One of the main factors of increasing luxury car prices is the rupee depreciation.German luxury carmaker Audi expects sales of luxury vehicles in the Indian markto grow in moderate single-digits in the ongoing calendar year due to tepid demand at the more affordable end of the market due to rising prices.
Balbir Singh Dhillon, Brand Director, Audi India, said, “I think broadly in the luxury space, last year the growth was muted. This year also we are anticipation a single digit growth, of about 5-7 per cent”. Around 52,000 luxury vehicles were sold in the local market last calendar year.
Dhillon added, “From our own self, more or less, we also are looking at the similar number (of growth),” Dhillon said about Audi India’s growth expectation in 2026.
Elaborating on the challenges in the luxury car market in India, Dhillon said while the C and D segments – broadly cars priced are above ₹75 lakh – have grown fast, now accounting for 49 per cent of the overall luxury car market, the entry segment has remained stagnant due to continuous increase in prices due to a variety of factors, including rupee depreciation and rising input costs.
“The C and D segments becoming 49 per cent is actually ‘good and bad’. Why it is good is that people are buying expensive cars, so the luxury is moving in the right direction but what is happening is that, since it is growing even faster than the overall luxury segment, the luxury segment itself has not grown beyond a point,” he said.
Dhillon said, in the first two months of the year, luxury vehicle sales have grown by 2-3 per cent. “One of the reasons, which I can make sense of, is the pricing. If you see the prices of the cars in the last five years, the prices would have gone up by 25- 30 per cent because every year there is a constant increase in the prices. This has made jumping into the next segment for those who are looking to upgrade from mass premium segment to luxury difficult as the cars have become expensive”, he said.
One of the main factors of increasing luxury car prices is the rupee depreciation. Dhillon said, “Last year, there was almost 19-20 per cent depreciation of the rupee against the Euro and this continues also this year. So this is leading us to kind of increase the prices. We have already announced upto 2 per cent price increase from next month.”
The company on Tuesday launched its luxury SUV SQ8 priced at ₹1.77 crore to expand its presence in the ₹75 lakh-above category.
