BMW revises sales target by 40%

Enthused by the response from Indian luxury car buyers, Germany's BMW has upped its sales target in the country for the calendar year 2008 by 40 per cent to 2,800 units. Of these, 2,200 cars will be rolled out from the company's assembly plant near Chennai, while the remaining will be imported from Munich, the premium car maker's global head quarters.

Should BMW achieve its sales target, it would grow over last year's sales by 102 per cent. BMW's optimism comes at a time when the passenger car market in India is worrying about ending up with a single digit growth in the 2008-09 financial year.

The company measuring against its own stringent standards, believes that it has done better than expectation in India so far. While the sales target for 2007 was 1,000 cars, the Indian operations of BMW closed the year with sales of 1,387 luxury vehicles.

David Panton, senior vice-president, Asia-Pacific and president, South Africa, said "This is no small revision for a company like BMW", which prices its cars between Rs 27,00,000 (320i model) and Rs 1.31 crore (M6 convertible).

The company's assembly plant at Mahindra World City, near Chennai can roll out 3,000 cars a year. "This capacity should be enough for our sales target in 2008 and 2009. In any case the 3,000 cars-a-year capacity is on a single shift basis," said Panton. Revision of the current year's target by BMW is in response to the mid-year review of its performance and outlook for the rest of year.

Interestingly, BMW's upward revision of target comes at a time when the Indian car market is not in the best of its form. The domestic passenger vehicle market, after closing 2007-08 with a growth of 12 per cent, is in the midst of major price increases due to rise input costs. The industry is also hit badly by the spiralling oil prices.

The luxury car market, which is limited to a few thousand units in India, is clearly hotting up. This market is currently dominated by BMW and Daimler's Mercedes. Another German luxury marquee Audi, part of the Volkswagen Group, is also making its presence felt in India.