In its effort to gain the number one spot in the luxury car segment, German auto giant, Mercedes on Thursday said it is contemplating to introduce models priced below Rs 20 lakh.
“Yes we are thinking in this direction,” Mercedes-Benz India managing director and CEO Peter Honegg said when he was asked if the company would introduce a model below Rs 20 lakh category to gain volume.
“I will not eliminate the case that we will have a car below Rs 20 lakh,” he added.
Honegg said the company will have 40% of its entire product range below the Rs 25 lakh range by 2015-16. The company plans to invest `250 crore on the new product line. The sub Rs 25 lakh products from the Mercedes stable are aimed to drive volumes in India.
He said the upcoming model A-class in next year could be priced in this range. The company will also introduce a sports utility vehicle based on the A-class platform.
Asked if Mercedes-Benz will source smaller engines from French car giant Renault with which the German firm’s parent Daimler has a global association for the Indian market Honegg said “the company may consider it in future although no decision has been taken yet”. Regarding what were the company’s plans about its forthcoming products he said, “In the next 5-10 years, 40 per cent of our new models will be below priced Rs 25 lakh... The premium segment which is in the range of Rs 20 lakh to Rs 30 lakh is witnessing good growth in India while the luxury segment above that is flat.
Mercedes-Benz India had lost its leadership position to compatriot BMW in 2009. This year it is likely to slip to the third position giving way to Audi India which is expecting to sell over 8,000 units.
Honegg said the company will close the year by selling almost the same number of cars sold in last year. In 2011 Mercedes-Benz s sales increased by 27.69 per cent to 7,430 units from 5,819 units in 2010.