India’s largest luxury car maker Mercedes-Benz India Pvt. Ltd has called for tax breaks for the automobile industry to build a sustainable business model for electric vehicles in the country.
According to Livemint, managing director and chief executive Roland Folger said his company would like to manufacture electric vehicles in India once it crosses sales of more than 400 such units a year in India. Mercedes boasts of being India’s only luxury vehicle maker with more than 60 percent localisation.
A critic of the present government’s “arbitrary” tax policy on the luxury segment, Folger also called for tax breaks on EVs imported through the CBU (completely built unit) route to make for a “sustainable business case”.
If the maker of the E-Class sedan chooses to import EVs into the country, the cars will belong to the parent Mercedes-Benz’s EQ brand, which was unveiled at the Paris Motor Show in October 2016. At present, the parent company is developing nine electric cars for the global markets, Folger added. The German company is also waiting for a stable government stance on taxation of hybrid vehicles “though plug-in hybrids are a meaningful alternative to EVs”. Globally, the cost of EVs must come down to be able to import them, he added.
Meanwhile, Folger admitted that sales for 2017 “did not see a negative surprise though they could have been better if not for the cess hike in September”. From January to September, Mercedes-Benz India sold 11,869 units, a 19.59 percent jump over the corresponding period in 2016.
Separately, speaking on the sidelines of a dealership inauguration in the Thane district of Maharashtra, Folger said a distribution network expansion is on the cards as the company has decided on a few tier-2 and tier-3 cities to expand its reach, without mentioning specifics.
At present, Mercedes has 92 dealerships in 45 cities.
For 2018, Folger expects Mercedes-Benz India and the luxury car segment in India to grow by the double digits “save for external events”, on the back of higher disposable incomes and newer players such as Kia Motors and Genesis entering the market.
