In line with the Indian’ government’s ‘Make in India’ initiative, BMW has increased parts localization by 50 per cent in its products for the Indian market. The German luxury marque has upped the number of local parts suppliers from two to eight in the country.
The latest move will see BMW assemble engines and gearboxes at its production facility in Chennai. At the moment, the Chennai plant has a manufacturing capacity of around 14,000 units per annum. Of all the BMW cars sold in the country, nearly 95 per cent of the models are assembled in India only. The higher localization of parts will enable BMW to address challenges like inflation while also keeping input costs in check, the company said.
Currently, BMW assembles eight models at its production facility in Chennai. The list of cars manufactured here comprises the company’s best-selling sedans such as the 3-, 5- and 7-Series models among others in India.
According to BMW, India’s luxury car market is steadily growing and the demand for high-end premium cars is only going to increase here for the next 10 years or so. Keeping that mind, BMW is planning to launch 15 new models in the country by the end of 2015. The company is also looking forward at strengthening its reach in Tier-II cities. To do so, BMW will expand its dealer network by adding 50 new outlets this year in the country. In addition to that, BMW will also launch more high-performance M-Series models in the country.
BMW’s sales (including sub-brand Mini) dropped by a whopping 7 per cent in 2014. In comparison, the company’s arch-rivals -Audi and Mercedes- both posted a positive growth and clocked sales of over 10,000 units last year. BMW, however, reiterates by insisting that the company is not merely looking at volumes but, focusing on a long-term profitable growth in India.
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