Volvo Car’s Indian unit, which only entered the market last year, expects industry sales of luxury cars to rise to about 10,000 this year from about 7,000 last year and to keep growing in double-digits for some years.
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Volvo sold about 90 cars in 2008 and expects sales of its 6 models to rise over 10% in 2009 as it seeks to tap a growing market, local managing director Paul de Voijs said.
“First, there is a huge unsatisfied appetite for luxury cars in the market. Second, most luxury brands are still expanding their dealer network and expanding their portfolio of car lines,” de Voijs told Reuters.
Luxury cars account for 0.5% of total car sales in India but the market’s potential is attracting new entrants. Tata Motors recently launched its Jaguar and Land Rover brands bought from Ford in 2008.
Jaguar prices range from INR6.3m to INR9m (US$128,000 to $183,000) while Volvo stickers range from INR3.8m to about INR5m.
Russia, where luxury cars are about 5% of total sales, is Volvo’s largest market among emerging markets, with sales of about 20,000 cars a year, de Voijs said.
“India has a bigger population and has more dollar millionaires than Russia… I see no reason why (luxury cars) should not go to 2-3% of the market,” he said.
From October, Volvo’s Indian unit will be independent of Ford India, de Voijs added.
