BMW to focus on smaller cities to boost sales

German luxury car brand BMW will consolidate its market position by extending its presence in tier-II and III Indian cities over the next one-and-a-half years, a senior executive said today.

The dealership base of the company will be enhanced from existing 24 facilities to 40 in the next one-and-a-half years, BMW India President Andreas Schaaf said.

"Further, we aim to have 60 facilities by 2015," he told reporters at Verna, 20 km from here.

Schaaf, who commissioned BMW's Goa facility at Verna, said the company intends to drive into smaller towns from its current thrust on the auto markets like Delhi and Mumbai.

The company, he said, gets 70% of its total sales from Delhi and Mumbai markets and this figure is likely to drop once sales pick up in tier-II and III cities.

Schaaf said they are examining the market potential of smaller cities and towns.

BMW claims 41% of share in the luxury car segment of the country. Schaaf said the market share is expected to grow further with the introduction of SUV X 3 model, which is scheduled to be rolled out in September.

The carmaker's Chennai plant has already started assembling the new vehicle, which is considered as ideal for Indian conditions, he added.

BMW India, a 100% subsidiary of BMW Group, was set up in 2007. Since then, Schaaf said, the network of dealers has been established across India. "We did not engage traditional dealers. The company searched for like-minded dealers who would identify themselves with our ideology."

Bavaria Motors, which has BMW dealership in Pune, was given the dealership in Goa.