Luxury on Wheels: Mercedes-Benz Sees Record Growth as EVs and SUVs Dominate

Mercedes-Benz India has scripted a stellar chapter in its growth story, registering a robust 36 percent year-on-year sales increase in September 2025, marking the brand's highest-ever monthly performance. This surge, retailing over 2,500 units in just nine days during the Navratri festival, underscores the luxury automaker's dominance in a market where affluent buyers are increasingly prioritizing premium experiences. The momentum was supercharged by the government's GST 2.0 reforms, introduced mid-August, which alleviated deferred purchases and ignited customer confidence, leading to a festive sales peak that shattered previous records.

As India's luxury car segment—valued at over ₹50,000 crore annually—continues to outpace the broader auto industry, Mercedes-Benz's success reflects broader economic optimism, with urban disposable incomes rising 12 percent year-on-year per recent Nielsen reports.

The September triumph propelled Mercedes-Benz to its best-ever Q2 FY 25-26 performance, with 5,119 units retailed between July and September, contributing to a half-year total of 9,357 units—a 4 percent growth over the prior period. This quarterly high was underpinned by balanced demand across segments, particularly the 'Top-End Luxury' category, which achieved 25 percent penetration and 12 percent year-on-year growth. Models like the GLS SUV, S-Class sedan, Mercedes-Maybach lineup, and AMG G63 commanded premium preferences, with hyper-personalization via the bespoke 'manufaktur' program—offering exclusive materials and craftsmanship—accounting for 75 percent of top-end sales.

Despite a six-month waiting period, the AMG G63 notched its highest monthly figures, highlighting the allure of high-performance luxury in a market where SUVs now comprise 60 percent of Mercedes' volumes. The 'Core Luxury' segment, including the Long Wheelbase (LWB) E-Class, GLC, and GLE SUVs, grew 10 percent, with the LWB E-Class solidifying its throne as India's top-selling luxury sedan via a 47 percent surge, blending opulent features like MBUX infotainment and advanced ADAS.

Electric vehicle adoption remains a cornerstone of Mercedes-Benz's strategy, with battery-electric vehicles (BEVs) reaching an 8 percent penetration rate in overall sales, up from 7 percent last year. The BEV portfolio expanded 10 percent in Q2, led by record sales of the EQS SUV, while the flagship G 580 with EQ Technology sold out for 2025, opening bookings for subsequent slots. This aligns with India's EV luxury push, where incentives under FAME-III and state subsidies have boosted adoption amid a national target of 30 percent electrification by 2030.

However, the 'Entry Luxury' segment—featuring the A-Class sedan and GLA SUV—faced a dip due to aggressive pricing from rivals, emphasizing Mercedes' pivot toward higher-margin offerings. Managing Director & CEO Santosh Iyer noted, "We are cautiously optimistic that this festive momentum will sustain through October," eyeing double-digit growth amid wedding seasons and potential trade pacts.

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As competitors like BMW and Audi trail with 25-30 percent market shares, Mercedes-Benz's 2025 trajectory—aiming to match or exceed 2024's 19,565 units—signals a maturing luxury ecosystem in India, driven by a burgeoning millennial HNWI class (projected to hit 1.5 million by 2027). With expansions like 21 new MAR20X outlets under the 'Go to Customer' initiative, the brand is deepening Tier-II city penetration, from Udaipur to Patna, where 75 percent of sales traditionally hail from metros like Mumbai and Delhi. This September's feat not only cements Mercedes' leadership but also spotlights policy reforms' ripple effects, positioning India as a global luxury hub.

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