[abhijit 2284]

the fun will be in the jan to march figures , they will tell the real impact of the current market situation

[GTO]

Originally Posted by Sahil

although I did expect the E sales figures to be much lower,

Likewise.

but I guess the heavy discounts have pulled it up.

Maybe a 70 - 80 cars at the max, but not enough to impact its overall performance too much.

On all other segments i prefer the Merc- C & S over the current 3 & 7.

Manual C > 3 anyday. However, I am taking a liking for the clean straight lines of the fresh 7. It is a classic. Lets see how it drives, but based on initial impressions, it would be my pick over the quirky S.

@GTO: MBIL has confirmed these service packs?

Lets just say a li'l birdie has been talking about it.

Originally Posted by vasudeva

Both BMW and Merc. recorded huge growth till Aug/Sep 08, but then also huge declines during Oct-Dec 2008. So, 2008 PR may be good, but let us see 2009 early PR.

True. 2009 is expected to be a blood shed here. I can hardly wait to receive the Jan numbers from you.

PS: GM used to put out monthly PRs on record growths till around Apr/May 2008 (Spark base effect of Apr 07). From June onwards, they stopped appearing but then suddenly appeared in 12/08 recording their overall sales growth.

[Mpower]

Wow! Amazing performance by BMW, considering that Mercedes has had a 12 year lead in India.

Although Merc is ahead overall, in terms of marketshare BMW have carved a nice chunk for themselves. This year will be interesting with Audi coming in full force.

[GTO]

Absolutely. BMW's tasted blood and now want no lesser than the top spot. With Audi entering the fray (1000 odd cars in 2008), we can only look forward to some exciting battles in the premium segments.

[kbk_75]

I guess the most telling statistic is that between the three of them (Audi, BMW, MB) they have sold less than 8,000 cars in what is, by their own admission, a record year. This is where our crazy duty structure plays a key role. If the cars weren't so expensive because of the duty structure there would be more sales, if there were more sales, the big three would be willing to operate on smaller margins, further propelling sales. It's a catch twenty-two really.

I'm pretty certain if the duty structure on CBUs was dropped to say 66% (just for argument's sake) and the entire benefit was passed on to the customer, the sales figures would double in a normal economy (not like what we're experiencing right now). This would more than off-set the reduction in duty in absolute terms and everybody would gain. The same sort of reduction in taxes could be applied to the local manufacturers by reducing excise and other local taxes.

[ajmat]

Of the 12 years. MB spent 6 years learning - a hard lesson as they nearly became a BIFR case until they sold 300 S classes with big margins. The others merely had a free ride after observing

[GTO]

Originally Posted by kbk_75

I guess the most telling statistic is that between the three of them (Audi, BMW, MB) they have sold less than 8,000 cars in what is, by their own admission, a record year.

A record indeed. 8000 luxury cars is big time!

This is where our crazy duty structure plays a key role. If the cars weren't so expensive because of the duty structure there would be more sales, if there were more sales, the big three would be willing to operate on smaller margins, further propelling sales.

I wouldn't put the blame of their astronomical pricing entirely on duty structures. The C, 3, E, 5 & S are locally assembled. Plus, the duty structures in the last 10 years have only gotten more reasonable with time. However, a C Class retails for 40% more than what an E Class sold for 10 years back! And the price of the top E Class is double that of 1995.

Originally Posted by ajmat

Of the 12 years. MB spent 6 years learning - a hard lesson as they nearly became a BIFR case until they sold 300 S classes with big margins. The others merely had a free ride after observing

Well put! How can we forget the early days.

[vasudeva]

It is not just in India where the luxury market seemed immune from the overall general slowdown till around Sep 08. Look at the eco. activity and car sales worldwide and you may find the luxury market declining lower than general car market till around Sep 08, but then tanking since Sep 08. Seems like the high rollers are also getting hit.

In US, BMW and Daimler declined 9.7% and 1.4% in 2008 (12 months) but 36% and 24% in 12/08. In Europe, double digit declines have been reported in the luxury car market from around Oct/Nov.

