Digital transformation of the Luxury Automobile Industry

The global luxury automotive industry is one of the most valuable industries. It is emerging in countries like China, the United States, India, and some parts of Europe. This market is valued at around USD 410 Billion, projected to grow to USD 566 Billion in 2026. The COVID-19 pandemic has profoundly affected the posh car market in the short term because sales and production declined in 2020. A significant increase in the disposable incomes of consumers is propelling the demand for luxury cars around the world. Some of the leading players within the market are Mercedes-Benz, BMW, Lexus, Audi, Volvo, Land Rover, Jaguar, and Tesla. The other players in the market include Ferrari, Lamborghini, and Porsche.

India is a vast vehicle market with tremendous growth potential for luxury cars. However, with the spread of COVID-19, the sales of luxury automobiles were affected, leading to lower footfalls within the showrooms. Various automobile manufacturers were forced to temporarily shut their production because the supply chain was disrupted by the country-wide lockdown imposed by the Indian Government, which restrained the market expansion.

However, the pandemic helped these luxury automobile companies to seek out alternatives and convert their services into digital mode: which helped them to have a contactless experience and be able to serve their customers from the comfort of their homes.

Some notable cases –

➢ BMW launched an online platform, “BMW Contactless Experience,” which was a digital-first purchase experience for the customers. From a dealer’s point of view, it aims to provide all the benefits to the consumers with the utmost comfort level.

➢ Mercedes’ “Merc-from-home” is an ideal online platform through which customers can effortlessly avail themselves of pre-and post-purchase services.

Automobile companies did launch their latest models virtually. Recently, Mercedes-Benz did a virtual launch of the new “C-Class” model on their website and social media platforms. In the media section of their website, they made a separate poster where they mentioned the details of the digital world premiere of the launch of C-Class on 23rd February 2021. Also, Audi A4, BMW 2-Series, Mercedes Benz S-Class, and Lamborghini Huracan Sto were launched digitally.

Due to this very constrained situation, luxury automobile brands had to look for alternate possibilities to digitally service and reach their customers. Therefore, this situation was a blessing in disguise through which the companies learned about many other options and enabled various modes for customer retention and finding new customers.

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