India's Luxury Car Market May Reach 5% Share by 2030: BMW India

The share of luxury cars in India’s passenger vehicle market could double in the next 3-4 years to 5% on the back of rising income levels, premiumisation trends, higher vehicle prices, and a growing number of models priced above ₹40 lakh, according to BMW Group India President and CEO Hardeep Singh Brar.

The segment currently accounts for roughly 2–2.5% of the overall market when defined as vehicles priced at ₹40 lakh and above, he said. With rising income levels, structural changes in consumer preferences are likely to expand the addressable base for premium vehicles over the next few years.

“I clearly see this going to about 5% by 2030,” Brar said. According to him, the definition of luxury in India is evolving beyond traditional premium brands as vehicle prices rise across segments and more customers upgrade to higher-value models.

He added that the broader passenger vehicle market has steadily moved up the value chain over the years, with buyers gradually transitioning into higher price categories as incomes grow and financing options improve.

“Every 2 to 3 years, you see a jump into the next ₹5 lakh category,” he said, pointing to a consistent trend of consumers upgrading to more expensive vehicles. He added that the pipeline of new models in the ₹40 lakh-plus range is expected to expand significantly, further supporting growth in the segment.

Meanwhile, Brar noted that electric vehicle penetration in the luxury car segment is around 10%, significantly higher than the roughly 4% penetration in the overall passenger vehicle market, underscoring faster adoption among premium buyers.

One of the reasons that helped BMW Group India report strong growth in its January-March sales, despite the West Asia war weighing on luxury car industry demand, is its strong EV play. Electric vehicles now account for 26% of BMW’s car sales.

“Because of this oil crisis and a lot of negativity around oil… a lot of customers have started feeling that EV is the right way to move forward,” he added.