Muonio (Finland): German luxury car manufacturer Audi seems to be very excited about the Indian market, but also seems to be worried about the growth of the luxury car segment. He believes that until high taxes are rationalized and reduced, the penetration of luxury cars in the country will remain less as compared to South East Asian countries. Additionally, Audi expects the growth of the luxury car segment in India to be moderate to low in 2024. In 2023 it was around 25 percent.
The entire car industry recorded growth
Speaking to the media, Audi India chief Balbir Singh Dhillon said that the entire car industry is growing rapidly. The luxury car segment is increasing. The industry recorded the highest growth last year. He said that India’s GDP is increasing. Whatever yardstick you put to the growth of the automotive industry, they are all growing. Therefore we believe that we are at the right place at the right time. This is India’s time and we will also continue to grow.
Luxury car sector is in its initial stage in India
On the potential of the Indian market, Dhillon said that if I compare the Indian luxury car sector, I would say that we are in the initial stage. He said that in many countries of the region, the penetration of luxury cars in the entire car market is five to six percent and in some markets up to 20 percent. He said that so I think we still have a lot to do.
Luxury car market will increase due to tax cut
Balveer Singh Dhillon said that reducing taxes and rationalizing them will help further boost the growth of the luxury car market in India. As of now, the total tax rate (including GST and cess) on most luxury cars is around 50 percent. He said that I am sure that at some point it will be rational, which will allow us to grow faster, as long as it continues to grow at a lower pace. Audi India sold 7,931 units in 2023 compared to 4,187 units in 2022.