Q: Congratulations on assuming the charge of the President of FADA. What are your immediate priorities?

Gulati: Thank you!

The past eight to nine months have been a challenging time for the entire humanity and every business sector. It has been a difficult phase for the dealer fraternity too. We have worked in very adverse conditions with zero business and zero earnings, along with a high operational cost. Post reopening of dealerships, proper decontamination and sanitisation of the entire premises, vehicles, employees, etc., have added cost to dealers who were already seeing slow sales for over 18 months in the pre-COVID era.

We are a resilient lot, and COVID has taught us to make tough decisions to ensure that our business and community survive, while offering the best of our services to customers. During my tenure, I will rigorously take up all our dealer issues at every possible platform and offer the association the finest representation, better visibility and hearing, offering a competitive business and operational environment to our fraternity.

The automobile industry has been an important driving force in India’s economic growth. Reviving the automobile industry is vital to regain lost momentum in the economy. The Government and the sector need to work together to strengthen the industry, wherein the dealer fraternity is an important element in the system.

One of the key issues which we will be working upon is improving dealer margins. Over the years, profitability has dwindled due to high costs and low operating margins.

Auto dealerships in India are operating at an average net profit level of 0.5 percent to one percent of the total turnover, which is much lower than the global standard, as internationally, dealer margins range from seven percent to 12 percent on selling price of the vehicle.

We have already written to SIAM about this, and we will further strongly urge all our OEMs to make the dealer business more sustainable and shockproof.

While we were trying to bring auto dealers under the ambit of MSME, we will up the ante further and make sure that dealers are treated at par with other businesses who are reaping the benefits of being an MSME.

Further, as a category, 2-wheelers comprise 75 percent of the sales in India, and I am working to make an exclusive 2-wheeler vertical at FADA.

This will specifically work on the nuances of 2-wheeler dealership such as sub-dealers, brokers etc. The dynamics of 2-wheeler dealers are very different from 4-wheeler dealers and hence need special attention. As they say, fortune is at the bottom of the pyramid!

FADA will continue to take up issues concerning regulatory and legislative burdens, representing the dealer fraternity across every possible platform. We will continue to reach out to our principals and build strong relationships moving ahead.

Q: FADA has been working on increasing dealer margins for ages but ends up in a stalemate. Where is the issue? How are you going to tackle this?

Gulati: Yes, this is one issue which we have been working for many years, but efforts were not made concretely until sometimes back. It’s during the 2nd Auto Retail Conclave, when we brought up the issue to our executive committee, had a panel discussion exclusively on dealer margins. There onwards, we started building momentum with continues efforts in this direction, and a few months back we also did a study on dealer margin offered by individual OEM to their respective dealers across the product lineup. This was an eye-opener for the entire fraternity as nothing of this sort was brought out in the past; this showcased that Indian dealer’s community were working on a minimal margin which was way below the global standards.

I am happy to mention that post this study, few OEMs have reviewed their dealer margin, few are in discussion with their management and respective dealer council. However, the increased margins are still not at a level which we have been asking for, but a movement has started, which is quite encouraging for the entire community.

Dealership business has a significant daily expense which is addressed by the dealer from his marginal profit. A better profit margin will help the dealer to re-invest a subsequent amount of his earning for the development and expansion of his business, which in return will add up a new business to OEMs.

We will continue to do this kind of studies in times to come and also keep negotiating with our principals as they also understand that their first customers are not in good shape and they require higher margins to sustain their business.

Q: What according to you are the skill gaps persist in the automotive industry still and how FADA is addressing this?

Gulati: Skill gap is a subject which is never-ending as technology keep changing, and we need to make a continuous effort to upgrade our manpower. In recent time, the automobile industry has gone a long way in terms of technology upgrade.

To address this change, all the three auto Associations (Automotive Component Manufacturers Association of India (ACMA), Federation of Indian Automobile Dealer Associations (FADA) and Society of Indian Automobile Manufacturers (SIAM)) have come together in tune with National Skill Development Council and created ASDC (Automotive Skill Development Council) which looks to reduce the gap in between yesterday’s skills and today’s requirement. FADA has been making a continues effort to keep our dealership manpower at par with the newer technologies.

