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Shifting gear
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Gurgaon, Feb. 15: German car major BMW will not focus on raising volumes in India by tweaking prices. Instead, it plans to pull customers on the strength of a premium price positioning and a strong brand proposition.
The owner of the Mini and the Rolls-Royce brands has launched an updated version of its sports utility vehicle X1 at a higher price.
“BMW is a premium brand and we do not want to dilute that perception by entering into any price wars or numbers game. We are looking at sustainable growth and a premium price positioning,” Phillip von Sahr, president BMW India, told The Telegraph.
Last month, BMW hiked the prices of its entire range of cars, including the Mini, by up to 6 per cent to maintain its premium appeal.
The company says it will not get into discounting to increase volumes even though it holds only a slim lead as the No. 1 premium car maker in India against Audi.
The base version of the BMW X1 is priced at Rs 27.9 lakh, which is around Rs 40,000 higher than the base variant of the earlier X1.
The other two variants — the X Line and the Sport Line — are priced at Rs 32.5 lakh (ex-showroom all-India). The earlier X1 had all its variants priced at sub-Rs 30 lakh.
First launched in 2010, the company has sold over 5,400 units of the X1.
The X1 competes with the Audi Q3.
While the Q3 is a four-wheel drive, the X1 is not offering a four-wheel version in India. Global versions of the X1 have a four-wheel drive.
Audi launched the petrol variant of its Q3 in India earlier this week, priced between Rs 28 and Rs 33 lakh. Volvo is also set to launch the V40 Cross Country to rival the X1 in a few weeks.
Honda Cars launched a cheaper version of its premium SUV — the CR-V — earlier this week.
BMW India which sold about 9,375 units in India in 2012 said it is looking to grow its sales amid tough market conditions on the back of new launches and new dealerships.
“This year we are looking at a certain growth in India,” said Sahr.
The company will be driving the next generation 7 series in March followed by the premium compact hatchback 1 series to build volumes by end 2013. With this, the company will have 6 products (1 series, 3 series, 5 series, 7 series, X1 and X3) assembled at its Chennai factory.
While von Sahr said the overall economic situation does not look promising but the company is looking to sell more cars than last year. “We will be adding new dealerships and this will give us new market,” he said.
The Indian premium and luxury car market, which has been growing at a compounded annual growth rate of 30 per cent and stood at 23,000 units in 2011, witnessed some demand slowdown in the first six months of 2012 with just 9 per cent growth rate to sales of around 12,000 units. However, long-term prospects remain firm for the category.
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