May 24, 2024

Today, the top luxury car manufacturers are investing heavily in smaller towns. Companies like BMW, Mercedes-Benz, Audi, and Lexus see potential in emerging markets in Tier II and Tier III cities, which are rapidly growing. The used car market and the increasing number of dealerships located in small towns significantly influence the popularity of luxury vehicles.

Audi India’s pre-owned car business saw the most significant sales ever in the quarter, with an increase of 50. “We currently have more than 300 cars available on the Audi Approved: plus portal across the country. In the past two to three years, the market for pre-owned cars has increased, especially in Tier-II and Tier-III cities. Our Audi Approved: plus (pre-owned) car business has grown from 7 facilities in 2021 to 23 facilities at the moment to meet this demand rise,” stated Balbir Singh Dhillon. The head of Audi India.

BMW Premium Selection plays a crucial role in the growth of the business. It is the very first pre-owned car business in India and stands out with its unique method of operation. BMW Premium Selection is a critical element that has given the necessary boost to BMW business operations across India and has brought many prospective customers who need to become more familiar with BMW. BMW brand, particularly from non-metros. A pre-owned car purchase lets customers feel the quality of the product along with customer service, after-sales, and sales process. This is a crucial decision-making element for buyers considering buying a new car shortly. BMW Premium Selection is an introduction to high-end luxury options for many consumers who want to upgrade to becoming first-time luxury purchasers. “BMW Premium Selection has provided a vital impetus to BMW operations in India and has introduced many new customers to the BMW brand, especially from the non-metros,” said Vikram Pawah, the president and CEO of BMW Group India.

In a similar vein, Lance Bennett, sales and marketing, Mercedes-Benz India, said, “Mercedes-Benz Certified, Mercedes-Benz Marketplace, and the newly launched pre-owned cars online store enable customers to select a car of their choice from the available range of pre-owned Mercedes-Benz cars. The flexibility and trust of these programs have resulted in significant growth in sales in mini metros.”

According to Lexus India, almost 40 percent of its sales in the used automobile segment are generated in Tier II and Tier III cities. “This upward trend is taking place parallel to customers getting interested in the opening price ranges of the luxury car brands, leading to simultaneous growth in the market,” said Naveen Soni, president of Lexus India.

Dealership Stores

Luxury automobiles bring dealerships with international standards to India. BMW Group India aims to increase the market size in the Indian premium car industry by establishing solid and committed dealer partners. “We have set a decisive course by establishing over 80 touchpoints in 35 cities across the country and remain customer-centric by setting very high benchmarks in service quality and customer care,” said Pawah, CEO of BMW Group India.

Mercedes-Benz is in 45+ cities and has more than 123 contact points. Mercedes-Benz launched the ‘Direct to Customer model in 2021, known as the Retail of the Future (ROTF) for sales channels. “With our new business model, ROTF, Mercedes-Benz India sets the price, provides inventory, and invoices to customers directly. The customers get the best price guarantee, a seamless purchase process, complete transparency, and the best customer experience. This is an omni-channel model spanning both traditional and digital retail formats, thus building a strong focus on e-commerce as customers can finish the booking process from their homes,” said Bennett from Mercedes-Benz India.

Lexus India has established an extensive presence, with 23 touchpoints in 16 vibrant cities. “Over the last year, we have added eight Lexus service points. We are also opening smaller brand spaces called Meraki,” said Soni, president of Lexus India

Lexus had 56 percent of its market territory covered in the first quarter of last year, with seven major cities. Lexus also added eight service locations and has already added another Meraki in Gurgaon, Coimbatore, and Pune. “With this, by the end of the year, we are planning to be close to 85-86 percent of the market. Beyond this, we have also launched Lexus Virtual Dome- an online experience touch point that will enable our guests to experience Lexus virtually. Our plan is to open more of these service points, which could take us to around 90 per cent of the luxury car market, wherever Lexus is present,” said Soni.

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