Luxury cars, mobile phones buck slowing trend in India
By Rina Chandran
MUMBAI (Reuters) - Have money, will buy Mercedes and mobile phone.
That seems to be the mantra in India, where sales of luxury cars and mobile subscriptions are bucking the overall trend of lower consumer demand and slowing economic growth.
India's benchmark stock market is down more than half in 2008, industrial production has fallen and analysts expect economic growth could slow to below 7 percent in the year to March 2009 from 9 percent or higher in the past three years.
But that has not stopped mobile phone operators in the fastest growing market for mobile phone services from adding a record 7.7 million mobile users in October to their GSM networks.
Leader Bharti Airtel alone added 2.7 million new subscribers, while No. 3 Vodafone Essar rang in its highest numbers ever, a whopping 2.1 million.
Subscriber additions can continue at the same fast clip if operators stick to their expansion plans, said Usha Rajeev, head of the telecom practice at PricewaterhouseCoopers.
"Generally, in times of trouble, people feel a heightened need to stay connected and keep up with the news," she said.
"Also, the mobile phone is not considered a luxury product anymore; it's almost an essential commodity," she said. Continued...