Luxury EV Adoption Outpaces Mass Market: Mercedes-Benz India
The adoption of electric vehicles in India’s luxury car segment is outstripping growth in the mass-market space, with EV penetration reaching as high as 10–12% for some premium brands, according to Mercedes-Benz India. Luxury EVs are being adopted at a rate five times higher than that of mass-market segments.
“There’s a significantly higher acceptance of EVs in the luxury segment compared to the mass market,” said Santosh Iyer, Managing Director and CEO of Mercedes-Benz India. “Currently, our EV penetration stands at 8%, while some luxury competitors are already in the 10–12% range.”
In FY2024, out of approximately 51,000 luxury vehicles sold industry-wide, around 4,500 were electric. By contrast, the mass-market segment, despite reaching total EV sales of about 1.2 lakh units, has seen adoption rates linger around just 2–3%.
Why Luxury EVs Are Leading the Charge
Iyer attributes this trend to a higher level of customer readiness among luxury buyers. “It’s not just the volume—it’s the type of EVs being sold. We focus on top-end electric vehicles, while others may concentrate on entry-level models. Across the board, we see stronger acceptance in the luxury space.”
While Mercedes-Benz India remains optimistic about the segment’s growth, Iyer characterized it as a steady build-up rather than a sudden surge. “We’ve moved gradually—from 2% to 2.5%, then 4.5%, and now 7–8%. This consistent growth shows strong consumer interest even without a massive expansion of our EV lineup.”
Looking ahead, Mercedes-Benz does not plan a rapid expansion of its EV offerings in the near term, but expects demand to rise organically, driven by growing infrastructure and evolving customer preferences.
Mercedes-Benz India’s EV Performance
The company saw a 51% year-on-year increase in EV sales during FY2024–25. In the March quarter alone, the locally assembled EQS SUV helped EVs account for 8% of Mercedes-Benz India’s total sales.
At the top end, models like the EQS Maybach Night Series and the electric G-Class have been met with particularly strong demand, both commanding waiting periods of up to 12 months.