Tamil Nadu has seen an increase in registration of luxury cars among a growing affluent population.
According to data sourced from the State’s Commissionerate of Transport and Safety, there has been an increase in registration of motor cars for which the sale value is over ₹30 lakh. In 2023-24, 8,475 such cars were registered in the State – an increase of about 46.2% from 5,797 cars in 2022-23.
In 2021-22, 3,954 cars were registered, as against 2,816 cars in 2020-21 (which was impacted by the COVID-19 pandemic). In 2019-2020, 4,187 cars were registered. “While there is no standard definition for luxury cars in India, generally they are known by brands such as BMW, Audi, Mercedes-Benz, and ultra luxury brands such as Rolls-Royce,” auto industry expert Som Kapoor, Partner at EY Future of Mobility, said.
Tamil Nadu has seen an increase in registration of luxury car brands too. In 2023-24, 2,714 luxury cars were registered – an increase of about 19.3% from 2,275 cars in 2022-23. In 2023-24, the BMW saw the highest registration at 1,192 cars, followed by Mercedes-Benz at 1,122 cars. Other brands include Jaguar Land Rover (217), Porsche (84) and Audi (77).
The State also witnessed registration of ultra-luxury brands such as Rolls-Royce (4), Ferrari (1), Maserati (3), Aston Martin (1), Bentley (7) in the Chennai Zone during 2023-24.
The Chennai Zone saw the highest number of luxury brands registered at 1,668 in 2023-24. It was followed by Coimbatore Zone with 510 cars, Madurai Zone, 110; Tirunelveli Zone, 95; and Tiruchi Zone, 65.
Vikram Pawah, president, BMW Group India, said in terms of sedans vs sports activity vehicles (SAVs), the preference of customers in the State was almost the same towards both. “However, we see an increasing popularity of SAVs in the region. The most popular sedan is the BMW 3 Series, while popular SAVs include BMW X1, BMW X3, BMW X5 and the flagship model BMW X7,” he added.
The luxury class models, BMW 7 Series, BMW X7, BMW i7 and BMW XM, command a sizeable portion of sales, Mr. Pawah said, adding: “The customer base for luxury cars has evolved tremendously in the last decade. Apart from traditionally wealthy families, a new group of achievers having a global outlook and an eye for luxury products has emerged in India. Young entrepreneurs and leaders are actively shaping the demand for luxury car market. With the rise in disposable income, they are not hesitant to spend on luxury products and services...”
Santosh Iyer, managing director and CEO, Mercedes-Benz India, said there was a strong affinity for top-end luxury sedans such as the S-Class and Long Wheelbase E-Class in Chennai, and in the State. Customers in the State also love Mercedes-Benz SUVs like the GLA, GLC and GLE, he said, pointing out that Mercedes-Benz outpaced the overall luxury car industry market in Tamil Nadu, growing by 6%, even as the industry grew by 2.5% in January to June 2024.
The customer base for Mercedes-Benz in Tamil Nadu comprises an interesting mix of businesspersons, entrepreneurs, real estate developers, start-up founders, and professional clientele such as doctors, lawyers and salaried corporate professionals, Mr. Iyer said, adding: “Apart from the important hub of Chennai, we are witnessing a rising customer demand for our cars from established markets such as Coimbatore, Tiruchirapalli, Madurai, and Salem; and from emerging markets such as Kancheepuram, Tiruvallur, Erode, and Tiruppur. The trend is encouraging as it underlines the development and potential growth of Tamil Nadu as one of most advanced economies across the country.”
Balbir Dhillon, head of Audi India, said that over the past three years, the company observed a notable increase in sales within the region. “It is a market that has an appetite for performance cars. From the very loved Audi Q3 right up to the flagship RS e-tron GT, our sports electric car, (costs upwards of ₹1.9 crore) - we have witnessed good demand. Our RS range specifically has many brand fans and buyers in the region,” Mr. Dhillion added.
After COVID-19, many youth and emerging entrepreneurs are purchasing top-end cars. Today, 70% of our customers are aged below 50, he said.
EY’s Kapoor said that in the recent years, luxury car sales had seen good traction in metros, Tier-II and Tier-III cities. Yet, they account for only 1% of the overall passenger car market in India. The growth of luxury car sales has been faster than the traditional cars, and the trend is likely to continue, he added.
Published - July 29, 2024 12:55 am IST
