Manufacturing Components in India to address Inflation Costs- BMW
Indian Prime Minister, Mr. Narendra Modi, recently launched the Make In India campaign, which is attracting companies around the world to manufacture their products in India. Following Ford who recently invested on a new plant in Gujarat, BMW has taken the cue and has increased localization. localization will also cut down cost of ownership.
BMW has localized the production of engines and gearboxes at its Chennai plant which has a capacity to produce around 14,000 vehicles annually. 95 % of all vehicles sold by the company were built-in this plant. The capacity utilization is now between 60% -70% and this figure is expected to increase.
BMW manufacturers the BMW 1 Series, BMW 3 Series, BMW 5 Series, BMW 7 Series, BMW X1, BMW X3 and the BMW X5 in its Chennai factory . The BMW X6 and the BMW 6 Series along with their exclusive products, the BMW Z4 and the BMW i8 come in via the C.B.U. route. The company has plans to launch 15 new models this year. This will include a the flagship BMW M variants. BMW already has the BMW M3 and the BMW M4 and the BMW M5 on sale in India.
The company says localization is helping them address challenges like inflation. The demand for luxury cars in the country is good and has a good growth. BMW expects this growth to continue for the next ten years at least.BMW plans to expand its dealership network in India, from Metropolitan cities to Tier 2 Cites BMW hopes to cash in long-term growth profits.
Source – Economic Times