At FADA, we are starting up with a FADA Academy which will hold courses for Dealer Principals and their Chief Experience Officers to train them in running an efficient dealership business from all aspects.

Q: With more than 50 percent of the work in purchasing any vehicle done online, where do you see the role of dealers in the future? Do you see the new trend fuelling unemployment further?

Gulati: Getting prospective customers through the online route is a growing trend. Dealers and manufacturers have been active on online platforms for quite a long time now. The pandemic is the reason for this change in consumer behaviour. Earlier, customers had to visit dealerships several times before the final buy. e.g. all loan formalities, document verification, vehicle test drive etc. These are now offered online or at the doorstep. But for the final sale, customers have to visit the dealerships to test the vehicle and take delivery.

Today every customer is well informed. The vehicle-buying experience involves several steps, right from an online search, specific automobile website visits, going through views, reviews, product comparison, collecting information from peers, social media and users and evaluating a brand, product and its services.

Only after doing all these research consumers make their decision. It is not just a transaction for the customer, but more about in getting into a relationship of trust. That is where the dealerships come into play. Every customer wants to experience the vehicle physically before closing the deal. More importantly, they want to meet up face-to-face with the dealer and satisfy themselves before committing to this high-ticket purchase.

I don’t think there is any change in the playbook, but digital has now moved from “Nice to have” to Necessity. In this COVID era, with total lockdown, digital marketing has played a significant role in boosting sales and smooth execution. Every dealership has initiated digital training of its manpower, equipping them to conduct sales coordination through a digital platform. This initiative has further enhanced its sales and service reach. Dealerships must be the most frugal and flexible link across the automobile network.

Dealers and dealerships have always been the face of the brand and will continue to be so. I don’t see any immediate challenge or threat to the dealership business. However, with companies being more aggressive and active on online platforms, this will add on to dealership engagement with the brand and the customers, helping them further to enhance their sales and service reach and experience.

Q: What are the challenges you face with emerging technology trends like vehicle electrification?

Gulati: I don’t see vehicle electrification as a challenge for the dealer fraternity. The dealer community has been one of the most adaptable segments of the automobile ecosystem. We have always strived to keep ourselves at par with the manufacturers, and it’s business requirement, product and services utility. The dealer business is one business which significantly depends on its skilled workforce across the offerings such as sales, aftersales, engineering, etc. With every new product or technology, the dealer in association with its OEM partner makes certain that it initiates rigorous training for its employees so that it can offer the best service to its customers on behalf of the brand.

As far as vehicle electrification is concerned, India is still at a very initial level as electric PVs still have less than 0.25 percent market share. The EV segment requires immense Government support in terms of infrastructure, subsidy, allowance, recognition, etc., to get the segment to grow. I don’t want to comment on the technicalities of the segment and its products and services. Instead, on behalf of the entire dealer fraternity, I would like to assure that as a community we are committed to offering all necessary support and service to the Government for its vision about the EV industry.

Q: Episodes like FIAT & Peugeot (decades ago) and GM & MAN Trucks (in the recent past) etc., exiting the Indian market continues, leading the dealerships to lurch. What kind of safeguard mechanisms can we have to support the dealer community?

Gulati: Setting up a global brand dealership in India is a massive cost which varies from brands to segment, size of the dealership, region, location, etc. On an average setting up a premium 2-wheeler brand dealership cost somewhere around INR8-10 crore whereas setting up a premium 4-wheeler brand requires close to INR 20 - 30 crore. It is not just the setting up of a dealership which is a cost, the operation of a dealership is also a huge which involves day to day operational cost, vehicle stocking, employee salary etc. The dealer bears all this. As you know, the dealership business operates on a very minimal profit margin; any such activity by any brand ends up leading to capital loss along with loss of jobs in the sector. And now the pandemic poses another challenge for the dealer fraternity.

