Mercedes-Benz India - Comprehensive Analysis Report

Summary

Mercedes-Benz India Pvt. Ltd., established in 1994 as a wholly-owned subsidiary of the Mercedes-Benz Group, pioneered the luxury car market in India. Headquartered in Pune, Maharashtra, the company designs, manufactures, imports, and sells passenger cars, commercial vehicles, and auto components. The company's widespread network extends across 47 Indian cities. Mercedes-Benz India focuses on electrification, digitization, and customer satisfaction while transitioning to software-defined vehicles.

1. Strategic Focus & Objectives

Core Objectives

• Emphasizing the top end of the pyramid, focusing on core luxury rather than entry-level luxury.

• Pursuing electrification and digitization initiatives to stay competitive in the evolving automotive industry.

• Striving for customer satisfaction and operational excellence.

• Transitioning towards software-defined vehicles.

Specialization Areas

• Designing, manufacturing, and selling luxury passenger cars and commercial vehicles.

• Pioneering the luxury car market in India.

• Focusing on technological advancements, particularly in software-defined vehicles.

Target Markets

• Targeting affluent individuals and businesses seeking luxury vehicles.

• Expanding market presence in smaller cities within India.

• Focusing on the top-end and core model segments of the luxury car market.

2. Financial Overview

Funding History

• Total investments in India amount to Rs 3,000 crore as of 2024, inclusive of an additional Rs 200 crore investment planned for 2024.

• In 2023:

• Revenue: ₹10,450 crore (US$1.2 billion)

• Net Income: ₹884 crore (US$100 million)

• Operating revenue range is over INR 500 crore for the financial year ending on March 31, 2024.

• The company anticipates double-digit growth in 2024.

3. Product Pipeline

Key Products/Services

• New Model Launches:

• In 2023, the company launched ten new vehicles in India, focusing on models in the over Rs 1-crore price category.

• Eight new models are planned for launch in 2025.

• Electric Vehicle Expansion:

• The company is expanding its electric vehicle portfolio beyond existing models like the EQC, EQB, EQS 53 AMG, and EQS 580.

4. Technology & Innovation

Technology Stack

• Software-Defined Vehicles: Development and integration of advanced software technologies.

• AI-Powered Manufacturing: Using artificial intelligence to enhance production processes.

• Digital Twin Technology: Creating virtual replicas of vehicles, plants, and processes using MO360.

• Mercedes-Benz Intelligent Cloud: Supporting connected car platforms with real-time data processing.

• MBUX Infotainment System: Integration of ChatGPT for enhanced user experience.

5. Leadership & Management

Executive Team

• Santosh Iyer: Managing Director & CEO. Has been with Mercedes-Benz India since 2009, holding leadership roles in Sales, Marketing, Customer Services, Internal Communications, and CRM. He is the first Indian to hold the position of MD & CEO.

• Emrah Ozer: CFO.

• Krishna Kulkarni: Principal Engineer/ Technical Specialist.

• Shraddha Ukalkar: Chief Information Officer.

Recent Leadership Changes

• Santosh Iyer succeeded Martin Schwenk as Managing Director & CEO on January 1, 2023. Martin Schwenk transitioned to President and CEO of Mercedes-Benz Thailand.

6. Competitive Analysis

Major Competitors

• BMW: A leading luxury automaker with a strong presence in the Indian market.

• Audi: Known for its technologically advanced vehicles and luxury offerings.

• Porsche: Specializes in high-performance sports cars and luxury SUVs.

• Lamborghini: Renowned for its high-end supercars and brand prestige.

• Bugatti: An ultra-luxury car manufacturer known for producing some of the fastest cars in the world.

• Bentley: Caters to the super-luxury segment with handcrafted vehicles and bespoke customization.

• Lexus: Offers luxury vehicles known for reliability and hybrid technology.

• Ferrari: An iconic sports car brand known for its racing heritage and high-performance vehicles.

7. Market Analysis

Market Overview

• The Indian luxury car market has growth potential.

• The luxury car market represents just over 1 percent of total passenger vehicle sales in India.

• The top-end and core model segments are experiencing growth, while the entry-level segment is declining.

8. Strategic Partnerships

• Department for Promotion of Industry and Internal Trade (DPIIT): Collaboration to foster innovation, sustainability, and entrepreneurship in India's startup ecosystem.

• Indian Institute of Science (IISc): Joint research initiatives in sustainable mobility and electric vehicles.

• Birla Institute of Technology and Science (BITS) Pilani: Partnership for advanced technology research.

• Tata Elxsi: Collaboration for vehicle software engineering and software-defined vehicle (SDV) development.

• KPIT Technologies: Partnership to accelerate the development of Software-Defined Vehicles (SDVs).

• ExxonMobil India: Collaboration for the development and supply of synthetic motor oils.

9. Operational Insights

• Mercedes-Benz India is expanding its market share in smaller cities across India.

• The company is focused on enhancing supply chain resilience to support increasing production.

• Transitioning all Indian outlets to the 'Retail of the Future' model.

10. Future Outlook

Strategic Roadmap

• Increasing luxury touch points across India to enhance customer experience and market presence.

• Leveraging India's cost advantages in manufacturing, talent, and innovation to drive efficiencies across the global supply chain.