Mercedes-Benz is set to enhance its footprint in the lower-tier cities of India. To achieve this, the renowned German luxury automobile manufacturer intends to establish 20 new dealerships or service centers by 2025, primarily targeting smaller urban areas throughout the nation. These facilities will focus on attracting young entrepreneurs as potential customers. Currently, the company operates 125 outlets in India, with a significant concentration in major metropolitan areas such as New Delhi and Mumbai.

In 2024, Mercedes-Benz achieved record sales exceeding 19,500 vehicles in India, reflecting a 12 percent increase. The automaker attributed this success to the introduction of new car models and a robust lineup of electric vehicles. Furthermore, sales of electric cars have nearly doubled during the same timeframe. The company plans to unveil eight new models, including electric variants, in 2025 and anticipates surpassing last year's sales figures.

The rapid economic development in India has led to a notable change in the luxury purchasing mindset among younger consumers, contrasting with the more frugal attitudes of previous generations. "The second and third generations are now managing family businesses; they have studied abroad and returned with a willingness to indulge in luxury without hesitation. This trend extends beyond automobiles to include watches and other high-end products," stated Santosh Iyer, CEO of Mercedes-Benz India, in an interview with Reuters.

Iyer further emphasized that the demand for high-end Mercedes-Benz vehicles and electric models surpasses that for entry-level options in smaller cities such as Kanpur, which has a population of approximately 3 million, and Patna, with over 2 million residents. In these locations, the company plans to initiate its expansion with a service center, he noted.

Additionally, Iyer observed that there has been a notable increase in electric vehicle sales in certain smaller cities, as many customers in these areas reside in standalone homes that provide adequate space for charging electric vehicles.

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