BMW India has more than doubled the level of local content in most of its luxury cars that will be sold in the country. With its latest localisation programme at its Chennai factory, the company has created about 200 new jobs by way of its suppliers.
“We have increased our localisation level up to 50 per cent now from 22 per cent earlier. In our product portfolio, about 95 per cent of the models will have this level of localisation. For example, there are 2,800 parts go into a model such as BMW 5 Series (priced between Rs.47 lakh and Rs.63 lakh) and half of them are made in India,” said Robert Frittrang, Managing Director, BMW Plant Chennai, during an event involving legendry cricket player Sachin Tendulkar at the factory.
The decision to enhance indigenisation is expected to help BMW in terms of cost optimisation and value addition, he added. But, a price reduction as a consequence of more local parts in its cars is unlikely.
However, Philipp von Sahr, President, BMW Group India, had earlier indicated that would be decreased frequency of price increases.
BMW has roped in seven new suppliers to source parts such as engine and transmission (Force Motors), Axles (ZF Hero Chassis), door panels and wiring harness (Draexlmaier India), exhaust systems (Tenneco Automotive India), heating, ventilating, air-conditioning and cooling modules (Valeo India and Mahle Behr) and Seats (Lear India).
Mr. Vahr said BMW had taken up a product offensive strategy for 2015 and was on track to launch 15 products including three new models during the calendar year.
“BMW is a price leader globally and in India too against our competitors. Also, our aim is to offer more than 100 per cent customer satisfaction in after sales,” he added.
The company’s Chennai factory, which employs about 450 people, has two assembly lines to produce up to 14,000 cars a year.
