For a company that has led the fast-growing domestic luxury car market from the second year of starting operations, BMW India still has a lot of fresh aces up its sleeve.

In an interview with Business Line , Dr Andreas Schaaf, President – BMW India, explains how the company plans to sustain growth by introducing its complete portfolio over the next few years, including the iconic Mini brand. This could be followed by smaller models in the future.

The X1 SUV has been driving your volumes for the past year. Is there now anything planned below that, maybe in the Mini brand?

Almost every second car sold by BMW in India is out of the SUV segment, which is a very significant number. One of the main targets of my stint is to launch the Mini.

If we decide to introduce the brand, I think the Countryman crossover will play a major role for India. The heart of Mini is certainly the Cooper hatch – which is the origin of the brand, but if you experience and look at the size of the Countryman, I think it would become the major selling model.

With the road conditions here, the higher ground clearance, spacious interior and lifestyle statement of SUVs, make it a more sensible model.

What will be your strategy for the Mini brand?

If we try to launch the brand, it will be a step-by-step approach. The Countryman is an important product for Mini, because this is the first time we've tried to grow the size of the car. And then we will have to look at how it is accepted in the market and how fast we have to develop our network.

I think within 2-3 years, the range should be completely available in India.

BMW is also said to be developing smaller cars than the 1-series. With the competition also heading the same way, what will be your strategy for India?

In the future, we'll have a platform for small cars, because worldwide there's a need of downsizing and front-wheel drives because of the emissions and (fuel) consumption aspect. Plus, they are needed in mega-cities.

Though we haven't yet decided what will be for India, there will be a whole range of cars under this.

The five markets we separately look into now are the Brazil, Russia, India, Korea and Turkey (BRIKT). There is not a single chance that a development these days does not take into account these.

We discuss our Indian operations every quarter with the management in Munich. Last time when I was there in July, I had a 45-minute presentation about India market development with the Board. This gives you a picture on how important these markets are for BMW.

One thing is for sure is that the power is shifting away from Europe to emerging markets, so if you have a long-term perspective on this business, as we have, then you have to look more carefully into this power shift.

At the current pace of growth, BMW would need a second assembly line in a year. Is this on track?

Yes, we will need a second line in the next few years as with the second shift capacity will almost be full at the first line. We already have the land and a decision on the new line will be made by end of this year.

The complexity of the Indian operations is the highest for BMW globally in terms of logistics and processes. We shift between models in a very short period of time, so it's all about flexibility.

Would you look to increase localisation production even further, may by set up an engine plant in India?

There are a couple of thoughts on more local assembly of models, but nothing has been decided. Yes, India is a car manufacturing country but what is made here is very different in terms of level of technology and refinement.

This is also the strength of India and its suppliers – the simplicity of things and the cost structure. There will be a transformation towards the manufacturing of technologically-advanced components. I think it's started and we want to be aligned to this development.

One day, perhaps, BMW will have full plant operations in India and it could export cars to other countries. This is what we have in mind for the next 10-15 years and will become a reality… we are trying to shape this.

If the country is growing in this way and is expected to continue, it wouldn't make sense to put another plant in Germany. Brazil and India are now at the centre of discussions for the expansion of our production plant network.

Your main competitor, Mercedes-Benz, has announced its intent to start car leasing services. What are your plans?

We will launch leasing products within the next month. For me, it's a no-brainer, we need these, but it's a little complicated internally in terms of the IT and legal issues.

It is important in terms of volumes, if you look at the US, leasing products are playing the major role. The main benefit is the hassle-free ownership experience, because at the end of the lease you just return the car.

>roudra.b@thehindu.co.in

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