A top executive of luxury car maker Mercedes Benz India has sparked a debate by saying that systematic investment plans (SIPs) are the luxury car brand’s biggest competitors in India. The observation by the sales and marketing head of Mercedes-Benz India, Santosh Iyer, has drawn many reactions on the internet.
“While the luxury car industry is growing at one of its fastest paces post-pandemic, actual sales are a far cry from potential and wealth that India carries,” Santosh Iyer told The Times of India in an interview. Iyer is set to take over as the MD and CEO of Mercedes India operations in January.
Iyer said that if the Rs 50,000 that a potential customer invests in SIP is diverted towards the luxury car market, the business will explode. He also mentioned that he has asked his sales team to look into the issue of SIP investments in order to realise higher growth rates.
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The report instantly drew the attention of mutual fund owners and enthusiasts who mocked the top Mercedes India executive for drawing comparisons between the investment plan and luxury cars.
Nilesh Shah, Managing Director, Kotak AMC, said at Rs 50,000 EMI, it isn’t possible to buy a luxury car but with a SIP of the same amount, for a reasonable time, it may be possible. He said that SIPs create financial freedom for investors to buy anything they want on Twitter.
At Rs 50000 EMI it isn’t possible to buy a Luxury car.
At Rs 50000 SIP for a reasonable time, it is possible to buy a Luxury car.SIPs are creating financial freedom for investors to buy what they want. pic.twitter.com/mEWPGxidvh— Nilesh Shah (@NileshShah68) November 28, 2022
“Humble SIP? Well, it apparently is giving Mercedes some serious competition,” Edelweiss CEO Radhika Gupta tweeted.
Zerodha CEO Nithin Kamath also shared his opinion on Twitter. “A saving mindset is what will help us in times like now,” Kamath wrote. He also mentioned that slow and steady growth is much better than debt-fueled explosive growth.
A saving mindset is what will help us in times like now when countries that have borrowed heavily are getting screwed? In a world of rising interest rates, this will probably get much worse before it gets better for them. 1/2 pic.twitter.com/PhpEu7onS0
— Nithin Kamath (@Nithin0dha) November 28, 2022
A mutual fund enthusiast elaborated on the average SIP amount of most Indians and explained how they can’t possibly compete with the prices of Mercedes. He went on to say, “Either Mercedes is coming up with a Rs 5 lakh car or they don’t know India as yet!”
Cheapest Mercedes in India starts at INR 50 Lacs and comes with an EMI of ~ INR 80,000.
India's avg monthly SIP amount is < INR 3000Either Mercedes is coming with a INR 5 Lac luxury car or they don't know India as yet!source: carwale & cafe mutual pic.twitter.com/XqMgHEcYuO— pj (@BeingPractical) November 28, 2022
Another user called the Merc Exec’s observation unreal and called him out for expecting people to abandon their savings for a luxury car.
(Edited by : Sudarsanan Mani)
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