Mercedes-Benz India expects further sales recovery in festive season

The company sold 2,948 units during January –June 2020 period as compared to 6,561 units, a year ago in the same period.
July sales have shown first signs of a gradual recovery, however, it will take some time to reach the pre-Covid levels, said Martin Schwenk, Managing Director & CEO, Mercedes-Benz India. The company said it was sticking to its upcoming launches.

“We are cautiously optimistic as we witness early signs of a revival of customer sentiment. This is once again underlined by a satisfactory July sales, especially under current circumstances. This only shows there is a lot of pent-up demand in the market and wherever the situation has stabilised, we have seen demand gradually coming back,” said Schwenk.

The company sold 2,948 units during January –June 2020 period as compared to 6,561 units, a year ago in the same period. The drop in sales was primarily affected by the market shutdown due to the pandemic.

While the company did not share July numbers, retail numbers released recently by the Federation of Automobile Dealers Associations (FADA's) shows that the company sold 418 vehicles in July 2020 as against 786 in July 2019. BMW sold 258 units in July 2020 as against 685 units, a year ago.

SUV accounted for about 57 per cent of June sales. The newly launched GLS SUV has received good response. The company had over 8,000 leads generated through its online platform during the second quarter alone.

"The strong double digit month-on-month growth from May onwards makes us confident of a good festive season. Our new products like the GLE, GLS, GLC and customer centric finance programmes like Wish Box 2.0 are the key enablers in driving this growth factor," said Schwenk.

"The company was planning to launch ten new vehicles, of which seven are already launched and the rest are on track with other planned launches, though there may be some delays which cannot be avoided under the present situation," he said.
New electric vehicle under the EQ brand, will be launched around the festival season.

Although a majority of the company's customers are located in large metros and Tier 1 cities, the company has been witnessing burgeoning interest from Tier II & even Tier III markets. The non-metros contribute 15-25 percent of the total volumes and the company expects to see the next wave of demands coming from these markets.

"With increased social distancing norms now prevalent, the company sees growth in personal mobility space but it will primarily be focused in the entry segment of the industry, not much at the luxury segment," said Schwenk.

Company's used car sales saw a good traction during this period. Mercedes-Benz Certified' has sold over 20,500 units of pre-owned cars over the last five years and witnessed 20 per cent cumulative growth Models like C-Class, E-Class, GLC, GLE and the newly launched GLS are continuing to drive sales post lockdown.

“Our supply chains have proven to be very robust, with the flexibility we have in our logistics and production system we could manage the challenges. Supply ramp-up is an ongoing process, and we expect things to stabilise over a period of time and expect demand to return to the pre-Covid level”,  said Schwenk.

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