Some Beasts Are Beautiful

In October 2016, Italian sports car maker Lamborghini’s Huracan Performante set a new record. It covered the 20.6 km Nürburgring track in Germany — one of most challenging and busiest race tracks in the world notoriously famous for setting and breaking speed records of super exotic cars — in just 6 minutes 52.01 seconds. Eleven months later, the previous record holder Porsche’s fastest and most powerful 911 variant, the latest-generation GT2 RS road racer, reclaimed the title by completing the lap in 6 min 47.3 seconds.

These here, are not cars. These are supercars, and nothing quite spells power and wealth like them. So irrespective of who holds the title, these magnificent beasts — which can easily go from 0 to 100 kmph in under 3 seconds — find the pride of place in the stables of millionaires and billionaires around the world.

With its growing tribe of tycoons, the number of super luxury cars — crafted by the best engineers in the world — racing on the streets of India is steadily rising. Even though there are very few highways in the country that can give the thrill of riding these beastly machines, it isn’t stopping buyers from bringing one home.

From classics such as Rolls-Royce or Bentley that are preferred by the likes of  Mukesh Ambani and Amitabh Bachchan among others, to super sports cars from Lamborghini, Porsche or Ferrari that are favoured by young magnates, the Indian rich display a varied taste in luxury driving.

All Eyes On India

The growth of ultra-luxury cars in India is a recent phenomenon that global carmakers are looking to tap into. Luxury vehicles constitute 1.5 per cent of the total passenger vehicles in India, with super luxury cars estimated to be 2-3 per cent of the luxury car market. “There is a huge potential for growth. A key factor in how this growth takes shape will be the evolving regulatory environment combined with the development of infrastructure,” says Pavan Shetty, director of Porsche India. The German carmaker sold 401 units in India last year; it is now eyeing double digit growth in 2017. Lamborghini too is optimistic about the Indian market. Says its India head Sharad Agarwal: “India is one of the strategic markets for our future growth in volumes. In 2012, we decided to invest in the Indian market. We are very optimistic about our future scope in India.” The highly priced luxurious saloon cars from British carmaker Rolls-Royce and Bentley are also finding a good number of buyers in India. “In the Asia-Pacific, India is a strategic market, where we have seen standard growth in the past few years and we have a good future potential here,” Sven J. Ritter, regional sales manager, Rolls-Royce Motor Cars Asia Pacific said last year in an interview with BW Businessworld.

The biggest factor contributing to the growth of this segment is the rapid increase in the number of high net-worth individuals (HNIs) in the country. The number of HNIs in India has risen by nearly 10 per cent over the year. At the end of 2015, India had 200,000 HNIs. In 2016, the number went up by 19,000. Their population is expected to expand further in the years to come and so will their demand for exotic cars.

Another factor contributing to the growth of super luxury cars in India is stable economic policy and taxation structure. Recently, the segment received a sizeable boost from the goods and services tax. Under the new tax structure, road tax is capped at Rs 20 lakh, which essentially means that super-expensive luxury cars won’t be under any liability to pay more than the said amount in tax. Earlier, buyers of such cars had to pay 20 per cent of the ex-showroom price in Mumbai as road tax. Now, cars costing over Rs 5 crore will get cheaper by over Rs 1 crore. Lamborghini has already slashed the price of its Aventador S by a whopping Rs 1.02 crore; the model now costs Rs 5.21 crore. Earlier in the year, due to Brexit referendum, British carmakers Rolls-Royce, Bentley, Aston Martin and Range Rover cut prices in India by between Rs 20 lakh and Rs 1 crore. While all the above mentioned factors will continue to assist the luxury car segment, the sole factor responsible for the growth is the new wave of buyers.

A New Breed Of Buyers

India’s love affair with luxury cars started way back in the early 20th century when Indian Maharajas abandoned their phaeton in favour of the British grandeur of Rolls-Royce. Today, the Maharajas are gone, but Indian elites’ desire for class, style and speed is stronger than ever. So much so, that top global luxury carmakers have opened shops in India to meet the rising demand from the new crop of buyers.

