Mercedes-Benz India has observed a notable increase in its diesel vehicle sales, with the segment now accounting for 40% of its overall sales for the current year, a rise from 38% last year. This trend emerges even as the luxury automaker actively expands its electric vehicle (EV) and plug-in hybrid (PHEV) portfolio in the country, recording a 16% growth in EV sales during the January-September period of 2026.
Sustained Demand for Diesel
Santosh Iyer, managing director and CEO of Mercedes-Benz India, stated that there is no evidence of a structural decline in diesel demand. "In our case, our diesel demand has gone from 38% to 40% this year. So, in fact, my diesel share has gone up this year. I don't see any reduction in diesel," Iyer commented.
The company maintains a strategy of offering a diverse range of powertrain options, allowing customers to dictate the pace of electrification based on their specific needs and market conditions. This approach acknowledges that different technologies cater to varying customer requirements and preferences.
Multi-Powertrain Strategy and EV Growth
Mercedes-Benz India continues to offer petrol, diesel, plug-in hybrid, and fully electric vehicles. Iyer emphasized that the company remains "agnostic" on powertrain types, committed to supplying whichever technology meets customer demand. This strategy is evident in the introduction of plug-in hybrid versions for models like the E 53 and S-Class, alongside the launch of the Mercedes-Maybach S 580e.
Plug-in hybrids are highlighted as offering the "best of both worlds," providing over 100 kilometers of pure electric driving range, with a combustion engine available for longer journeys or when charging infrastructure is unavailable. This flexibility appeals to buyers concerned about range anxiety or charging accessibility.
Adapting to Regulatory Frameworks
Iyer also welcomed the CAFE 3 regulations, which provide manufacturers with greater flexibility in determining their powertrain mix to meet fleet efficiency targets. He noted that while the ultimate goal may be electric mobility, a clear pathway is essential, suggesting that market demand should guide powertrain offerings rather than premature withdrawals of specific technologies.
It is important to note that, despite the overall increase in diesel share, Mercedes-Benz currently does not offer a diesel powertrain for its S-Class model in India.