[kbk_75]

Originally Posted by GTO

I wouldn't put the blame of their astronomical pricing entirely on duty structures. The C, 3, E, 5 & S are locally assembled. Plus, the duty structures in the last 10 years have only gotten more reasonable with time. However, a C Class retails for 40% more than what an E Class sold for 10 years back! And the price of the top E Class is double that of 1995.

No, it's definitely not entirely due to duty, but it does play a large part. As for the relative high pricing vs 12-13 years ago, blame the Euro and it's ever increasing strength for that. When MB launched the E class here, Germany was trading with a relatively weak Deutsche Mark. When the Euro was adopted the relative prices of most items went up. Also the Euro has gone from Rs. 40 to Rs. 65 + in ten years.

[srh]

Originally Posted by kbk_75

When the Euro was adopted the relative prices of most items went up. Also the Euro has gone from Rs. 40 to Rs. 65 + in ten years.

That is not the customer's problem and neither is it the government's problem. If companies cannot mitigate their currency risk through a global manufacturing and distribution set up, they are themselves to blame for

[Mpower]

Originally Posted by srh

That is not the customer's problem and neither is it the government's problem. If companies cannot mitigate their currency risk through a global manufacturing and distribution set up, they are themselves to blame for

No one's gonna do local manufacturing if all that Indians can afford to buy are 500 cars a year (each model). The customer has no option but to pay up.

[kbk_75]

Originally Posted by srh

That is not the customer's problem and neither is it the government's problem. If companies cannot mitigate their currency risk through a global manufacturing and distribution set up, they are themselves to blame for

This was an exceptional circumstance and was a consequence of trying to switch more than a dozen currencies into one overnight. Most things in Germany became more expensive overnight when they switched to the Euro.

The problem was caused by the Governments in Europe, actually, so it was their problem. To be honest it was also the customers' problem, because the increased cost was passed on to the customer. Tsk...

Originally Posted by Mpower

No one's gonna do local manufacturing if all that Indians can afford to buy are 500 cars a year (each model). The customer has no option but to pay up.

This is the point I was making, it is, sadly, a catch twenty-two.

[GTO]

Originally Posted by GTO

Turns out, neither is it too close nor is BMW ahead. Plus, if you look at the model-wise sales below, it seems unlikely that BMW will overtake Mercedes in the near future.

Looks like I spoke a little too soon. BMW is giving Mercedes the clobbering of its life, despite the latter have a massive 10 year lead.

January 2009
BMW : 270 cars
Mercedes : 79

February 2009
BMW : 244
Mercedes : 226

March 2009
BMW : 478
Mercedes : 443

Cumulative Jan - Mar 2009 : BMW is ahead with 992 cars moved, compared to Mercedes at 748 cars.

Originally Posted by GTO

Absolutely. BMW's tasted blood and now want no lesser than the top spot.

Class act by BMW : Their image building exercises, dealership network, 5 series engine options + positioning (majority of BMW sales) and 5 year ownership packages were all brilliantly handled.

What can Mercedes do? The C & S are way ahead of the 3 & the 7 already. It's the 5 series that is the most significant contributor to BMWs success. The fresh new E Class has the potential to turn the tide in Merc's favour. Will the Indian market take to the new (weird) design?

And yes, last but not the least, WHEN are you releasing your 5 year maintenance packages Mercedes? Move that lazy derriere, will ya?!

[ajmat]

I think the current dip is also due to production stoppages whenshifting to the new factory and the E class phase out.

Saying that, the competitive pricing and ownership packages from BMW make a big difference

Audi - where are you ?

[rrsteer]

"despite the latter having a 10 year lead" -

I think this statement is misplaced and downright wrong. Its probably valid for products where you have to build a market from scratch - or where you have to push products. But not in case of luxury cars, which is more of a pull market and less of a push market.

If anything, I would put Mercedes longer presence in the Indian market as an overall negative. Yes, it enabled them to put in place a better car dealer and service network, but it also greatly reduced the novelty of owning a merc. With BMW suddenly coming in, BMW seemed a lot more fresher and an appealing brand to own and also gave a better opportunity to being different. That said, BMW already had a fresher appeal.

As far as I know the drastic fall in Mercedes Jan shipment was due to production issues (as told by the dealer). Consequently a lot of buyers defected to BMW and Audi.