BMW goes aggressive on localisation

The BMW plant in Chennai, which started operating back in 2007, currently assembles the 1-series, the 3-series and 3-series GT, the 5-Series, the 7-series, the X1, the X3 and the X5 on two assembly lines.

 

Now, the company has announced its participation in the ‘Make in India’ campaign, by deciding to use up to 50 percent of local content during assembly, sourced from indigenous suppliers. Talking about this move to source parts locally, BMW Group India President, Philipp von Sahr stated that the BMW Group always looked towards India with a long-term perspective and that with cars already being locally assembled it was an appropriate time to partner with major Indian automotive parts suppliers. He also added that the decision would benefit BMW in areas of cost optimisation and value addition, while creating business and profitability for its suppliers.

 

Some of the major components to be sourced locally are going to be, the engine and transmission from Force Motors, axles from ZF Hero Chassis, door panels and wiring harness from Dräxlmaier India, exhaust systems from Tenneco Automotive India, air-con units from Valeo India and Mahle Behr, and seats from Lear India.

 

The company has not specified how this move will affect model pricing, but it is likely that the locally assembled models may be priced lower.