The India luxury car market attained a value of USD 1.29 Billion in 2024 and is projected to expand at a CAGR of 7.40% through 2034. Rising investments in local manufacturing, expanding wealthy population and government policies are propelling the market to achieve USD 2.63 Billion by 2034.
The expanding upper-middle class and growing number of high net-worth individuals (HNIs) are favoring the luxury car demand in India. Luxury vehicles are increasingly seen as symbols of status, success, and lifestyle enhancement. By the end of 2024, there will be over 850,000 HNIs in India, and forecasts estimate that this number will reach 1.65 million by 2027. The desire for affluence brands and specifiers across both segments, have encouraged luxury brands are starting to offer vehicles for India, and for a vehicle segment global automakers to reach beyond urban markets. As a result in 2023, India's luxury car market achieved a record high, selling 42,700 units, a 20% year-on-year increase. This surge reflects a growing appetite for exclusivity and luxury among India's affluent consumers. At the same time, BMW Group India achieved its highest-ever annual car deliveries in 2024, with 15,721 units sold, marking an 11% growth. The company also reported its highest-ever sales of luxury-class models, with nearly every fifth car sold being a top-of-the-range model.
In an attempt to drive more affordability to luxury cars, global brands have invested in local assembly and manufacture of vehicles in India to reduce luxury car import duties and price these vehicles competitively. For example, Mercedes-Benz India has been localizing production by assembling models like the CLA, GLA, and S-Class at its Chakan facility. This move has led to price reductions of ₹1 to 2 lakh per unit, making these models more accessible to Indian consumers. Additionally, the company has adapted vehicle specifications to suit local conditions, enhancing performance and comfort for Indian buyers.
This approach also allows brands to modify the vehicle specifications in the context of Indian roads and the climate, while also capturing the improved local affordability for Indian buyers. Furthermore, the opportunity to localize supports integration into Indian "Make in India" initiatives, but also improved local after-sales service matrix, which also greatly supports the overall development of the luxury car market in India.
Base Year
Historical Period
Forecast Period
Compound Annual Growth Rate
7.4%
Value in USD Billion
2025-2034
*this image is indicative*
|
India Luxury Car Market Report Summary |
Description |
Value |
|
Base Year |
USD Billion |
2024 |
|
Historical Period |
USD Billion |
2018-2024 |
|
Forecast Period |
USD Billion |
2025-2034 |
|
Market Size 2024 |
USD Billion |
1.29 |
|
Market Size 2034 |
USD Billion |
2.63 |
|
CAGR 2018-2024 |
Percentage |
XX% |
|
CAGR 2025-2034 |
Percentage |
7.40% |
|
CAGR 2025-2034 - Market by Region |
South India |
8.1% |
|
CAGR 2025-2034 - Market by Region |
East India |
7.8% |
|
CAGR 2025-2034 - Market by Vehicle Type |
SUV |
8.4% |
|
CAGR 2025-2034 - Market by Drive Type |
IC Engine |
8.2% |
|
2024 Market Share by Region |
South India |
32.7% |
Government policy and green consciousness are propelling the India luxury cars market share. Premium EV models have been launched by brands, catering to a niche but emerging customer base of eco-conscious and innovative buyers. For example, VinFast introduced its high-end electric SUVs in India in September 2025, marking its foray into the expanding Indian EV market. Aspiring Indian consumers are also showing an elevated global awareness of EV trends, leading to early uptake.
Indian premium car buyers anticipate top-shelf technology, such as AI-infused infotainment, voice command, autonomous driving assistance, and real-time vehicle tracking. Brands fight back by incorporating advanced driver-assistance systems (ADAS), augmented reality displays, gesture control, and connected car technologies. In May 2023, Volvo introduced the XC90 Recharge plug-in hybrid SUV in India, featuring Pilot Assist semi-autonomous driving, AI-driven infotainment, and smartphone integration.
Government policies toward electric vehicles, emission regulations, and import taxes have a major influence on the India luxury car market outlook. Reductions in GST on EVs, FAME incentives, and lenient rules on imported EVs are persuading international brands to introduce new models in India. Stringent emissions regulations like BS6 compel engine upgrades and cleaner tech introduction by automakers. Policies supporting local production and green mobility compliment luxury brands' worldwide sustainability agendas. For example, Mercedes-Benz India commenced local assembly of its flagship EV, the EQS 580, at its Chakan facility in October 2022. This move aligns with the government's policy to boost domestic EV production and reduce import duties.
