India auto sales grew for the 12th consecutive month in January. New entrants, new launches, low interest rates and improved rural sales helped auto manufacturers achieve record January sales.

The figures led Pawan Goenka, President of Mahindra and Mahindra to say, "We can say that the worst is behind us provided there are no jolts in future in the form of hikes in interest rates, excise or commodity prices".

High percentage growth, small unit sales

While the booming small car segment is providing volume sales opportunity, the premium end of the market has performed exceptionally well even during economic uncertainty. However, while growth in percentage terms looks spectacular actual sales figures are small due to the luxury segment being so new.

Caught out by the "unanticipated rush"

Porsche fears that it will not have enough Panamera sedans due to an "unanticipated rush". Rod Wallace, MD of Precision Cars - the official importer to India - said "India had a quota for 50 Panameras for the first year and going by the demand the model has seen, we fear that we may exhaust the inventory very early".

Mercedes-Benz India made a record 403 sales in January. In addition they launched seven models, bringing their Indian range up to 38 models of vehicle.

Yearly sales at BMW India grew 28% to 2,627 vehicles, while Audi India sold 977, an increase of 61%.

Underdeveloped market lacks loyalty

Prestige and an embryonic market means that prestigious late entrants can quickly create sales momentum.

"The luxury car market is tilted to fresh arrivals as the buyer in this segment is always looking for exclusivity," said Deepesh Rathore, managing director with business analysts IHS Global Insight. "Hence there will always be potential for a new player entering the market".

According to reports this week, Aston Martin are said to be looking to use the cachet of their brand to exploit the lack of loyalty.

Premium motorcycle entrants

Luxury bike makers are also entering as they seek to benefit from India's obsession for two wheels. Harley-Davidson have made their intentions clear and Ducati is expanding its presence with a new showroom in Gurgaon, and others planned in Kolkata and Bangalore.

Mahindra and Mahindra is reported to be in discussions with European motorcycle manufacturers about developing premium bikes for the Indian market.