BMW set to start production in India

Singapore: Germany's BMW will start assembling cars in India next month and expects to produce 1,000 vehicles in the plant's first year of operation, it said yesterday.

The Munich-based company also said it would stick to its goal of selling 150,000 cars in Asia by next year, after sales in the region climbed 13.8 per cent last year to a record 126,949 vehicles.

BMW's plant in Chennai in India's southern state of Tamil Nadu is the group's fifth factory in Asia and will make 3 and 5 series BMWs exclusively for the Indian market.

"It will be around 1,000 units this year and we'll bring it up to the plant's capacity of 1,700 next year," BMW management board member Michael Ganal told journalists after a news conference.

Rising demand

BMW, the world's biggest premium carmaker ahead of DaimlerChrysler's Mercedes-Benz, hopes to sell around 1,000 cars this year in India, up from just 257 last year.

Ganal said India was a difficult market but added that the firm expects to profit from rising demand for its luxury cars as a result of rising wealth.

Sales in the premium segment - which includes such brands as BMW, Mercedes-Benz, Lexus, and Audi - in Asia's third-largest economy reached 5,400 cars last year and Ganal expects that figure to rise to around 10,000 by 2012.

The company also said sales of BMW brand cars in Asia rose 15.5 per cent in 2006 from the previous year to 109,848 units.

Sales of its popular Mini in Asia rose 3.7 per cent to 16,959 vehicles, while its ultra-luxury Rolls-Royce Phantoms sold 142 times - 40 more than in 2005.

Sales of BMW motorbikes were almost unchanged at 3,620.