For example, the recent announcement by Harley-Davidson to discontinue its manufacturing and sales operations in India has left its Indian dealers stranded. This will result in the closure of 35 Harley-Davidson dealerships, with an approximate capital loss of INR 110-130 crores, besides also leading to a job loss of around 1,800-2,000 people at dealerships.

This is the fourth instance of automobile companies exiting India in the last three years (since 2017). Earlier, General Motors, MAN Truck and UM Lohia had quit their Indian operations, leaving their dealers in a similar fix. Due to FADA’s strong intervention and the Indian Government’s full-fledged support, General Motors and MAN Trucks had partially compensated their channel partners, but the UML matter remains unresolved till date.

Had there been a Franchise Protection Act in India, brands like these would not have abruptly closed their operations, leaving their channel partners and customers in the lurch.

We are already working on a draft with our legal team and have initiated communication with other retail associations to bring the Franchise law in India, which will support the dealer fraternity in the dire situation of an exit or termination.

We would also request the Government to initiate the law on priority as this law will help level the playing field for large international and domestic automakers and dealers and also help in regulating over-dealerisation.

Q: What kind of support/guidance FADA has given to its members to tide over the current situation triggered by the pandemic?

Gulati: These are unprecedented times. Everybody is making the best efforts to emerge from it in their own way. The auto dealership is one such business which was deeply impacted by COVID-19. The auto dealership is a very marginal profit business, and we do not have large funds like car and component manufacturers have, which makes it more difficult for us to emerge from this difficult time. The industry was already struggling with a 15 to 16-month slowdown, and the lockdown has pushed the entire industry further back.

FADA has provided all possible and necessary help to its dealer members. At the time of the lockdown, FADA wrote a letter to Prime Minister Narendra Modi to apprise him about the dealers’ issues and suggesting dealership survival and demand revival initiatives. Apart from this, FADA wrote a letter to SIAM making them aware of the situation of the dealers, requesting them to review the dealer margin and extend their support so that dealer can survive these difficult times. FADA quite actively worked to protect dealers from the loss on remaining stocks of BS-IV vehicles from the ban on the sale. The association petitioned the Supreme Court to extend the dateline for sale of these vehicles. At the same time, while securing the future of dealers, FADA demanded that car makers increase the dealer margin to five percent PBT and reduce the infrastructure cost by 25 percent.

FADA conducted online training for its dealer brothers, training them to prepare for maximum work with limited resources. (MT)

China’s SAIC Motor-owned British marquee brand MG has unveiled its technology roadmap centred on its next-generation Plug-in Hybrid+ systems, SolidCore battery integration and advanced driver assistance systems (ADAS) at MG Tech Day at its UK headquarters in London.

The automaker unveiled its new Plug-in Hybrid+ system, which features 1.1-litre and 1.5-litre turbocharged petrol engines. The company states that it achieves thermal efficiencies exceeding 42 percent. The powertrain incorporates a hybrid transmission with two technologies: Power Split and Motor Decoupling. The latter isolates the generator during electric driving to improve energy efficiency.

The first model to feature this system will be the MG ZS Plug-in Hybrid+, scheduled for launch in 2027.

MG also confirmed the introduction of its SolidCore battery across future Plug-in Hybrid+ models. This semi-solid-state technology is designed to provide consistent power delivery and range stability across various temperatures and driving conditions. The battery will debut in three upcoming B, C and D-segment SUVs.

Furthermore, MG is refining its driving assistance technologies using data collected from over 1.2 million kilometres of driving across 24 European countries.

The One Touch iAD system for parking is production-ready, supporting scenarios such as kerbside parking, reverse paths of up to 100 metres and exit manoeuvres in tight spaces.

A highway assistance system capable of managing motorway entry, exit and lane changes is scheduled for a late 2027 debut in a new MG SUV. Urban NOA capabilities are planned for 2028.

Lastly, the company is conducting Level 4 Robotaxi trials across Europe, the Middle East and China to support long-term mobility research.

MG company stated that these developments reflect a focus on ‘making advanced technology more accessible, useful and relevant for everyday drivers.’

