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The Luxury Car Market Is Seeing A Sudden Surge Of Interest. Once Starved For Choice, The Country's Nouveau Nawabs Now Have A Wealth Of Luxury Cars To Choose From, Reports Varuna Verma Published 10.12.06, 12:00 AM

Nadeem Ahmad has been making a list of all the smooth-flowing, six-lane highways around Bangalore. Come weekends, and he hits the road in his new dolphin-grey Audi A6. “Sometimes, I drive to nowhere and back,” says the Bangalore-based businessman.

The Audi was always Ahmad’s dream car. He admires everything about the executive-class saloon — from its low-slung windows and coupe-like roofline to the rush of power to the wheels when the sedan revs to life. “The car looks indestructible and the technology is hard to fault. There is so much room in the rear that two occupants can travel in splendid isolation,” says Ahmad.

When the German car was launched in India in 2004, Ahmad lost no time in booking one. “Earlier, only second-hand luxury sedans were available. Now, we get the best in the world,” says Ahmad.

The market for the super luxury car — built with the highest level of perfection with regard to technology, safety, looks, drivability and passenger comfort — is seeing a sudden surge of interest in India. Once starved for choice, the country’s nouveau nawabs now have a wealth of luxury cars to choose from. Most of them are still imported, but the legendary Bavarian Motor Works (BMW) — the car with the famous snout — will be assembled in Chennai starting early next year. The plant will begin with the production of the 3 series model. BMW — which already imports cars to India — hopes to sell 1,800 Bimmers a year.

There’s more. Volvo is getting two car models — the S80 and XC90 — to India next year. “India is the second fastest growing car market in the world. Improving economic condition of the people is going hand in hand with an increase in purchase of luxury goods,” says Belgium-based Paul de Voijs, managing director, Volvo Car India.

Also, Lexus, Jaguar, Ferrari, Volkswagen and Agent 007’s pet, the Aston Martin, are firming up plans to drive into India. “Jaguar will sell in India from this month. The other companies are expected by next year,” says Ranojoy Mukerji, editor, Auto India, a journal devoted to automobiles.

The big daddies of luxury and performance sports cars are already here. While Daimler Chrysler has been around for over a decade, Audi, Porsche, Bentley, Lamborghini, Rolls Royce and the Land Rover entered the market in the last few years.

With poor infrastructure and a strict tax system, India was traditionally assumed to be a small car market — at best it could boast of a mid-sized Cielo or an Opel Astra. “But now, with disposable incomes going up, people are spending more on luxury goods than ever before,” says Hormazd Sorabjee, editor, Autocar India.

In 2004, 1,000 super luxury cars were sold in India; in 2005, the figure rose to 3,000. This year, Mukerji holds, sales are expected to close at 5,000 cars.

Tagged at Rs 6 crore, Daimler Chrysler’s (DC) luxury saloon, the Maybach, is the costliest car to come to India so far. But that hasn’t stopped the sales of the company from speeding. Last year, DC sold 117 imported cars — ranging from the May- bach to the M Class Mercedes — in India. “This year, 147 cars were sold by October,” says Manas Dewan, senior manager, corporate communications, Daimler Chrysler India.

DC’s locally-manufactured flagship car, the Mercedes Benz — whose models are priced between Rs 28 lakh and Rs 80 lakh — has a much larger piece of the road. “Last year, 2,010 Mercedes Benz were sold in India . This is the highest sales recorded so far,” says Dewan. DC is now setting up a second and bigger manufacturing plant in Pune.

The favourite car of the maharajahs, the Rolls Royce, made a comeback to India after half-a-century, in April 2005. In one year, eight Rolls’ Phantom — which can accelerate to 100 km in 5.9 seconds — were sold. “Despite over 100 per cent import duty, sales of imported BMWs were soaring. So the Rolls, which belongs to the same group, also followed suit to India,” says Sharad Kachalia, marketing head at Mumbai-based Navnit Motors, dealers for Rolls Royce, BMW and the Land Rover.

In September this year, Audi added an SUV — the Q7 — to its India portfolio, taking the total number of models in the country to four. Audi sold 350 automobiles — priced between Rs 28 lakh and Rs 1 crore — in India this year. And while buyers may not need ads to help them make up their minds, the car is being promoted subtly —Amitabh Bachchan will be seen driving an Audi A8 in a forthcoming film. In real life, the company gifted an Audi A6 to the highest spender at Bangalore’s Forum Mall, during the last Dussehra season.

Porsche, Lamborghini and Bentley are present in India through the importer-distributor route. The fancy Lamborghini and Bentley showroom in New Delhi’s Ashoka Hotel provides customers with the same experience as any Bentley or Lambo client worldwide. “It’s part of the company’s marketing strategy to talk to an exclusive clientele,” says Satya Bagla, head, Exclusive Motors.

Daimler Chrysler conducts road shows where the company’s CEO and directors are present to bond with customers. DC’s potential customers are sent invitations for the Mercedes golf trophy and ATP tennis tournaments that the company sponsors.

For India’s burgeoning rich, cars are a great way of getting mileage out of their millions. “But the middle-aged CEO who has arrived in life is no longer our only target customer,” says Daimler Chrysler’s Dewan. “The young, high-aspiring generation now buys luxury cars.”

There are cars and then there are style statements. As the service industry grows in India, it requires professionals to dress and drive smart. “Unlike an agrarian or manufacturing industry, looks matter in the service industry. Which means, a good car has become an important business tool,” says Audi’s Malhotra.

The auto markets in Europe and the US are nearing saturation. A white paper released recently by Keystone India, The World’s Top Auto Markets by 2030, projects that over the next quarter century, 69 per cent sales will move to emerging markets replacing the mature markets of America, Europe and Japan. The report predicts that China and India will dominate this transition.

Just fasten your seat-belts.

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