Diesel ban weighs on Mercedes-Benz India’s H1 sales

Luxury carmaker Mercedes-Benz today announced its India sales for the first six months of 2016.

Given the ongoing ban on diesel car sales of over 2,000cc in its key market of Delhi-NCR, its despatches dipped marginally year on year. The Stuttgart-based manufacturer sold 6,597 units in the January-June 2016 period, against 6,659 units sold in the reporting period a year ago.

Roland Folger, managing director and CEO, Mercedes-Benz India, commented: “We are quite satisfied with our overall sales performance in the first six months of the year, despite facing market challenges throughout the first half year. Though sales growth would have been much higher and in double digits had we not lost sales in the important Delhi-NCR and Kerala markets.”

The company said that the strong growth pan-India off-set the challenges in the Delhi NCR market. The product offensive in the form of five new launches this year so far also helped the company’s cause.

The E-class remained the highest selling model for Mercedes-Benz India, while the GLE remained the highest selling SUV. The flagship S-Class and the Mercedes-Maybach S-Class luxury sedans, also continue to see huge demand along with long waiting periods. The newly launched SUVs (GLC, GLS) and the GLE are also witnessing strong demand, the carmaker said.

Commenting on the outlook for the second half of 2016, Folger said: “The second half of the year promises to be extremely exciting, as there is a pent-up demand for our products and we are hoping for a positive decision. We will witness some of the most fascinating product introductions including the ones without a predecessor, rolling-out some industry benchmark service initiatives, further expand our network into new markets, as well as some key growth announcement for Mercedes-Benz. We are keenly looking forward to a long-term policy roadmap for the auto industry, which is a key contributor to India’s GDP and ‘Make in India’ campaign.”

The company’s hopes for a positive decision on the ongoing ban might just come true as the Supreme Court has said that it is open to lifting the ongoing ban, subject to the levy of a one-time environment compensation cess. However, the central government, which has strongly come out against the ban, opposed the imposition of any environment cess and has sought a time of six weeks to conduct a study on impact of diesel vehicles on the environment.

In a bid to tackle the rising levels of pollution in Delhi-NCR, the SC had imposed a ban on the sale of diesel cars and SUVs with engine capacities over 2,000cc in the region, starting mid-December until its expiry on March 31, 2016. However, the apex court extended this ban on diesel passenger vehicles until the next hearing, which took place on April 30, 2016. It then extended the restriction for a second time until its next hearing on May 9, 2016. The court has reserved its verdict on the matter after listening to the pleas of involved parties until the next hearing.

Also read: Mercedes-Benz sells over a million cars globally in first half of 2016, up 12.1%