Fully focused on EVs, to introduce new products across price points: Mercedes Benz’s Iyer
Iyer says that a stable policy intervention including GST and reduction of road tax for the next 8-10 years is essential to drive in electrification in India
- Jul 9, 2024,
- Updated Jul 9, 2024 6:56 PM IST
As the luxury car segment grows and the penetration of EVs increases, Mercedes Benz India has strategised to remain fully focused on EVs by introducing new products across various price points. “This pace of (EV) transformation is decided by the customer and stakeholders like the government considering taxation and consumer preferences. So for us, the strategy is to remain fully focused on EVs by introducing new products at a very competitive and current price points. On the other side, we will be tactfully flexible, we will also introduce combustion engine cars and then we will wait for the market and the consumer to decide on the rate of transformation,” Iyer tells Business Today. The company launched its globally popular and smallest electric vehicle EQA, which is priced at ₹66 lakh. The company also introduced EQB 350 SUV (5-seater) priced at ₹77.5 lakh and EQB 250+ SUV priced at ₹70.90 lakh. According to Iyer, electrification is a marathon and not a sprint. Notably, while Iyer argues charging infrastructure to be a challenge for electrification, he opines that misconceptions around EVs as a technology are also holding back consumers from buying them. “Also looking sometimes at a certain value of the residual value of EVs, because there is a misconception that EV batteries may last only eight years as long as the warranty period. But the life of an EV is as good as any other combustion engine car. So I think there is yet one full cycle of EVs to be completed, and that is keeping away the traditional car buyer as they are waiting for the transformation to happen,” notes Iyer. Moreover, according to Iyer, as EVs are priced higher as compared to the ICE (internal combustion engine) counterparts, consumers are reluctant to pay a premium. “Till now the customer is still not ready to pay a premium on the purchase price, though the total cost of ownership is much cheaper when you drive an EV,” Iyer notes. From the policy front, Iyer says that a stable policy intervention including GST and reduction of road tax for the next 8-10 years is essential to drive in electrification in India. The company, which currently leads the luxury car segment, will introduce the EQS Maybach SUV by the end of this year. The company reported a 9% increase in sales to 9,262 units in H1 of 2024 as against 8,528 units in H1 of 2023. Of this, the sales of battery EVs grew by 60%, comprising 5% of total sales volume. “For us at Mercedes Benz, we are looking at double digit growth and since we are the largest player in the luxury car market and leading the car market, we feel this trickledown effect should happen also for the entire luxury industry. So, a double digit growth should be possible for the overall luxury market and for Mercedes Benz for sure,” says Iyer.
As the luxury car segment grows and the penetration of EVs increases, Mercedes Benz India has strategised to remain fully focused on EVs by introducing new products across various price points. “This pace of (EV) transformation is decided by the customer and stakeholders like the government considering taxation and consumer preferences. So for us, the strategy is to remain fully focused on EVs by introducing new products at a very competitive and current price points. On the other side, we will be tactfully flexible, we will also introduce combustion engine cars and then we will wait for the market and the consumer to decide on the rate of transformation,” Iyer tells Business Today. The company launched its globally popular and smallest electric vehicle EQA, which is priced at ₹66 lakh. The company also introduced EQB 350 SUV (5-seater) priced at ₹77.5 lakh and EQB 250+ SUV priced at ₹70.90 lakh. According to Iyer, electrification is a marathon and not a sprint. Notably, while Iyer argues charging infrastructure to be a challenge for electrification, he opines that misconceptions around EVs as a technology are also holding back consumers from buying them. “Also looking sometimes at a certain value of the residual value of EVs, because there is a misconception that EV batteries may last only eight years as long as the warranty period. But the life of an EV is as good as any other combustion engine car. So I think there is yet one full cycle of EVs to be completed, and that is keeping away the traditional car buyer as they are waiting for the transformation to happen,” notes Iyer. Moreover, according to Iyer, as EVs are priced higher as compared to the ICE (internal combustion engine) counterparts, consumers are reluctant to pay a premium. “Till now the customer is still not ready to pay a premium on the purchase price, though the total cost of ownership is much cheaper when you drive an EV,” Iyer notes. From the policy front, Iyer says that a stable policy intervention including GST and reduction of road tax for the next 8-10 years is essential to drive in electrification in India. The company, which currently leads the luxury car segment, will introduce the EQS Maybach SUV by the end of this year. The company reported a 9% increase in sales to 9,262 units in H1 of 2024 as against 8,528 units in H1 of 2023. Of this, the sales of battery EVs grew by 60%, comprising 5% of total sales volume. “For us at Mercedes Benz, we are looking at double digit growth and since we are the largest player in the luxury car market and leading the car market, we feel this trickledown effect should happen also for the entire luxury industry. So, a double digit growth should be possible for the overall luxury market and for Mercedes Benz for sure,” says Iyer.