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'And a majority will be in the top-end vehicle range.'
Mercedes-Benz India has posted strong sales in the first three months of calendar year 2023.
It has taken two price hikes and has been launching new products, including the SL 55 AMG.
">We are in no hurry to drop below the Rs 40 lakh-Rs 50 lakh price bracket for our EVs. But we are still committed to ensuring that in the next three years, 25 per cent of our sales will be EVs," Santosh Iyer, managing director and CEO, Mercedes-Benz India, tells Sohini Das/Business Standard.
After strong first-quarter sales, what is the expectation for the half-yearly numbers?
In the first quarter (January-March), we posted record sales (4,697 units), clocking 17 per cent growth, and we will release the half-yearly numbers in July.
We are confident of clocking double-digit growth for the second quarter (April-June).
We are hopeful that we will continue our double-digit growth rate for the full year.
This should be another record year for us; last year was already the best year in our history (15,822 units).
You have been focusing on top-end vehicles (TEVs). What is your game plan?
The composition of sales is very promising; about 25 per cent of our sales come from TEVs, which includes our super-luxury cars.
We will do 10 launches in the year, and a majority will be in the TEV range.
We started the year with an E-Class Cabriolet, launched the GT 63 AMG, then the A 45, and the G-Wagon, the SL 55 AMG.
We are on track and fully committed to the market.
We are happy that we can push the TEV segment and have a dominant share there.
Is there a slowdown in entry-level car sales for you?
For the entry-level luxury car segment, we are driven by product availability.
The GLC, which is the largest-selling product in our portfolio, has not been available since January.
We will develop a new GLC in the third quarter of the year.
The A-Class was not available for two months in a year because we had phased it out, and now we have a facelift.
These triggered some aberrations in that segment at the beginning of the year, but in the second half, we should see some improvement there with these two products.
Fundamentally, our strategy is to focus on TEVs.
When we look at entry-level products from our stable, our products are more expensive because they are more mature.
We don't have entry-level options. Our focus is on higher-end products, even if they are more expensive.
You have started a production ramp-up. How is it helping clear the backlog?
We have started the second shift production at our plant, and the second-quarter numbers should reflect that.
The order bank has reduced to 3,500, from the 5,000-odd order bank when we started the year.
With the second shift, our capacity has not doubled but increased somewhat.
One of the constraints is the availability of parts.
If we had had a parts supply, we could have even started a third shift.
The supply chain has improved; it's working, but there is some way to go. We are airlifting parts whenever necessary.
Are supply-chain issues driving up costs?
We did two price hikes this year: a 2-4 per cent hike in January and another up to 5 per cent jump in April.
This is primarily driven by rupee depreciation vis-a-vis the euro and a rise in input costs -- the supply chain being one of them, airlifting components, everything.
What about CBUs? Are you asking for more allocation from Germany?
For CBUs, we have had challenges; imagine telling a G-Wagon customer that his car will be available only in 2025.
We have a two-year waiting period for the G 63 AMG.
That is the reason we were able to secure an additional allocation for the G 400, which is a variant of the G.
We customised it into an adventure edition and offer it to customers.
Same for the SL class -- even before the launch, we had 30 car bookings.
A CBU's waiting period is between six months and two years.
Some completely knocked-down (CKD) cars like the C-Class and the A-Class are available now because of increased production, but some CKD models have a waiting period of five to six months for the GLS.
Eyeing 25 per cent sales from electric vehicles (EVs) by 2027, what's your line of attack there?
We have started with the top-end cars for our EVs and not localised entry-level cars. We have an EQS and an EQB.
We are in no hurry to drop below the Rs 40 lakh-Rs 50 lakh price bracket for our EVs.
But we are still committed to ensuring that in the next three years, 25 per cent of our sales will be EVs.
We will launch a few more products. We are happy with the EQS, which also has a few months waiting period.
Feature Presentation: Rajesh Alva/Rediff.com
