Mercedes Benz India has recaptured the number 1 position in the Indian market thanks to its aggressive product launches and equally important has been the pricing of the cars which have been kept extremely competitive with help of local manufacturing. The company now intends to increase the size of the plant to increase production and export vehicles from India to other markets.
Mercedes Benz wants to make more in India
Roland Folger, the new managing director and chief executive said “We want to keep our place the No. 1 position, we are in discussions with the government, but there is nothing fixed yet.” Folger told ET. Mr Folger met the chief minister of Maharashtra in regards to seeking more tax benefits for their manufacturing plant near Pune. “The question is how we will extend our local facilities, that depends on tax advantages, reinvestment.”
The German giant wants to scale up manufacturing in India to cater to other markets where the business could be financially sound with respect to the taxes around import and export. “We have the capacity (in India), but there needs to be a country with (which India has) a free trade agreement or some sort of agreement that would make exports financially viable,” he said.
We would like to increase the number… we will be looking for a local supplier that can be a global supplier and at the same time be competitive. We need to talk about a few hundred thousand parts or components as we need the benefits of scale,” Folger said
The company invested 1000 Crore in a 100-acre plant at Chakan and has doubled the capacity from 10,000 units annually to 20,000. As much as 60 percent of the components used in these are sourced locally. It has four local suppliers who supply engines, gearbox, axle, cockpit, flooring and wiring harness.
The Chakan plant is the only one outside Germany to manufacture the Maybach S500, which retails at Rs 1.57 Crore in India. It also has the distinction of being the costliest car to be manufactured in India.