Sunday, April 2, 2023
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Inflation made luxury cars even more expensive but sales remain in fast lane. See Mercedes

For years, the luxury car market in India was biased towards the entry-level. But today, cars below Rs 40 lakh account for the smallest fraction of sales.

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Back in 1995, soon after completing my Class X Board exams, a few friends and I went on our first ‘boys’ trip to a small hamlet above Rishikesh called Narendranagar. It was the base of a medium artillery regiment where a friend’s father had served and we stayed as guests of the Commanding Officer. During our stay, we were taken to the construction site of the Tehri Dam. Back then, the dam was a highly controversial project, with environmental activists mounting huge protests against displacement and of course, the seismic impact of a huge dam. The construction site was not exactly the best place for a group of teenagers to have a picnic, but it was fascinating to observe the foundations of a huge dam being laid and the diversion tunnels taking the waters of the Tehri River around the construction site.

So recently, when I was driving the brand-new Mercedes-Benz C-Class down from Mussoorie to Dehradun, I saw that at the town of Chamba, I could take a diversion to see the Tehri Lake, the massive reservoir formed behind the huge, now-completed, Tehri Dam. And the roads to the reservoir and the dam are much improved as well, enough to take a German luxury sedan there. The sight was magnificent, and a burgeoning watersports industry has sprung up on the aquamarine waters of the reservoir, but the new car took price of place at a hill overlooking the lake.

And what a nice car it is. Of course, one could argue that being a luxury German sedan, it would be nice any which way. But on many of the recently resurfaced roads of the Garhwal Hills and later on the Char Dham Expressway, the C200 petrol variant I was driving came into its own. Taking the corners while remaining steady as a rock. Sure, if you give it the ‘beans’, as one would say, you could throw it around a corner smoking the tires as you exited, but that is actually not what this car is about.

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A ‘Baby S-Class’

This is the sixth-generation of the Mercedes-Benz C-Class, a brand started by the Stuttgart-based manufacturer to provide an affordable entry into ownership of a Mercedes. After all, for years, in India and across the world, Mercedes-Benz was the car to own if you wanted to show the world you’d made it. Janis Joplin even sang about it (although, much like her friends in the song, she also bought a Porsche). This new one is quite obviously better in every respect mechanically, more dynamic to drive while still consuming less fuel than its predecessors. And it is bigger, in fact the W206, the internal Mercedes-Benz name for this generation of the C-Class, is almost as big as an old E-Class, the car that sits above the C-Class in the Teutonic hierarchy.

And it isn’t just that, Martin Schwenk, CEO, Mercedes-Benz India, points out that in terms of features, this new C-Class is like a ‘Baby S-Class’; the S-Class being the world’s oldest carmakers’ ultimate sedan not surprising since they use the same MRA II platform from the carmaker. And some of the most unique features on this car are all developed not in Germany, but in Whitefield, Bengaluru. Most importantly, the operating system that runs on the large 11.9 inch display called MB.OS (Mercedes-Benz Operating System); and some of the features are really cool. Through the ‘Mercedes Me’ application on your smartphone you can’t just only control all sorts of aspects such as pre-cooling the car, but you can also log-in to the car with just your voice and the it will automatically adjust the car to your personal settings—be it the seats or temperature. But eventually, it will be able to adjust your personal settings across a range of different Mercedes-Benz vehicles.

But it was another point that Schwenk made in a presentation that ought to be highlighted here.

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The inflation pinch, is it?

For years, the luxury car market in India was biased towards the entry-level, but today cars below Rs 40 lakh account for the smallest fraction of sales with those priced above Rs 1 crore being the largest. And that is partially because the cars are not only seeing inflation in terms of size and features but also price.

Vehicles like the C-Class are very nice to drive but they are also highly sophisticated computers on wheels. Which is why prices start at a steep Rs 55 lakh for the petrol C200 model, climbing further to Rs 56 lakh for the diesel C220d and Rs 61 lakh C300d models.

And what is even more surprising is that despite this increase in prices, Mercedes-Benz India is doing better than ever before. In 2021, the carmaker marked a slight recovery from the pandemic, selling 11,242 cars. But in the first quarter of 2022 only, Mercedes-Benz India sold 4,022 cars, keeping it on track for a record-setting pace. In fact, Schwenk believes that if it wasn’t for the semiconductor crisis, the carmaker could sell significantly more. “We have waitlists on most models thanks to the semiconductor crisis, events in China and the global shortage of shipping containers, but our new ‘Retail Of The Future’ sales models gives our customers transparency on delivery times.” If you booked a C-Class today, you’d probably only get delivery by the festive season.

But would one buy something like the Mercedes-Benz C-Class? Yes, when the road was good, the C-Class was a great vehicle to throw around. But there is a good reason that even Mercedes-Benz is increasingly selling more sports-utility vehicles.

The technology onboard the C-Class deserves a deeper dive, but from a sheer practicality point of view, when you’re spending that kind of money, an SUV makes a bit of sense. However, nothing quite beats the presence of pulling up in a Mercedes to a hotel.

@kushanmitra is an automotive journalist based in New Delhi. Views are personal.

(Edited by Anurag Chaubey)

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