We'll launch 12 new models in 2015: Eberhard Kern

Interview with Managing director and chief executive, Mercedes-Benz India

Mercedes-Benz India closed last year at the second spot after Audi, with an overall growth of 13 per cent, selling 10,201 units. The German company stated that with 15 launches this year, growth would be in 'double digit'. Eberhard Kern, managing director and CEO, tells Swaraj Baggonkar what to expect this year. Excerpts:

Mercedes had a successful 2014. What is in store for this year?

A major plan is to launch 15 new products in 2015. Another pillar is to add 15 new dealers. We have the densest network of luxury car dealers and with this, the count will cross 80. Another approach is to create a unique customer experience. Therefore, we created the format 'Luxe Drive'.

What are your targets for the year?

Our clear target is to see another double-digit growth this year after 2013 and 2014 were extremely successful for Mercedes-Benz. The year has started well as January reported a 25 per cent growth and February, too, was good.

How many launches have happened so far?

The new CLA was the first product this year followed by the C-class diesel and now the B-class, which is the third new product. We don’t count engine upgrades as new launches; otherwise, we could have counted the A-class, too, that we have launched. So there are 12 more to come.

What are your investment plans?

We’re expanding our factory in Chakan, Pune where we are doubling capacity. The total investment there is Rs 1,000 crore. This gives us a capacity of 20,000 units annually. In six weeks, we will have our new capacity on stream. There, we’re producing five models as of today - S, E, C, ML and GL - and we just decided to add the CLA as the sixth model and there is more to come.

The list does not include the A and B class?

The A and B for the time being are imported. Right now, I can confirm local production of just the CLA. Any further plan is too early to talk about. The CLA belongs to the same family of A & B class.

What is the localisation content right now?

Today's localisation content depends on the model and is between 35 and 40 per cent. We assemble engines, gear boxes, axles, and transmissions; we do the body work, painting and assembly. We are slightly increasing the levels of localisation, but it is not an easy task. We have to make sure every car produced in India is equal to the globally produced Mercedes-Benz quality.

How is the luxury vehicle segment split?

The luxury car market has mainly four segments - sedan, sports utility vehicle (SUV), compact, and high performance cars. Our strategy is to grow in all the segments. Last year, sedans contributed 50 per cent, SUV 30 per cent, and compact 20 per cent. The high performance cars were small in number. We have to see how it develops. With so many products, you might see a change in the shares this year. Some of the new cars do not even have a predecessor in India.

Will the A class remain the entry model for Mercedes?

Yes, we will not go below the A class. By far, we’re leading in the compact segment. We now have four models in the compact segment — A, B, CLA, and GLA.