In a closely watched shift in India’s luxury car market, BMW India has edged past Mercedes-Benz India in quarterly registrations for Q1CY26, even as overall demand at the top end of the passenger vehicle segment remained largely flat.
According to VAHAN data, BMW India registered 4,944 units between January and March 2026, posting an 11% year-on-year growth. Mercedes-Benz India followed closely with 4,863 units, with volumes holding nearly steady compared to the same period last year.
The broader luxury car segment saw negligible movement. Total registrations stood at 13,336 units in Q1CY26, almost unchanged from 13,322 units a year ago. The numbers point to a clear plateau in demand, after strong post-pandemic momentum seen between 2022 and 2024.
Momentum vs stability
BMW’s lead, though marginal, builds on its strong 2025 performance, when it clocked its highest-ever annual sales of 18,001 units. The company entered 2026 with a wider product portfolio, aggressive financing options, and a sharper push in electric mobility.
Mercedes-Benz, on the other hand, continues to rely on its established brand pull and strong dealer network. While it retained its leadership in FY26 with 18,160 units—about 859 units ahead of BMW Group India’s 17,301 units—the narrowing gap in quarterly numbers signals rising competition.
Tier-2 cities and first-time luxury buyers drive demand
A key shift in the market is the rise of demand from non-metro cities. BMW has expanded deeper into Tier-2 and emerging markets, where a new segment of affluent buyers is entering the luxury category. Industry data suggests that nearly 35–40% of luxury car demand now comes from beyond the top eight metros, up from around 25% five years ago.
Lower entry price points, flexible financing, and leasing options are making luxury cars more accessible, especially to younger entrepreneurs and professionals.
EV push tilts in BMW’s favour
The biggest gap between the two rivals is visible in the electric segment. BMW registered around 1,033 EVs in Q1CY26, accounting for a significant share of total luxury EV sales. In comparison, Mercedes-Benz reported about 300 EV registrations during the same period.
Overall, luxury EV registrations reached 1,484 units in the quarter, marking a 21% year-on-year increase. While EV adoption in the luxury segment is still evolving, early movers are gaining a clear advantage.
Globally, both brands are accelerating their electric strategies. BMW plans to have EVs contribute 25% of its total sales worldwide by 2026, while Mercedes-Benz Group is pushing towards an all-electric portfolio in key markets by the end of the decade.
Monthly trend shows steady performance
BMW maintained consistent traction through the quarter, registering 2,040 units in January, 1,284 in February, and 1,620 in March. Mercedes-Benz reported 1,821 units in January, followed by 1,368 in February and 1,348 in March.
Other luxury brands, including Jaguar Land Rover, Volvo Cars, and Porsche, continue to hold a smaller share of the market, keeping the segment largely a two-player race at the top.
What lies ahead
The Q1 numbers may not define the full-year trend, but they highlight a changing market dynamic. Growth is no longer driven purely by brand value. Product mix, EV readiness, and expansion beyond metros are shaping the next phase of competition.
With demand stabilising and new buyers entering the segment, the race between BMW and Mercedes-Benz is likely to remain tight through 2026.