TL;DR
Mercedes-Benz India anticipates that Free Trade Agreements will boost luxury car demand by improving market access and consumer confidence, rather than by significantly lowering prices.
Santosh Iyer, CEO of Mercedes-Benz India, has emphasized that upcoming Free Trade Agreements (FTAs) will serve as a significant catalyst for boosting demand in India's luxury car market. While not expecting dramatic price reductions due to the high localization of Mercedes-Benz vehicles (approximately 95% locally produced), Iyer believes FTAs will primarily expand the market by enhancing consumer confidence and stimulating economic activity.
In 2025, Mercedes-Benz maintained its leadership in the Indian luxury car segment, despite a slight volume decline. The brand's Top-End Vehicle (TEV) segment, encompassing models like the S-Class, Maybach, and AMG variants, grew by 11% and accounted for a quarter of total sales. Furthermore, Battery Electric Vehicle (BEV) sales rose by 12%, with the EQS SUV emerging as a top performer in the luxury electric space.
Iyer's insights highlight a strategic focus on market expansion rather than relying solely on import duty reductions. As India's economy grows and trade ties strengthen, Mercedes-Benz anticipates continued demand for its premium offerings, supported by a diverse portfolio that includes both traditional luxury models and a growing range of electric vehicles.