Indian luxury car manufacturers are increasingly providing flexible ownership models in the form of easy EMIs, leasing schemes, and subscription models. Lexus India introduced the Smart Ownership Plan in August 2025, providing flexible, affordable luxury car ownership as per customer requirements. These programs reduce the barrier to entry for prospective buyers who want to own a high-end car but do not wish to make long-term commitments. Subscription services also provide convenience, maintenance protection, and options for upgrading cars from time to time.
Sustainability is now a key strategy for the India luxury cars industry. Brands are committed to cleaner production processes, carbon-neutral buildings, and recyclable components. Volvo, for example, is aimed at becoming an all-electric car brand by 2030 and encourage environmentally friendly interiors in its vehicles. Other luxury brands are likewise conforming to international ESG norms and consumer values for moral production. Indian consumers, particularly younger high-net-worth consumers, care more about environmental footprints.
The EMR’s report titled “India Luxury Car Market Report and Forecast 2025-2034” offers a detailed analysis of the market based on the following segments:
Market Breakup by Vehicle Type
Key Insight: SUVs dominate the market, driven by growing demand for versatility, space, and commanding road presence. Luxury SUVs from brands like Range Rover, BMW, and Mercedes-Benz appeal to families and executives seeking comfort and off-road capability. In October 2025, Nissan introduced a new midsize SUV in India. The segment benefits from India’s diverse terrain and consumers’ preference for spacious vehicles with advanced safety features.
Market Breakup by Propulsion Type
Key Insight: The internal combustion engine (ICE) segment remains the most dominant in the India luxury car market. Traditional luxury vehicles powered by petrol or diesel engines continue to attract affluent buyers due to their established performance, extensive fueling infrastructure, and broader model availability. Brands like Mercedes-Benz, BMW, Audi, and Jaguar offer a wide range of ICE luxury cars appealing to consumers who prioritize power, driving experience, and brand legacy.
Market Breakup by Region
Key Insight: North India is the dominant segment in the India luxury car market, driven by metropolitan cities like Delhi, Gurgaon, and Chandigarh. High disposable incomes, rapid urbanization, and a growing affluent population contribute to strong demand. As per World Population Review, Delhi's 2025 population was estimated at 34,665,600. Key players like Mercedes-Benz, BMW, Audi, and Jaguar Land Rover have established flagship showrooms and service centers across the city, particularly in affluent areas such as Lutyens' Delhi, Vasant Vihar, and Saket. Additionally, platforms like Fusion Cars and Car Street cater to the growing demand for pre-owned luxury vehicles, offering a wide range of options to consumers. The city's extensive luxury car dealerships and service networks enhance accessibility, making premium vehicles more attainable for Delhi's affluent populace. Thus, the region boasts extensive luxury car dealerships and service networks, enhancing accessibility. Additionally, corporate hubs and government officials frequently opt for premium vehicles, further boosting sales.
|
CAGR 2025-2034 - Market by |
Region |
|
South India |
8.1% |
|
East India |
7.8% |
|
West India |
XX% |
|
North India |
XX% |
By vehicle type, hatchbacks dominate the market via premium features
In the India luxury car market, hatchbacks are taking up the dominant segment share since it is compact and has a lower number of premium features. Luxury hatchbacks target urban customers looking for a combination of style, efficiency, and premium brand in a smaller package. In May 2025, Tata Motors launched the All New Altroz premium hatchback with advanced styling, safety features and multiple powertrains. This segment is limited by a customer's preference for more space and a larger vehicle.
Sedans are another significant segment, as customers favor an elegant design, comfort elements, and prestige. The true premium sedan offering from Mercedes-Benz, BMW and Audi are extremely popular, particularly among corporate expatriates and people of considerable affluence. The sedans are symbolic of wealth, impressive cars with advanced features, cushioned rides, and impressive performance. Sedans continue to dominate in metropolitan areas, particularly in markets with well surfaced roads. Sedans remain desirable among people who are interested in luxury-class automobile brands, sophistication and spacious interiors in a conventional four-door form factor.
