The Rise of Luxury Car Market in India

19/10/2023 - 11:11 | BMW,  ,  ,   | IAB Team

The luxury car market is increasing in demand due to the introduction of customer-friendly financing plans and diverse models, especially for high-end car buyers in India. While the car market experiences a growing preference for electric cars, major car manufacturers such as Mercedes, BMW, and Audi are introducing new upscale car models. This article details the rise of luxury cars and lists popular car brands in India.


Analysis of the Luxury Car Market in India

According to a 2021 study, the luxury car market in India was valued at $1.06 billion. By 2027, this value is expected to reach over $1.54 billion, recording a compound annual growth rate (CAGR) of more than 6.4%.

With the effects of the COVID-19 pandemic, the market sales of luxury vehicles were negatively affected because of lower footfalls in the showrooms. As a result of the country-wide lockdown imposed by the government, many automobile manufacturers had to temporarily shut down their production, restraining the growth of the market.

Over the years, as manufacturers of luxury cars are launching various models with varying price ranges, the demand for luxury cars in India is only expected to grow. These cars also provide extra comfort and space. Major car manufacturers such as Audi, Mercedes, and BMW are planning to introduce new models in the country at a reasonable price.

Apart from these factors, the rise of electric cars in the market is expected to increase and further gather support from active key players during the forecast period. Individuals seeking to indulge in luxury cars can now effortlessly access information on how to buy a car online, making the entire process streamlined and efficient.

Popular Luxury Car Brands in India

With improved paychecks, more people are moving towards luxury cars to stand out from the crowd. Here are common luxury car brands in India that are currently available.

1. Mercedes-Benz

The most popular luxury car brand in the Indian market is arguably Mercedes-Benz. Mercedes has received acceptance on Indian roads over the past decades. It officially entered the Indian market in 1994. India has sold around 21,000 luxury cars in the first six months of 2023. E-class LWB is the top-selling Mercedes model in India.

In addition, Mercedes's success can be attributed to its wide range of car offerings in the country. While the A-Class Mercedes model in India is the most affordable with an initial price of Rs. 42 lakh, the Mercedes-Maybach GLS SUV model begins at Rs. 2.92 crore.

2. BMW

BMW is the third German giant available in the luxury car segment in India. BMW first entered the Indian market in January 2007 and has managed to obtain its niche among Indian buyers. BMW offers various segments to cars including plug-in hybrids and fully electric. X1 BMW is the best-selling model in India with a price starting from Rs. 45.9 lakh.

3. Audi

Audi is a German luxury car brand that has gained significant attention in India. Audi attracted many people within a short time span after arriving nearly 13 years in the country. Similar to other car manufacturers internationally, the Audi car brand has been struggling to bridge the gap between demand and supply caused by the shortage of semiconductors.

Audi Sedan- A4 is the top-selling car model you can purchase in India. While the Audi A4 model price range starts from Rs. 43.85 lakh, the RS Q8 SUV costs more than Rs. 2.2 crore.


With multiple models available at diverse price brackets and customer-friendly financing plans, the luxury car market in India is experiencing a surge in demand. SUVs with high-end features are particularly popular due to their additional space and comfort. Car manufacturers like Audi, Mercedes and BMW are strategizing to launch the latest upscale car models at competitive prices in the country.

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