After posting record sales in 2017, India’s luxury-car market is on course to hit anew peak this year. Sales have topped 20,000 units in the first half of the year, expanding in double digits every month through June with an average growth rate of 12-13%. Total sales for 2017 were about 39,000 units, a 17% increase over the year before.The growth in luxury-vehicle sales for the past year and half has been in tandem with or faster than the overall passenger vehicle market, with new product launches, expanding dealer networks and 13% growing prosperity among buyers whose profile now includes an increasing number of women driving demand.Four of the top five luxury-car manufacturers posted double-digit growth since January. Sales at Mercedes-Benz and BMW rose 12% and 13%, respectively, while Jaguar Land Rover posted growth of 66% and Volvo, 33%. For all the four carmakers, sales from January to June 2018 were the highest ever for a six-month period in India.Most of the numbers announced are retail, clearly reflecting the demand environment — automakers in India usually report only dispatches to dealerships, which may not show the actual sales to consumers. This growth in 2018 is despite an import duty bump in this year’s budget, which saw car prices being impacted. The growth could have been faster if not for a decline in sales at Audi India, which is undergoing a product life-cycle change.Mercedes-Benz India managing director Roland Folger said the company achieved strong sales in the first half despite last year’s pre-GST surge in demand — while the overall market saw consumers deferring purchases before the GST roll out last year expecting a fall in tax rate, the luxury space reported a sales surge. The second half of the year looks promising with the festivals season now set to start, he said. “We hope for steady sales growth for the remaining quarters, as there are exciting products and services in the pipeline.”The luxury-car market over the last three years has been disrupted by a series of legal, regulatory and taxation challenges. If 2015-2016 saw a ban on large diesel-run cars in the National Capital Region, it was the impact of demonetisation and GST in 2017. The industry had to encounter a duty spike again in this financial year’s budget. But, industry players say the prevailing demand environment was largely driven by fundamentals and that growth would only accelerate in the second half.Vikram Pawah, president of BMW Group India, said his company’s strategy of introducing new and innovative product segments in the Indian market has started showing results. “The BMW 6 Series Gran Turismo and the BMW X3 have exceeded our expectations and we see remarkable sales contributions coming from both in the future. Also, introduction of Euro 6 petrol engines in our product portfolio has played an important role in our strategy,” added Pawah.New model excitement is likely to intensify in the coming months as the nation moves into the festival season. Automakers had planned more than 40 launches during the year. While some of these have already been introduced, at least a couple of dozen new launches are expected in the rest of the year. Launch of new entry-level cars and SUVs, attractive finance packages and opening up of small cities and towns have offered more people access to taste luxury in India.“We have seen Tier 1and 2 cities with high sales potential emerging as key hubs of future growth. This is an encouraging trend highlighting the market potential of smaller towns in mid to long term and we will continue our expansion drive there,” Folger said.