Not able to sell enough cars, need govt support on import duty: Audi India

Audi India boss Balbir Singh Dhillon has said the German luxury carmaker has not been able to sell enough cars in India because most of its models come with a hefty price tag of Rs 1 crore-plus owing to the steep import duty they attract.  

“Till the time we reach a certain threshold (in number of units sold in India), the import duties play a kind of negative role. We are not able to sell enough cars today because most of the cars are above Rs 1 crore,” he said at the India EV Conclave organised by Autocar Professional with various TN government ministries and departments last week in Chennai. 

Audi India currently imports completely built units (CBUs) to sell in India. India currently levies 70% and 110% duty on cars imported as completely built units, depending on the ticket size. 

Dhillon pointed out that they need to import several models into the country to test the market before deciding which model to launch. “For a limited period of time, we need some support on reduction in import duties, which should help us test the market and decide how to go forward. That’s been our request to the government.”  

He added that achieving a certain minimum threshold sales volume is what will help them assess the viability of assembling the cars locally in India, as opposed to importing them as CBUs. Dhillon pointed out that India’s luxury segment sees sales of less than 50,000 cars annually. With so many models being available, the highest per-model sales number is perhaps 2,000 cars in a year, he added.  

Audi India sold a total of more than 4,100 cars in India in 2022. During January-September 2023, it has sold 2,056 units.  

Dhillon’s comments come amidst the government’s efforts to make itself more attractive for global automakers such as Tesla to set up manufacturing facilities in India. 

EVs account for 5% of the company’s total vehicle sales in India. Audi’s global goal is to become an all-electric vehicle maker by 2033.