Electric Vehicles Dominate the Market Via Innovations
Electric vehicles (EVs) represent a rapidly growing in the India luxury car market. Increasing environmental awareness, government incentives, and expanding charging infrastructure are driving demand for luxury EVs from several brands. In June 2025, Tata Motors launched the Harrier.ev, a premium electric SUV built on the acti.ev+ platform. The vehicle offers robust performance, advanced features, and a refined design, catering to the growing demand for luxury electric vehicles in India’s premium automotive segment.
The Internal Combustion Engine (ICE) propulsion segment in India’s luxury car market is driven by strong consumer confidence in proven engine technology, superior performance, and the widespread availability of fueling and servicing infrastructure. Many premium buyers still value the refinement and reliability of ICE vehicles over newer alternatives. For instance, Mercedes-Benz launched the 2024 GLS facelift in India with 3.0-litre six-cylinder petrol and diesel engines, reinforcing continued demand for high-performance ICE models.
South India Leads the Luxury Car Demand with Growing Wealthy Populace
The southern region of India constitutes a significant portion of the market, with Bangalore, Chennai, and Hyderabad being the main demand drivers. The region's rapid IT and industrial development has led to an increasing wealthy customer segment seeking premium cars. For example, the Rolls-Royce Spectre was launched in Chennai in January 2024, marking the brand's first fully electric car in Southern India. Dealerships and after-sales service are also driving growth of the India luxury car market.
West India has a modest share of the market, with Mumbai and Pune as key contributors - Mumbai as the financial hub has a large population of high-net-worth individuals who seek luxury cars. The market characteristically has a focus on exclusivity and customer personalization. The luxury car market in West India competes with the used luxury auto sector but is supported by increasing urban wealth and consumers with lifestyles seeking out premium brand experiences.
Leading players in the India luxury car market are applying tactical approaches in order to gain and grow their consumers in a burgeoning economy. Local assembly and manufacturing can mitigate import duties and, therefore, make the luxury vehicles more price comparable. Growth into Tier-2 and Tier-3 cities is of clear importance, as increased disposable income and aspirations stimulate demand beyond metropolitan areas. Digital transformation is further encouraging brands to invest in online booking platforms, virtual showrooms, and AI-enabled customer engagement via digital promotion to improve the purchasing experience.
With electrification, major players have been bringing electric and hybrid vehicles to market to align with global sustainability goals and take advantage of the government's EV incentives. The push to develop brand loyalty leads companies to promote personalized service, including bespoke customization, exclusive ownership programs, and enhanced quality of after sale service. Flexible payment options are likely also important to create accessibility to luxury. Lastly, brands employ experiential marketing to create emotional connections and elevate brand stature and property status while building a brand presence and reaffirming position in India's luxury automobile sector.
Established in 1926 and located in Stuttgart, Germany, Mercedes-Benz AG has been at the forefront of advancing safety, performance, and luxury. The company has contributed to the automotive industry with significant milestones, including the creation of the airbag, and antiquated Antilock Braking System.
Established in 1916 and located in Munich, Germany, BMW Group is known for the driving experience and premium engineering. Their contributions include the Efficient Dynamics system for better fuel efficiency, and electrification of vehicles through the i-series.
Audi AG, located in Ingolstadt, Germany, was established in 1909. Audi is focused on digitalization and electrification, launching their significant e-tron series which is a notable step toward electric vehicle advancement. Audi is advancing into the future of automotive mobility as they work to evolve the segment with leading driver-assist technologies.
Founded in 1927 and located in Gothenburg, Sweden, Volvo Car AB is known for its commitment to safety and Scandinavian design. Significant innovations in safety include the three-point seatbelt and advanced crash safety systems. Volvo is transitioning to an electric future, pledging to be a fully electric car brand by 2030.
*Please note that this is only a partial list; the complete list of key players is available in the full report. Additionally, the list of key players can be customized to better suit your needs.*
Other key players in the India luxury car market report include Ferrari India, Jaguar Land Rover Automotive PLC, Rolls-Royce Motor Cars India, Bentley Motors Limited and others.
