The adoption of electric vehicles in India’s luxury car segment is accelerating faster than in the mass-market passenger vehicle space, with EV penetration reaching as high as 10–12 percent of total sales for some premium brands, according to Mercedes-Benz India. With a growing range of EVs in the luxury space, the industry is expected to sustain electric vehicle adoption levels at around 10 percent going forward.

EV adoption in luxury segment vs mass-market segment

Luxury EV adoption 5x more than mass-market segments

“The acceptance of EVs in the luxury segment is much stronger compared to the mass market. Currently, we have 8 percent EV penetration, and some other luxury brands are at 10-12 percent,” said Santosh Iyer, Managing Director and Chief Executive Officer of Mercedes-Benz India.

Of the 51,000 luxury cars sold in the last financial year at an industry level, nearly 4,500 units were EVs. In contrast, while EV adoption in the mass-market segment is growing, it is still at just around 2–3 percent last fiscal, even with total EV sales reaching approximately 1.2 lakh units.

What’s driving EV adoption in luxury segments?

Greater readiness among luxury EV buyers

Iyer credited the higher penetration in the luxury segment to greater customer readiness. “It’s not just about the numbers—it’s also the kind of EVs being sold. We focus on top-end electric vehicles, while others may offer entry-level EVs. But across the board, acceptance in luxury is stronger.”

While confident in the segment’s upward trajectory, Iyer stopped short of calling it an acceleration, citing a steady build-up in adoption over time. “From 2 percent to 2.5 percent, then 4.5 percent, and now 7–8 percent, we’ve seen consistent growth. Even without a massive portfolio expansion, we expect to sustain this momentum,” he said. “More products entering the segment will drive demand, but even with our current lineup, we’re seeing strong quarter-by-quarter progress.”

Mercedes-Benz India does not plan to significantly expand its EV offerings in the short term but expects organic growth to continue, supported by improved infrastructure and shifting consumer preferences.

Mercedes-Benz India’s EV sales

Strong demand for top-end EVs

In the financial year 2024–25, the German automaker’s EV sales surged by a robust 51 percent. In the March quarter, the locally assembled EQS SUV pushed EV penetration to 8 percent of total sales.

At the higher end of the spectrum, the EQS Maybach Night Series and the electric G-Class have also garnered strong demand. Both models now have a waiting period of up to 12 months.