BMW shifts strategy from volumes to sustainable profit growth

Company localises most of its products to take on competitions

Germany-based luxury car manufacturer BMW said on Tuesday that it was reworking its strategy. The company has been focusing on volume; it now wishes to focus  on sustainable and profitable growth.

“We are revising our strategy and it would be in place next month. We don’t want to look at high sales numbers but a profitable and sustainable growth,” said Robert Frittrange, managing director, BMW India.

He was speaking at the Confederation of Indian Industry’s southern annual regional meeting here on Tuesday. He added the company had drawn a strategy on country-specific products to attract a particular segment.

“We see a huge opportunity in India. But at the same time, we are cautious on sustainable and profitable growth though we might lag one or two players in this segment.” Globally, the strategy is to produce locally to increase market reach, get a share and be price-competitive.

Today 95% of the carsold in India, are manufactured locally, said Frittrang. The companylast year sold around 7,300 units in the Indian luxury market, whichis estimated to be around 40,000 units. Producing locally also means price competitive, said Frittrange, who added today company's products are on par with its competitions'.

Currently the company has seven offers to the Indian market and by end of 2014 the company plans to launch BMW GT (Gran Turismo), followed by BMW X5- the mid-size luxury sports utility vehicle (SUV), X5, which company claims one of the largest selling SUV globally. Speaking about the Chennai plant capacity, he said the plant can produce upto11,000 units with three shifts, currently only one shift is in place.