Italian luxury supercar maker Lamborghini is eyeing one-third of its sales in India to accrue from non-metro cities over the next three years, a top company official said.

This is in line with the trend over the past few years, wherein the contribution of tier-1 and tier-2 cities to Lamborghini India’s sales has increased from mere single digits in 2015 to almost one-fourth of its sales now, Sharad Agarwal, Head, Lamborghini India, told BusinessLine .

The overall luxury supercar segment has also been seeing this trend. The rising aspirations in non-metro cities, the growing number of successful businesses in these cities, as well as the efforts taken by the company to make after-sales services available everywhere have contributed to this, he said.

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Currently, Lamborghini India has outlets in Mumbai, Delhi and Bengaluru.

Covid dampener

Dampened consumer sentiments due to the Covid-19 pandemic have had a huge bearing on the luxury supercar segment as sales in the sector are driven primarily by positive emotions, said Agarwal. In 2020, the luxury supercar segment is expected to decline by around 30 per cent. Luxury supercar makers made a sale of around 265 cars in total in 2019, he said.

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Apart from the pandemic, the initial constraints in supply the sector has faced due to the pandemic-induced lockdowns in Europe — where most of these companies have factories — are the reasons why this decline is expected, he explained.

Agarwal believes that Lamborghini India, which is the market leader in the luxury supercar segment, will do better than the industry though the company, too, is bracing for a decline. In 2019, it sold 52 cars in India.

Fully imported

With the resumption of economic activities in India, demand for the sector has also resumed, he said. Orders that Lamborghini India has received in the last three months have almost reached pre-Covid levels, and it has also started delivering cars.

The company’s cars typically attract a waiting period of 4-8 months, and they are fully imported from Lamborghini’s only factory in Italy. While the supply constraints posed by the pandemic-induced lockdowns in Italy had caused disruptions earlier, the company is coming back to the normal supply time line. “We had challenges in deliveries planned for Q2 and Q3 because our factory in Italy was closed for seven weeks, but now our production is getting aligned and for the new orders that we are getting, we have a minimum waiting period of six months.”

The luxury supercar segment in India hasn’t grown to its full potential due to factors like high taxation, inconsistencies in taxation and high import tariffs, he said. “Even if you take the best of the (sales) figure of 325 (units) which was there in 2018 (in the luxury supercar market), for the size of our country and the number of billionaires that we have, this segment does not represent the right demand,” said Agarwal. Apart from taxation, infrastructure challenges and congestion in cities are also impacting the growth in the segment, he said.

On the support that the government can extend, Agarwal said that there needs to be a separate approach for the luxury supercar segment, which is different from that for the mass market car segment.

India potential

Asked about the government’s clarion call for ‘Atmanirbhar’ Bharat, Agarwal said the small size of the luxury supercar market in India does not make any kind of localisation viable. Moreover, most of the luxury supercar brands have factories in only one country, which is mostly the country of origin, he pointed out.

Despite all these factors, for Lamborghini, India is one of the strategic markets for business, said Agarwal. “We are trying to bring our new models much faster to the market which is showcasing how strategic India is in our approach. Second, we are consistently investing in the market to create unique bespoke experiences for our customers.”

Globally, India contributes less than 1 per cent to its volumes. “But we have always believed that India has huge potential for growth in the future and that’s why Lamborghini has been consistently investing in the market,” he said.

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