The landscape of India’s luxury car market is undergoing a profound shift as younger buyers enter the scene. The data reveals that luxury car buyers in India are now predominantly younger, with two out of five Audi buyers being under the age of 40. Mercedes-Benz India boasts an average buyer age of just 38, the youngest among all global markets for the German luxury automaker. A similar trend can be observed at BMW India, where consumers aged 35 to 40 make up a significant portion of the sales.
According to senior executives in the auto industry, this shift can be attributed to the “YOLO” (You Only Live Once) attitude that has gained momentum in the wake of the pandemic. Young professionals, including doctors, lawyers, chartered accountants, and startup entrepreneurs, have become a dominant force in the luxury car market, challenging the traditional dominance of business families.
A significant transformation can be observed in the corporate sector as well. BMW India, for instance, has seen a notable shift, with corporate professionals making up as much as a third of all luxury vehicle buyers, a considerable increase from just a few years ago. BMW Group India president Vikram Pawah notes that the share of corporate buyers has been steadily increasing, particularly in sectors like startups. He mentioned, “Today, one out of every three vehicles sold is to the corporate sector. This was about 25% in CY2022.”
Mercedes-Benz has also experienced a doubling of sales to corporate consumers, now accounting for 15% of sales since 2021. The robust financial health of corporate professionals, substantial payouts from employee stock ownership plans (ESOPs), and the sustained post-pandemic economic recovery have contributed to this trend. Mercedes-Benz India managing director Santosh Iyer states, “The luxury car segment in India is evolving quickly.” He added, “More young people, especially in the category of startup owners and young salaried professionals, are eager to experience luxury at an early age. They have both the desire and means for it with increasing disposable income.” Notably, around 40% of Audi India’s sales are attributed to buyers below the age of 40.
The surge in luxury car sales in India is also being propelled by rising disposable incomes. It is anticipated that sales will increase by over 20% to reach a record 45,000 units by the end of this calendar year.
Naveen Soni, president of Lexus India, emphasizes that the corporate sector now offers higher starting salaries, and the younger workforce is more aspirational. He noted that the age of the typical Lexus buyer in India has decreased by 3-4 years in the past two years. Despite the higher price tag of Lexus vehicles compared to their German counterparts, which start at Rs 63.10 lakh (ex-showroom), the shift in demographics is reshaping the luxury car market.
While business communities still contribute significantly to luxury car sales, Mercedes-Benz’s Santosh Iyer points out that the customer mix is changing, leading to a decrease in the average age of luxury car buyers. More individuals in the 25-35 age group are now purchasing luxury vehicles, particularly salaried professionals and small and medium-sized enterprises (MSMEs). The shift in buyer demographics has brought the average age of luxury car buyers down to 38.