Stellantis-owned Peugeot and the Strate School of Design have formed a partnership to focus on design and innovation within the automotive sector. Through this collaboration, students will work on projects related to mobility, user experience and technology under the guidance of Peugeot design experts and Strate faculty.

The initiative aims to provide Peugeot with access to student designers while offering students experience in the automotive industry. The projects are intended to act as a laboratory for mobility solutions.

Matthias Hossann, Design Director, Peugeot, said, "This partnership reflects our commitment to bringing academia and industry closer together, in order to foster innovative solutions to the challenges of sustainable mobility. It also enables us to engage with and support young design talents from the earliest stages of their educational journey."

Mike Levy, Head of the Transportation and Mobility Design Department, Strate School of Design, said, "This collaboration provides our students with an exceptional opportunity to confront the realities and ambitions of an industry undergoing profound transformation. By working alongside an internationally renowned automotive design team celebrated for its boldness, they gain first-hand experience of its methodologies, expertise, and high standards. In return, it offers PEUGEOT valuable insight into how this new generation of designers envisions its design practice, its perception of the brand, its relationship with mobility, and the future narratives that shape it."

The partnership is intended to combine academic and industrial perspectives to develop designers for future mobility and vehicle projects.

BMW Group India has surged to the top of the luxury car retail charts in the first half of CY2026, overtaking its closest rival in a significant milestone for the company. The company sold a total of 9,075 vehicles  between January and June 2026, a 17 percent YoY increase.

In an interaction with Motoring Trends, Hardeep Brar, President & CEO, BMW Group India, attributed this success to a potent combination of new product launches and shifting consumer preferences towards electric vehicles amid global fuel price volatility.

“A couple of factors played very well for us. So firstly, we launched 11 new models and second thing, because of the West Asia crisis, an increase in fuel prices, a lot of narrative got shifted towards EVs; a lot of people are preferring to buy EVs versus diesel now,” said Brar.

The company’s aggressive product offensive has been central to its performance. With 11 models already launched in the H1 against the planned 25 product offensive for the year, BMW is capitalising on both traditional and emerging powertrains. Brar expressed strong confidence for the remainder of the year, noting an even more exciting pipeline ahead.

“So that gives us more confidence and EV story is only getting stronger with every passing day. I think we have reached an inflection point; people are really loving the EVs that we are introducing,” he remarked.

BMW’s EV penetration stands at an impressive 26 percent within the luxury segment, significantly ahead of the luxury average of around 14 percent and the broader industry’s 6 percent.

Brar highlighted that removing ‘BMW from the luxury equation drops the segment’s EV share to 8-9 percent, underscoring the brand’s leadership in electrification.’

Responding to the key factors driving EV adoption in the luxury space include near price parity between petrol and electric variants, ranges exceeding 500 km (with next-generation models targeting 800 km), and innovative customer assurances.

“EV customers have a lot of anxiety in terms of residual resale value. So, we have a program where we give an assured buyback to the customer that after three years you will get 60 percent of the value. And that is really playing and that is giving them confidence,” Brar explained.

MINI’s Remarkable Revival

On the other hand, the MINI brand has also delivered exceptional results. After selling approximately 730 units last year, BMW India launched the locally produced Countryman C last month at INR 4.75 million, passing on cost benefits to customers. The response was overwhelming, with 150 units sold in the first month alone.

“We are growing at almost 70 percent for MINI in H1 CY2026 and we want to double the volumes of 730 units last year and are looking at 1,500 units for MINI in CY2026,” Brar stated.

Localisation, Dealer Dynamics and Manufacturing Focus

On localisation, the company maintains an average of 50 percent, slightly higher for internal combustion engine (ICE) models than EVs, with ongoing efforts to deepen content in battery technology as more local players emerge.

Addressing dealer profitability concerns around EVs, which typically require less aftersales maintenance, Brar noted strong upfront margins due to high demand. “Dealer doesn’t lose any money on selling the new car. Whereas petrol and diesel have an oversupply and thus they are able to make far more money on the electric vehicle.”