Agarwal of Lamborghini says, “In India, there are primarily two sets of customers; one comprising second generation business families, and a limited number of buyers who are entrepreneurs and have made it large. This second set, of young entrepreneurs, is emerging rapidly in our country. The average age of the Indian buyer is 25-45 years.”

And as much as these young capitalists seek luxury, their foremost specification is to be niche. Says Bojan Jankulovski, head of operations at Maserati India: “A Maserati customer seeks the thrill of belonging to a select tribe, while appreciating the unique opportunity to boast of personal connoisseurship. He is young and doesn’t follow trends. But wants to possess a badge that delivers elegance, style, performance and at the same time is sporty and practical. For our patrons, driving a Maserati is an occasion.”

Among the new breed of luxury car buyers are also women and small town buyers. According to Shetty, female Porsche owners currently represent 7 per cent of Porsche two-door sports car customers in India. For Lamborghini, its first sale to a woman buyer was in 2016; since then, it has registered two to three female buyers. Tier-2 towns such as Surat, Cochin, Lucknow, Bhubaneshwar and Jaipur have emerged as string centres. Recently, the just under Rs 5-crore Aston Martin DB11 was dispatched to Bhubaneswar. If reports are to be believed, the iconic British car will share the garage with Audi R8 LMX and India’s only Lamborghini Aventador SV Coupe.

Tailored Fit

Power of over 600 horses in an engine; Attractive and distinguishing looks; modified interiors with the most expensive leather to suit the mood of the buyer, who in every sense  is not just any ‘other’ buyer, is how a luxury car is put together. “Driving a Maserati is like wearing a tailor-made suit in the world of uniforms. Every single Maserati on the motorway across the world is different from the other, as our customers have the option to configure the exterior and interior look of the car using the Maserati configurator,” says Jankulovski of Maserati India.

In the looks department, these cars come in millions of colour combinations. Lamborghini, for instnce, offers 30,000 combinations of colours and trims, while Rolls-Royce comes in 44,000 different colours. Ritter of Rolls-Royce says, “You can bring us a colour sample, whether it is a piece of cloth, your nail paint, or anything. There is an endless variety of colours available for interiors as well as for the exteriors,” he says adding that even the wood they use for the interiors of the car can also be customised. For instance, if a customer wants a specific wood, may be from their own estate or from a particular tree. “We can build you a one-off car. We have customers who buy a car for up to $7 million,” he says. The waiting period for these modified cars can be anywhere between three and six months. “The cars are hand crafted in our headquarters in Crewe, UK, to suit buyers’ preferences. The level of luxury in Bentayga is unmatched. So it takes a little time to give the final shape to the car,” said Satya Bagla, managing director of Exclusive Motors, during the launch of Bentley’s Rs 3.85-crore SUV Bentayga.

SUVs Join The Race

In the super luxury car market where the two-seater sports car and classy sedans have been the first choice, sports utility vehicles (SUVs) are fast becoming a new favourite among buyers. Not only the growth of SUVs in the passenger car segment in India has been stupendous in the recent years, in the luxury car market too SUVs hold the lion’s share. The frontrunners in the segment are the German trio Audi, BMW, Mercedes Benz. Tata-owned Land Rover and Range Rover are also popular choices among SUV enthusiasts. For Porsche, 70 per cent of its total sales — 401 units in 2016 — came from SUVs, while sports segment and Panamera contributed 20 per cent and 10 per cent, respectively.

Bentley’s first SUV, Bentayga, which is powered by a twin-turbocharged 6.0-litre W12 engine, making it the fastest and the most powerful SUV in the world, is expected to generate good sales volumes for the company. Bagla says, “The pre-booking response of the car is amazing. Our sales are expected to touch three-digit figure by the end of this year.”

