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Impact of COVID 19 on luxury car manufacturers

A huge change has been noticed amongst buyers as a result of COVID 19 whereby a transformation of the global consumer base is being witnessed. For example, those who would be reluctant to purchase sanitisers and masks are now doing so at any cost. Customers who would enjoy being present at luxury fashion events are now gaining access through live streams on digital platforms. However, on the production side, it is good to see that luxury auto companies Mercedes-Benz India, BMW India and Volvo do not face any impact on production due to the COVID 19.

Many of the luxury car makers have already made contingency plans to prevent disruptions at their plants, with some flying in critical components as well. Mercedes-Benz India achieves production targets with 85% localization of its total sales volumes in the country. Interestingly, its production in China was resumed from 10th February 2020. The company carries out its work with employee safety and welfare as its top priority. It quoted, “For this reason, years ago, we established recommendations and precautions to be followed whenever epidemics or pandemics occur anywhere in the world. This procedure is continuously being adapted, updated and specified. Our procedure is based on the latest advice and information issued by the World Health Organization (WHO) and other institutions.”

Similar to the above, BMW India has secured its supplies till June, as per a media report. The company, however, is studying the impact of COVID 19 on its products to be released after June. 95% of localization in its total sales volume makes it confident of beating the outbreak. On the other hand, Volvo imports vehicle kits from China and Europe, and though it does not see problems in the above markets up to June, it is not 100% sure of the outbreak’s impact on India sales.

Luxury car companies may move to digitization

Apart from the above, most auto manufacturers will clearly understand the importance of digitization. The luxury auto market will also witness a major shift in consumer attitudes wherein they will welcome the idea of selling luxury vehicles online.

Prior to social media, vehicle dealers primarily depended on costly and ostentatious TV advertisements to make their brands popular.  Today, social media is essential for effective advertising in the automobile industry. What’s more, it additionally deciphers that better the vehicle brand does its social media advertising, the higher its odds are of beating the competition. Any car dealer or manufacturer who isn’t using this platform into their business is doing noteworthy harm to their business’ targets.


Currently the entire luxury industry as a whole is witnessing a standstill due to the state and nationwide lockdown. However, luxury brands have witnessed some of their regular counterparts being able to increase sales through e-commerce. From apparel to electronics, telecom to travel, and from food & beverages to entertainment, every industry is looking for ways to tap this niche market which is not only huge but also effectively priced. As a corollary, the automobile industry, including luxury cars, will enter the world of social media to be able to connect with the digitally awakened generation.

Through advanced showcasing strategies, car dealers and manufacturers will have better chances to win their prospects’ attention. Looking at all sectors, it can be rightly said that post COVID -19, the industry as a whole will witness an increase in sales of luxury goods via the e commerce segment as well, thus allowing both luxury and digital platforms to co-exist.