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Mercedes To Localise Production To Cut Costs
Peter Honegg, managing director and chief executive officer of Mercedes Benz India Ltd said: “We are looking at producing some of our best-selling CBU (completely built unit) cars locally. We will start with the M Class which has been accepted well by our customers in India. In two-three years, we would bring in A and B Class premium hatchbacks to India."
Mercedes currently builds the C, E, and S Class models in India. The carmaker sold 327 units of ML 350 cdi which costs more than Rs.55 lakh between January and June. The German luxury carmaker is also contemplating introducing the A-Class and B-Class compact cars along with the Smart branded small cars in India.
Suhas Kadlaskar, director, corporate affairs and human resources, Mercedes-Benz India Limited (MBIL) said: “As volumes grow, we will look for increased local value-addition on the existing products as well. We have developed a base of six suppliers from whom we source components largely for the C and E Class models."
Mercedes-Benz wants to increase localization in the C-Class and E-Class to about 40 to 50 per cent. It is also investing Rs.250 crore to build a paint shop in its plant.
MBIL has reported sales of 3,798 units between January and June registering a 58 per cent increase after it sold 2,402 units during the same period last year. Mercedes' German counterpart and competitor BMW's sales are higher at 4,524 units.
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