Owing to the strong demand and the condition of Indian roads that are best travelled on SUVs, Lamborghini and Maserati too are bringing SUVs to the Indian market. Maserati, which is yet to formally launch its SUV Levante in India, has already found place in a few lucky garages. Reportedly, actor Arjun Kapoor and a Bangalore-based businessman have imported the car before its official launch in India. Expected to be priced between Rs 1.5-2 crore, Levante’s diesel model sprints from 0 to 100 kmph in 6.9 seconds, and has a top speed of 230 kmph.

But among the most awaited is Lamborghini’s new SUV. Agarwal says, “2018 will witness the launch of world’s first super sports SUV Lamborghini Urus in India. Urus will change the dimension of our business in India. It will be an everyday use car that will combine the performance of a super sports car with the versatility of an SUV and will offer a very unique experience to our customers.” Lamborghini aims to double its sales number in the domestic market with the SUV.

Just like by looking at a house can tell who lives in it, a car can tell you who rides it. The size, the speed, the make of a car are the telltale signs of the wealth and status of its owner. Little wonder the elites of the country want their garages to be studded with jewels manufactured by the top luxury carmakers in the world. After all, a car is a matter of pride.  

arshad@businessworld.in

@arshadkhan_BW

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Big Boy Toyz

What would you call a showroom that has a red hot Ferrari next to a swanky Lamborghini that is next to a suave Porsche? A super showroom, perhaps! Big Boy Toyz (BBT), the largest dealer for high-end used cars, is a hotspot for car aficionados in the country.

Started in 2009, the firm has two showrooms in Delhi NCR and a clientele that includes cricketer Virat Kohli who recently exchanged his Lamborghini Gollarado for a Bentley, the billionaire Poonawalas, and the Singhs of Fortis hospital, among others.

Says BBT founder & managing director Jatin Ahuja: “Seventy five per cent of our customers are passionate car lovers who won’t stick to a Ferrari for 10 years. They need change after driving it for a year or two and we provide the best platform for that.” Ahuja claims that 60-70 cars they sell are driven less than 2,000 km. At present, BBT sells close to 75 cars a quarter and is very optimistic about future growth, both in numbers and revenue. It aims to touch Rs 1,000 crore annual mark by 2020 from the current revenue of 225 crore. BBT is coming up with a new showroom in Mumbai in 2018 to help them sell 200 cars a quarter by 2020.

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‘Exclusivity is most integral’

Bojan Jankulovski, Head of Operations, Maserati India

Q: Tell us about Maserati’s journey in India so far?

It has been a successful run so far with the brand’s representation as per its global standards, which is compliance in terms of sales, after sales, service excellence, network infrastructure and a grand representation.

In terms of sales, our focus remains on exclusivity and hence, we will not be selling in dozens. Abiding by that, we are targeting a double digit range in terms of annual sales in India.

Q: What kind of customisation does Maserati offer?

At Maserati, exclusivity is deemed most integral to the whole vehicle experience. We ensure that our customisation indulgence is perfectly tailored to suit a client and his/ her needs. Every single Maserati on the motorway across the world is different from the other, as our customers have the option to configure the exterior and interior look of the car using the Maserati configurator.

Q: What are your future plans for India?

Our immediate plan is the launch of Maserati Levante in Q4 of 2017. Levante is based on the evolution of the sedan platform, designed exclusively by Maserati. Besides our products, we are focused on delivering world-class services to our existing and new customers.

Q: What do you think about the super luxury car market in India?

The luxury car market has been relatively untouched by any negative market sentiment and has been posting a YoY growth. The primary reasons fuelling this growth over the past few years are the super luxury crossovers and SUVs that have been experiencing tremendous boost in sales owing to launch of multiple strategically priced models at various price points coupled with smart financing schemes. Even though super luxury SUV penetration level in India is low, leading luxury car manufacturers, including Maserati, are betting on the market’s potential.

Q: What are the challenges in the super luxury car market in the country?

In terms of finding prospective buyers, India has been warm to us. The challenge lies more at the carmakers’ level, to understand the market they operate in and offer a product line-up based on the needs. There is a dire need to have factors that distinguish a brand among the clutter. For us it’s the exclusivity and craftmanship that does the deal.