BMW to expand dealer web, widen range

Following a successful year in the country, global luxury car maker BMW plans to expand its dealer network in India.

While the German giant is considering metros and mini metros in the first round of expansion, it would also target tier-II cities with high consumer spending, Peter Kronschnabl, president, BMW India, said on Wednesday.

Kronschnabl was speaking on the eve of a special demonstration initiative called "Discover Driving Pleasure" hosted by the company at the picturesque Amby Valley township in the Western Ghats near Lonavala, some 80 km from Pune.

"At present, there are eight dealers. This number will go up by four in the next few months," Kronschnabl said.

The new BMW dealers would come up in Pune, Ahmedabad, Kochi and Kolkata, Kronschnabl said. He said the company would, thereafter, consider going to tier-II cities such as Surat or Coimbatore, where there is a sizeable buying power.

"The expansion of dealership follows a successful first year in India as the company has sold 1,100 units till now. We expect the number to rise faster in the months to come," he said, adding that about 900 of these were 3 series and 5 series cars with 180 of 7 series units.

BMW has set up a plant near Chennai at an investment of Rs 110 crore (Rs 1.1 billion) to make 1,700 cars a year on a one-shift basis. Kronschnabl, however, declined to disclose the sales estimates for 2008.

Reacting to a query on the nature of competition, in the backdrop of the entry of Audi and Volkswagen, Kronschnabl said the company perceives the luxury car segment in India to expand rapidly.

BMW may consider bringing its other global offerings such as the 3 series convertible or coupe, depending upon the market. The introduction of the X6 model was also a possibility, he indicated.

"We will follow the rule of 'production follows the market' as far as introduction of new products is concerned."

He said an announcement about the introduction of the Mini was expected in early 2008. Kronschnabl said the luxury car segment, with a sales of 8,000 units last year, was estimated to grow 50 per cent this year.

"The segment was so far restricted by the sheer absence of availability and competition," he stressed.

BMW currently imports its cars as completely knocked down, which are assembled at the Chennai plant.