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    Consumers getting high on high-end cars, electronics

    Synopsis

    Market intelligence data, too, reflects brisk demand for high-end cars, smartphones, TVs, laptops and refrigerators in stark contrast to the slowdown in the mass-to-mid segment. While sales of luxury cars grew 55% in the first six months of the year, that of super luxury cars (priced above ₹2 crore) are expected to breach the pre-pandemic peak of 2018 in 2022 according to industry executives.

    cars2iStock
    Luxury cars and premium electronic products are flying off the shelves as India emerged as one of the fastest growing markets for companies such as Lamborghini, BMW Motorrad, Mercedes-Benz India and Bosch Siemens in the first half of the year.

    Market intelligence data, too, reflects brisk demand for high-end cars, smartphones, TVs, laptops and refrigerators in stark contrast to the slowdown in the mass-to-mid segment. While sales of luxury cars grew 55% in the first six months of the year, that of super luxury cars (priced above ₹2 crore) are expected to breach the pre-pandemic peak of 2018 in 2022 according to industry executives.

    As per market and consumer intelligence firm GfK India, in Jan-to-May period, volume sales in offline retail of premium TVs above 55-inch screen grew 66%.

    Similar Trend in Smaller Cities
    In the same period, volume sales of 350-litre plus refrigerators rose 44%; of 8kg-plus washing machines climbed 29%; and of gaming laptops jumped 107%.

    The market for these products is still small and the low base tends to exaggerate the growth rates. Nevertheless, premium product makers are optimistic about growth prospects.

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    "We feel India will grow and grow strongly. This year, we (luxury vehicle makers) should come very close to the previous peak, and get a little more share of the overall passenger vehicle market," said Balbir Singh Dhillon, head, Audi India,

    Nikhil Mathur, managing director-India at GfK, said this upward trend of premium products is also visible in smaller cities and the increasing demand for multifunctional and smart products will continue to drive the premiumisation trend in the future.

    Apple's iPhone shipments have grown 23% this calendar year till May driven by the latest models priced above Rs 70,000, as per Counterpoint Research. The Rs 30,000-plus smartphone market is growing at 1.5 times the pace of the overall market driven by sales from brands like Apple, Samsung, OnePlus, Xiaomi and Vivo and financing offers, said Counterpoint's research director Tarun Pathak.

    Mercedes-Benz India, after posting record sales in the first half (7,573 units), still had pending orders for 6,000 units at the end of the second quarter. Italian luxury car maker Lamborghini has sold out the allocation for the current year and is on track to post its best-ever sales in the country.

    "India is adding the second highest number of billionaires in the world. Earlier, we were selling our cars to third/fourth generation businessmen. Now, our buyers are first generation businessmen, entrepreneurs, and women. The customer base has expanded," said Lamborghini India head Sharad Agarwal.

    For BMW Motorrad too - which makes luxury premium two-wheelers - India was the fastest growing market in the world in CY2021 and H1 CY2022. Even for German appliance maker Bosch Siemens, India has been the fastest growing market between January to May, clocking over 70% year-on-year growth in sales.

    The growth in the premium segment - which has been resilient ever since the pandemic - is driven by consumers who are less affected by economic turbulence. This is in contrast to a large section of Indian consumers who have cut down on discretionary purchases to conserve cash and spend on daily necessities.



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