Mercedes-Benz Expands In India With New Outlets To Tap Growing Luxury Market: Report

Mercedes-Benz MBGYY plans to expand its presence in India with 20 new outlets in 2025, focusing on smaller cities where young, affluent entrepreneurs are driving demand for luxury goods.

This marks a cultural shift among India’s younger generations, who are moving away from the thrift-focused mindset of their predecessors to embrace indulgence in premium products.

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“Now the second and third generation have taken over the family business, and these guys have studied abroad, come back, and are able to consume without guilt. It is not only cars, but even watches and other luxury,” reported Reuters, citing Santosh Iyer, CEO of Mercedes-Benz India.

Mercedes has observed higher demand for premium and electric vehicles in cities like Kanpur and Patna, where infrastructure like stand-alone homes supports easier EV charging. The company plans to expand its service centers in such areas after achieving record 2023 sales of 19,500 vehicles—a 12% increase—driven by strong EV sales, which nearly doubled.

Despite this growth in smaller cities, major urban centers like Mumbai and Delhi still dominate, accounting for 80% of Mercedes’ total sales, with luxury cars capturing a 2-3% market share. In smaller towns, luxury vehicles represent just 1.1% of the market, indicating significant room for growth.

“Top-end cars continue to grow and outgrow entry and core segments also. These are promising signs on the changing structure of the market,” Iyer added.

Price Action: Mercedes-Benz shares closed 2.07% lower at $13.73 on Wednesday.

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