Unlock the latest insights with our India luxury car market trends 2025 report. Discover regional growth patterns, consumer preferences, and key industry players. Stay ahead of competition with trusted data and expert analysis. Download your free sample report today and drive informed decisions in India’s dynamic premium car market.
Upto 15% Off
USD
$2499 $2249
$3999 $3599
$4999 $4249
$5999 $5099
*While we strive to always give you current and accurate information, the numbers depicted on the website are indicative and may differ from the actual numbers in the main report. At Expert Market Research, we aim to bring you the latest insights and trends in the market. Using our analyses and forecasts, stakeholders can understand the market dynamics, navigate challenges, and capitalize on opportunities to make data-driven strategic decisions.*
Get in touch with us for a customized solution tailored to your unique requirements and save upto 35%!
In 2024, the market reached an approximate value of USD 1.29 Billion.
The market is projected to grow at a CAGR of 7.40% between 2025 and 2034.
The key players in the market include Mercedes-Benz AG, BMW Group, Audi AG, Volvo Car AB, Ferrari India, Jaguar Land Rover Automotive PLC, Rolls-Royce Motor Cars India, Bentley Motors Limited and others.
The SUV segment is expected to grow at 8.4% CAGR through 2034.
Key strategies driving the market include localized manufacturing, competitive pricing, expanded dealership networks, digital retailing, electric vehicle launches, and personalized customer experiences. Brands focus on tier-2 cities, finance options, after-sales services, and sustainability. Collaborations and brand experiences also enhance market penetration and customer loyalty in a growing affluent segment.
Explore our key highlights of the report and gain a concise overview of key findings, trends, and actionable insights that will empower your strategic decisions.
| REPORT FEATURES | DETAILS |
| Base Year | 2024 |
| Historical Period | 2018-2024 |
| Forecast Period | 2025-2034 |
| Scope of the Report |
Historical and Forecast Trends, Industry Drivers and Constraints, Historical and Forecast Market Analysis by Segment:
|
| Breakup by Vehicle Type |
|
| Breakup by Propulsion Type |
|
| Breakup by Region |
|
| Market Dynamics |
|
| Competitive Landscape |
|
| Companies Covered |
|
Datasheet
One User
USD 2,499
USD 2,249
tax inclusive*
Single User License
One User
USD 3,999
USD 3,599
tax inclusive*
Five User License
Five User
USD 4,999
USD 4,249
tax inclusive*
Corporate License
Unlimited Users
USD 5,999
USD 5,099
tax inclusive*
*Please note that the prices mentioned below are starting prices for each bundle type. Kindly contact our team for further details.*
Flash Bundle
Small Business Bundle
Growth Bundle
Enterprise Bundle
*Please note that the prices mentioned below are starting prices for each bundle type. Kindly contact our team for further details.*
Flash Bundle
Number of Reports: 3
20%
tax inclusive*
Small Business Bundle
Number of Reports: 5
25%
tax inclusive*
Growth Bundle
Number of Reports: 8
30%
tax inclusive*
Enterprise Bundle
Number of Reports: 10
35%
tax inclusive*
How To Order
Select License Type
Choose the right license for your needs and access rights.
Click on ‘Buy Now’
Add the report to your cart with one click and proceed to register.
Select Mode of Payment
Choose a payment option for a secure checkout. You will be redirected accordingly.
Gain insights to stay ahead and seize opportunities.
Get insights & trends for a competitive edge.
Track prices with detailed trend reports.
Analyse trade data for supply chain insights.
Leverage cost reports for smart savings
Enhance supply chain with partnerships.
Connect For More Information
Our expert team of analysts will offer full support and resolve any queries regarding the report, before and after the purchase.
Our expert team of analysts will offer full support and resolve any queries regarding the report, before and after the purchase.
We employ meticulous research methods, blending advanced analytics and expert insights to deliver accurate, actionable industry intelligence, staying ahead of competitors.
Our skilled analysts offer unparalleled competitive advantage with detailed insights on current and emerging markets, ensuring your strategic edge.
We offer an in-depth yet simplified presentation of industry insights and analysis to meet your specific requirements effectively.
Share