive and the east figures very prominently in our sales strategy. We are going to open a second dealership in Calcutta and we will have dealers in Bhubaneswar, Patna and Jharkhand.” Mitra was in the city last week to launch the B-Class, priced upwards of Rs 26 lakh.

The east’s contribution to the national sales of luxury cars is only about one per cent with the north and the west making up more than 80 per cent and the rest coming from southern India.

The companies seem to be optimistic about the market despite the fact that excise duty has been hiked from 24 per cent to 29 per cent for imported cars and road tax by 300 per cent.

“A customer has to pay Rs 6 lakh in road tax if he is buying a Rs 60 lakh vehicle. Things are slow on the sales front as the lifetime road tax along with hike in excise duty has dampened customer sentiments,” said Vinod Agarwal, the CEO of the Jaguar-Land Rover outlet in the city.

BMW, however, has experienced “satisfactory sales till now”. “We are yet to experience the impact of the road tax hike,” said Charchit Mishra, the owner of OSL Prestige.

The Calcutta dealers of the three German luxury wheels are set to cross the 200 unit sales mark this year. Audi and BMW have each sold 200 units so far this year and Mercedes has clocked 123 units.

“We will easily cross the 250 mark this year,” said a BMW salesperson at the OSL outlet on the EM Bypass. With the sales of the new 3 Series picking up, Mishra said: “We are trying very hard to ready our second outlet before the Pujas.”

While celebrating its 10th year in business, Interkrafts CEO Hiteswar Singh said: “The move (to appoint a second Mercedes dealer) was to cope with a future rise in demand for its cars following the product offensive that the company is going to launch starting this festive season. The company hopes to more than double its sales in the city.”

Interkrafts hopes to close the year with sales of about 250 units. When asked if the city has enough buyers to warrant a second dealer, Singh said: “The company feels the market will grow with the new products and Calcutta will see sales of 500 Mercs in a year by the time the new dealership is operational. The company is multiplying dealerships all over the country.”