NEW DELHI, (Reuters) – Mercedes-Benz grew its revenues in India in 2025 thanks to strong demand for its high-end luxury cars, its CEO said, even as stiff competition from rival BMW in the entry-level part of the luxury market pulled down the carmaker’s overall sales in the country.
Mercedes India’s leading luxury carmaker, sold 19,007 vehicles in 2025 versus 19,500 a year earlier, Santosh Iyer told Reuters on Wednesday, reducing its lead against BMW which sold 18,000 cars last year.
A 23% decline in sales of Mercedes’ entry-segment cars in 2025 weighed on growth even as demand for its top-end models grew by 12% and its performance car brand AMG saw a 34% increase over the same period, Iyer said.
“There is a clear price war happening in the entry luxury segment. We have opted out of it and will continue to opt out of it,” Iyer told Reuters.
“We will prefer value over volume,” he said, adding that 2025 was the “best ever year in terms of revenue” with the average selling price of a Mercedes in India touching $111,000, up from $98,500 two years ago.
While Mercedes does not disclose financials for individual markets, according to disclosures made to the Indian government, the carmaker posted its highest-ever revenue of close to $1.5 billion in the last fiscal year ended March 2025, which was up 9%.
With sales of its top-end vehicles – cars priced above 15 million rupees ($166,115) – on the rise throughout 2025, the company expects it will exceed that revenue in the current fiscal year ending March 2026.
India’s luxury car market is small and made up just over 1% of the country’s total passenger car sales of 4.4 million units in 2025.
Mercedes plans to launch 12 new cars in India in 2026, including EVs, AMG and top-end models, Iyer said. He expects single-digit sales volume growth in 2026 as the carmaker fights to reduce costs amid foreign exchange volatility.
“Margins will be under pressure, but still, I think we run a very profitable business,” he said.
Reporting by Aditi Shah;Editing by Elaine Hardcastle
