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Monday, June 17, 2013

Kochi Becomes Hot Turf For BMW, Audi, Mercedes-Benz And JLR

Kochi has emerged as one of the key cities showing burgeoning interest for premium cars, as affluence galore in the south Indian state of Kerala due to a variety of factors including increasing value of spices and rubber along with heavy remittance inflow of foreign exchange money from non-resident citizens.

According to an ET report, the southern Indian city of Kochi has emerged stronger than other metros and cities as the country's strongest growing market for luxury car brands such as BMW, Audi, Mercedes-Benz and the Tatas owned Jaguar Land Rover.
The report attributes an array of reasons for the rising affluence and new found urge to splurge money on luxury cars including the sky-rocketing of spices and rubber both in the domestic as well as overseas markets, coupled with heavy inflow of money from Keralites living abroad, mainly the Middle East and the US.

The daily, quoting luxury car makers, said that Kochi has been logging around 40 percent year on year growth for the last three years, pretty much higher than the rest of the country. What is more, the city now witness sales of more luxury cars than cities including Chennai, Koltaka and Hyerabad.

Quoting Eberhard Kern, Managing Director and CEO of Mercedes-Benz India, the report said that the south Indian state of Kerala had been an important market for the German luxury car maker and had grown about four times in as many years. Furthermore, its brand had gained significant traction in this market, 'as many of our patrons have experienced the fascination of Merces-Benz brand in the Middle East market', Kern pointed out.

And that is not all. Even super luxury cars such as Ferrari and Maserati, which are tad expensive and runs into crores of rupees are making steady inroads into this small state, which is renowned for anti-investment climate, thanks to militant trade unions and a volley of labour strikes.

Ashish Chordia, of the Shreyans Group, which imports super luxury cars including Maserati, Porsche and Ferrari told the daily that over the past few years, the company had witnessed a certain rise in the demand for these cars from Kerala, more particularly from Kochi. Besides the growing metro, even car buffs in smaller cities like the capital city of Thiruvananthauram and the northern port city of Kozhikode, which is engaged in trade of spices and the rubber growing Kottayam too were showing tendency to flaunt luxury cars.

Growth driver

According to the report, the main trigger for this burgeoning demand is Kerala's rising entrepreneur class, along with the wealthy farmers of spices and rubber. While rubber prices had come down to a level playing field from its staggering upward tick of prices back in 2011, nevertheless, the prices remain around Rs 175 a kilogram. In Kerala, the main rubber producing centres include Kottayam, Pathanamthitta and Idukki districts, accounting for around 90 percent of rubber produced in the country.
Natural-RubberThe state is also experiencing a surge in inflows of foreign exchange from those who are working abroad. To top it all, the frequent fall of Indian rupee is also favouring these people to save up lot of money so that they can afford to splurge in various activities. The report pointed that as of 2011, the NRI remittance into Kerala was in excess of Rs 55,000 crore that accounts for more than 22 percent of Kerala's GDP. With the Indian rupee declining against the US dollar, the inflows had been rising steadily in rupee terms, noted the report. Moreover, many entrepreneurs from Kerala, who had established in the Middle East region had started investing in the State. For instance, Lulu Centre that has come up in Kochi.
Michael_Perschke_Audi_R8Michael Perschke, Head, Audi India told the daily that the German premium car major had about 30 percent market share in Kerala. That had inspired the company to widen its footprint with second dealership, which the company would establish in Kozhikode later this year. Audi has recently emerged the top luxury car brand in the country relegating both its compatriots, BMW and Mercedes-Benz and Kerala had contributed in a big way in attaining the pole position in the country, the official added.
BMW_Mobile _Showrrom_ Karnal2BMW, the largest luxury car manufacturer in the world had set up shop in Koch just a year after it forayed into the burgeoning automotive segment in the country back in 2008. The company now has three dealership outlets in Kerala and recently took its travelling Mobile Showroom to Kottayam.
Philipp_von_Sahr_BMWIn March this year, BMW had organised an exclusive driving event at a specially designed track in Kochi, Philipp von Sahr, President of BMW India told the daily. The BMW X1 Drive Experience event premiered the German premium car maker's sporty and luxury products.

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