Thursday, June 25, 2009

Kolkata luxury car sales buck national trend

At a time when luxury car sales have dipped nationally, Kolkata is witnessing a reverse trend with more and more premium carmakers opening showrooms.

Before premium German brand BMW opened its first showroom in the city in May last year, its competitor Mercedes, managed to sell around 65 cars in 2007. Interestingly, in 2008, Mercedes managed to sell 80 cars, while BMW also sold 55 cars between May to December. “The market has indeed grown over the last few years, alomost doubling in 2008 over 2007. Moreover, around 50 per cent of last year sales of luxury brands has been achieved in the first quarter of the current fiscal”, said A Daga, director of Marks N Glix, that operates in the buying, selling and financing space of old luxury cars. Marks N Glix was originally in the car accessories business. It entered into the used car sales business in April 2008 seeing opportunity in the growing market. Around 50-60 used premium cars sell in Kolkata every year, the most sought after being the BMW 3-series.

Between January to May this year BMW has already sold 55 cars, and its only dealer in the region, OSL Prestige, is confident of selling another 120 cars during the year. Mercedes, in comparison, has sold lesser number of units. The company declined to share the sales figures. “While the East cannot be compared with the West or the North Indian markets in terms of size, it sure is growing at fast pace”, said a senior official of a Kolkata-based premium car dealership. In comparison, the downturn has hit these mature car markets, that is indicated in a 7.59 per cent dip in high-end car sales in India in May when the overall passenger car sales grew by 2.48 per cent.

According to data released by the Society of Indian Automobile Manufacturers (SIAM), in the first two months of the current financial year the sales of the high-end cars declined to 7,098 units from 7,149 units in the same period last year. In contrast, the Kolkata market had not shown signs of the downturn in 2009, primarily on account of the low base, insiders said.

Attracted by a lucrative market, another German premium car brand, Audi, is keen to open a showroom in the city within a couple of months even after its first deal with a local developer did not work out.

Audi recently launched its Q5 sports utility vehicle(SUV) that is available in eleven dealerships across India, but a Kolkata buyer now gets it transported from other cities. Its co-brands Volkswagen and Skoda are doing reasonably well in the region.

Volkswagen opened a Budge Budge Trunk Road outlet in March and has already booked 30 vehicles between March to May.

Volkswagen Kolkata, the dealership, now plans to open another showroom near the Eastern Metropolitan By-pass within the the third quarter of this fiscal. Skoda’s dealership, Jia Auto, informed that they were selling 35 cars per month on an average driven mainly by the demand for its hatchback, Fabia and the sedan, Laura. “These two cars account for 15-20 bookings a month”, said R Kothari, director of Jia Auto, the only dealership of the car brand in the region.

After the dealership started in June 2007, it witnessed a lull only once, during October to December last year, when it sold an average of 30 cars per month in comparison to 50 cars per month a year ago. Kothari added that sales had off late recovered from the downturn, and have gradually started picking up in the last three months.

Honda’s premium brand, the Accord, also saw a three-fold rise between January to May this year on a year-on-year basis.

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