BMW Plans To Increase Local Production In India


BMW is currently the number 1 luxury car maker in India, ahead of its German brotherhood but Audi seems to be catching up at quite a fast rate in line with their aim to become India’s number 1 luxury carmaker by 2014-15. Audi has said it will not participate in the volume game and still try being number 1. Mercedes Benz on the other hand looks to become the global leader by 2020 .

BMW has revealed its further production plans for India. BMW, at its Chennai facility, through its assembly line manufactures the X3, X1, 3-series and 5 series through a CKD route and the 7-series, M badged cars, 6-series, X5 and X6 are all brought as Completely built units (CBUs) because there are volumes are not enough to justify the setting up of an assembly line. But BMW has revealed that in future they might start to manufacture cars in India.

BMW Plans To Increase Local Production In India

The Germans have stated that to justify the investment that will go into the assembly line will be justified only if they manage to sell three times the cars they sell now which amounts to somewhere around 30,000 units an year, a threefold increase from its current 9,000 to 10,000 units an year. They also plan on a higher level of localization once the sales increase threefold. This will result in lower price tags and cheaper costs of maintenance than the current costs.

Localized production will infuse in more investment, generate employment and local dealers who are suppliers to luxury carmakers shall have an increase in business volumes. Mercedes Benz, Audi and Jaguar-Land Rover also have assembly lines in India and once the luxury car sales see an increase, more and more products will be localized . This is a long process and will take at least 5 years or so. The prices are going to come down once the sales volumes shoot up so we can just hope the volumes increase to an extent which prompt the makers of luxury cars to set up production facilities in the country. Stay tuned to us for latest updates.

via – ET