BMW eyes 3-fold sales rise

BMW expects three-fold growth in sales of its 5-Series sedan at 900 units in 2008 itself. In parallel, its 3-Series sedan, also assembled in India, clocked sales volume of 643 units and emerged as the bestseller in the country in 2007, while the 5-Series sold around 300 units.

Speaking at the sidelines of the launch of its first dealer outlet in eastern India called OSL Prestige, Ralf Bissinger, director for sales and marketing of BMW India, claimed that the products of its competitors were nearing the end of their life-cycle in India.

This would boost BMW 5-Series sales in the Indian market though the BMW model too was around five years old but had received a facelift a year ago, Bissinger added.

This year, BMW India had sold 862 units in all till March.

It hoped to sell around 2,000 units, including 900 units of 5-series sedans, 650-700 units of 3-Series sedans, around 200 units of 7-Series sedans, over 100 units of its X5 sports activity vehicle and 30-40 units of the 6-Series convertible. In 2007, BMW India sold 1,387 units. In this category, Mercedes-Benz was the market leader with sales of 2,491 units.

The luxury car market in India was around 4,500 units in 2007. The luxury car market in India was comparable to countries like Egypt and Malaysia but way short of China where BMW alone sold over 50,000 units in 2007. BMW had 10 dealers now and aimed to add two more at Cochin and Ahmedabad later this year. It aimed to open service outlets at locations like Bhubaneshwar, Lucknow, Jaipur and Coimbatore. OSL Prestige aimed to sell 50 cars this year and double the number in 2009.

Delhi was BMW's biggest market in India, followed by Mumbai. BMW has recently spent $7,50,000 in scaling up its Chennai assembly unit capacity from 1,700 units to 3000 units per year with initial investment in India of around $30 million.

While both BMW 3-Series and the 5-Series were assembled at Chennai, only 10 per cent of components were sourced locally and they included seats, seat-covers, seat-electronics and door panels.

The company had set up an international purchase office (IPO) at Gurgaon to assess purchase opportunities for items like forgings and castings, said Peter Kronschabl, president of BMW India.

At present, BMW sourced horns for its 5-Series globally from India through tier-II suppliers.

BMW expected to finalise its report on outsourcing opportunities within June 2008.