He confirmed that discounting remains absent on EVs, with waiting periods stretching to three months owing to robust demand.

India’s rising importance in BMW’s global portfolio was a recurring theme. “India is one of the fastest-growing markets for BMW across the globe. This year, India is at No. 1 in terms of growth globally,” Brar said.

The company has moved into the global top 20 markets, prompting increased focus from headquarters.

Going forward, BMW Group India plans to produce 20,000 cars this year, up from 18,000 units last year, with ongoing investments in production lines and AI for efficiency. A significant INR 4 billion investment is earmarked for the retail network across CY2025–2027.

The second half of 2026, will see BMW Group India introduce 14 additional launches, including electric vehicles, sedans and SUVs, maintaining strong momentum.

Sharing his views on the sedan segment, Brar said that it continues to hold a robust 35 percent share of BMW’s sales, far above the industry’s 9-10 percent, reflecting enduring customer preference for the brand’s driving dynamics.

When asked about key challenges and opportunities, Brar outlined a balanced view.  “In terms of headwinds, forex is an issue because it is deteriorating. And with every one rupee deterioration, it impacts our bottom line by 1 percent.” He also flagged the risk of sudden shifts away from diesel potentially creating inventory challenges.

On the flip side, “The accelerating EV transition, rapidly growing demand from Tier-2 and Tier-3 cities, and continuous improvement in brand and customer experience becoming better with every passing day. So that I see as another very, very strong tailwind for us,” concluded Brar.

Despite broader manufacturing sector concerns around labour shortages, BMW reports no significant issues, thanks to proactive AI and automation initiatives.

LUXURY CAR SALES IN INDIA
Brand	H1 CY2026	Change (In %)	Market Share (in %)
BMW Group India	10,043	15%	38%
Mercedes-Benz	9,472	-3%	35%
Land Rover	3,039	-5%	11%
Audi	2,182	3%	8%
Volvo	874	4%	3%
Lexus	759	3%	3%
Porsche	319	-22%	1%
Total	26,688	4%	100%

Data source: Vahan

German luxury brand BMW Group India has reported its highest-ever sales for the first half (H1) of 2026, delivering 9,075 vehicles between January and June, a 17 percent YoY increase.

In Q2 CY2026, the company delivered 4,507 cars, representing 17 percent growth compared to the same period in 2025.

The group maintained a strong position in the luxury electric vehicle (EV) segment, delivering 2,359 EVs during the first half, marking a 78 percent increase, with these EVs now accounting for 26 percent of its total sales.

The company also saw significant demand for long-wheelbase models, which recorded a 24 percent increase and made up 52 percent of total sales. Sports Activity Vehicles (SAVs) contributed 65 percent to total volumes, growing by 35 percent.

On the other hand, MINI recorded 504 deliveries, a 70 percent increase, while BMW Motorrad delivered 2,327 motorcycles during the same period.

Hardeep Singh Brar, President and CEO, BMW Group India, said, “BMW Group India has delivered its highest-ever sales performance in the first half of 2026. We have delivered 9,075 cars, but beyond this impressive number, what we are really focused on is to continue our steady double-digit growth in an otherwise challenging environment. The +17 percent growth is a clear reflection of the deep trust our customers place in our brands. Our decisive hold on electric mobility has solidified BMW Group India as the number one choice in luxury EV segment. With a phenomenal 78 percent growth, every fourth car we sell today is an EV. Furthermore, our customer-centric product strategy continues to pay off, driven by a substantial surge in demand for our executive long wheelbase models and dynamic sports activity vehicles. Building on the thrill of our new launches, we have planned 14 more exciting products across all three brands before year end. We will drive this performance to the next level with a luxury experience that is unparalleled in the segment and matches evolving customer desires. With the commitment of our dedicated team and dealer partners, we are confident of driving the momentum and rewriting success stories for the rest of the year.”

In H1 CY2026, BMW Group India has already launched 11 products and plans 14 additional launches by the end of the year. The company’s retail network currently stands at 100 touchpoints across 40 cities, with plans to open 19 more outlets in 18 cities throughout 2026.