FEBRUARY 20249TOP STORIESMERCEDES LOOKING AT UNCONVENTIONAL AREAS FOR EXPANSION IN INDIACENTRAL GOVERNMENT SLASHES JET FUEL PRICES BY RS.1,221 PER KL AHEAD OF UNION BUDGETMercedes-Benz, the German carmaker, is aiming to increase its market share in smaller cities in India, where the demand for luxury cars is expected to grow in the upcoming years. Recently, the company launched new GLA and AMG GLE 53 models and now plans to improve its sales and service infrastructure in non-metro areas to cater to the needs of its customers.According to Santosh Iyer, the Managing Director & CEO of Mercedes-Benz India, there is significant growth happening in mini-metros in India, and the company wants to increase its customer base in these cities. To achieve this objective, the firm will be opening up 20 new workshops in 10 new cities, including Jammu, Kanpur, and Patna.The company aims to ensure that customers in these mini-metros don't have to drive more than two hours to get their cars serviced. Therefore, Mercedes-Benz wants to move closer to customer pockets. The penetration of luxury cars in such cities remains low as compared to metros, which presents more opportunities for growth. Currently, top metros account for around 70 percent of the sales annually, with the remaining 30 percent coming from mini-metros and other smaller markets.The luxury car market in India accounts for just over 1 percent of the total passenger vehicle sales of around 40 lakh units annually. On February 1, the Central government reduced the prices of jet fuel or ATF by Rs 1,221 per kl in Delhi, just before the Interim Budget. This is the fourth consecutive month in which jet fuel prices have been reduced. After the latest revision, domestic airlines in Delhi have to pay Rs 1,00,772.17 per kl for ATF, while airlines in Kolkata, Mumbai, and Chennai have to pay Rs 1,09,797.33, Rs 94,246.00 and Rs 1,04,840.19 per kl, respectively.These new prices are effective from February 1. The reduction in the price of jet fuel will provide some relief to airlines that are already facing financial difficulties, as jet fuel accounts for 40 percent of an airline's operating costs. On the first day of every month, Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL), and Hindustan Petroleum Corporation (HPCL) adjust the prices of cooking gas and ATF based on the average international price in the previous month.
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