Go Back   Team-BHP > BHP India > The Indian Car Scene


Reply
 
Thread Tools Search this Thread
Old 20th June 2017, 10:49   #1
Senior - BHPian
 
dZired's Avatar
 
Join Date: Jun 2012
Location: Jaipur
Posts: 1,719
Thanked: 7,400 Times
Default BMW to invest Rs. 130 crore in Indian arm

BMW has announced that it will be investing Rs. 130 crore in its Indian arm. This fresh investment will take the German automaker's total investment in India to Rs. 1,250 crore.

Funds from the said investment will be used across BMW Group's operations in the country. This will include the four-wheeler division, BMW Motorrad as well as BMW Financial Services. With this fresh investment, BMW's Indian arm is planning to expand its dealer network in the country. BMW currently has 18 dealer partners with outlets spread over 30 cities. The company's two-wheeler arm - BMW Motorrad is also looking to expand retail operations before launching its mass market offering, the G 310 R.

Talking about the said development, BMW India's President - Vikram Pawah, announced that the company will be expanding its retail sales outlets from 41 to 50 by the next year. The company is also looking forward to launch two new models in the future. These include the new-gen 5 Series and the recently unveiled 6 Series GT.

Source: Car and Bike
dZired is online now   (8) Thanks Reply With Quote
Old 20th June 2017, 13:42   #2
BHPian
 
Join Date: Oct 2016
Location: Lucknow
Posts: 35
Thanked: 36 Times
Default Re: BMW to invest Rs. 130 crore in Indian arm

It's a great gesture of confidence by BMW in the current times when companies are exiting the market. The investment I think will majorly go towards their financial services arm which will help them make inroads into Tier 2 and 3 cities.
Well done!
Stratosphere is offline   (3) Thanks Reply With Quote
Old 20th June 2017, 15:37   #3
Senior - BHPian
 
Join Date: Mar 2011
Location: Back to Chndgrh
Posts: 2,006
Thanked: 2,458 Times
Default Re: BMW to invest Rs. 130 crore in Indian arm

wonder if BMW Actually invests at Dealership's infrastructure as Dealer's views are different. Regarding investments in Financial services - that maybe to take advantage of the higher returns in India over the meager returns in Europe and elsewhere. Not exactly an investment in my opinion.

If they had announced setting up an engine plant or a partnership with ZF to set up a transmission plant, it would have been different.

Last edited by Turbanator : 20th June 2017 at 15:42.
Turbanator is offline   (5) Thanks Reply With Quote
Old 20th June 2017, 15:50   #4
Distinguished - BHPian
 
smartcat's Avatar
 
Join Date: Jun 2007
Location: Bangalore
Posts: 2,701
Thanked: 9,712 Times
Default Re: BMW to invest Rs. 130 crore in Indian arm

Quote:
Originally Posted by Turbanator View Post
Regarding investments in Financial services - that maybe to take advantage of the higher returns in India over the meager returns in Europe and elsewhere. Not exactly an investment in my opinion.
This allows BMW to launch innovative finance schemes to push sales. Low or zero down payment, guaranteed buyback price after 5 years, 4 or 5% interest rates etc. Traditional banks or finance companies might not be able to offer such schemes.

Quote:
If they had announced setting up an engine plant or a partnership with ZF to set up a transmission plant, it would have been different.
Done! Way back in 2015.
http://www.autocarpro.in/news-nation...nai-plant-8366
smartcat is online now   (5) Thanks Reply With Quote
Old 20th June 2017, 16:00   #5
Senior - BHPian
 
Join Date: Mar 2011
Location: Back to Chndgrh
Posts: 2,006
Thanked: 2,458 Times
Default Re: BMW to invest Rs. 130 crore in Indian arm

Quote:
Done! Way back in 2015.
Yes, but all these are only buying agreements with no investments most likely. I don't think they take help of anyone else in producing Engines at Germany or USA. What Force Motors does is anybody's guess, I can only imagine bolting some screws on almost ready to assemble engines from CKD kits shipped to Force from BMW Germany. This was necessitated due to revised CKD guidelines a few years back.

Quote:
Traditional banks or finance companies might not be able to offer such schemes.
Agreed but does it actually qualify as an Investment perse? I mean giving money to the financial arm which can be taken off whenever required?

Last edited by Turbanator : 20th June 2017 at 16:09.
Turbanator is offline   (6) Thanks Reply With Quote
Old 21st June 2017, 12:01   #6
GTO
Team-BHP Support
 
GTO's Avatar
 
Join Date: Feb 2004
Location: Bombay
Posts: 46,536
Thanked: 80,232 Times
Default Re: BMW to invest Rs. 130 crore in Indian arm

Quote:
Originally Posted by Stratosphere View Post
It's a great gesture of confidence by BMW in the current times when companies are exiting the market.
Also shows how easy it is for a renowned brand to set up CKD operations & rake in the moolah. According to the article:

- BMW has invested 520 crore in India (this isn't counting the 730 crore in its financial services)

- If you count annual sales of 8,000 cars and a net profit of anywhere between 3 - 5 lakhs per car, you recover your investment in merely 1 - 2 years.

The CKD operations don't have to be complex. All they do is screw together stuff that's ready to use. BMW & Mercedes India have even outsourced engine assembly (to Force).

Now you know why even tiny Volvo is going the CKD route in India.
GTO is offline   (5) Thanks Reply With Quote
Old 21st June 2017, 14:31   #7
BHPian
 
Join Date: Oct 2016
Location: Bombay
Posts: 126
Thanked: 666 Times
Default Re: BMW to invest Rs. 130 crore in Indian arm

Quote:
Originally Posted by smartcat View Post
This allows BMW to launch innovative finance schemes to push sales. Low or zero down payment, guaranteed buyback price after 5 years, 4 or 5% interest rates etc.
Exactly what I was thinking. I was surprised by this, as 130 cr is too low an amount for "investment" in any infrastructure or long term development. I'm surprised that this even warranted a media release.

Maybe this enables them to take money from outside at an extremely low ROI and flush the Indian arm with finance support.
ach1lles is online now   (3) Thanks Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
Ceat to invest 2,800 crore; boost capacity by 2.4 crore tyres dZired Tyre & Alloy wheel Section 5 29th March 2017 15:59
Renault-Nissan to invest Rs. 5,000 crore in plant expansion. EDIT: Might be 500 crore Aditya The Indian Car Scene 6 7th September 2015 15:39
Tata to invest Rs 600 crore on combat vehicle production DukeNukem Commercial Vehicles 1 29th August 2012 11:59
M&M to invest Rs. 500 Crore in Indian Two-Wheeler Market Jignesh Motorbikes 3 22nd May 2012 14:26
ET - Mercedes-Benz plans to launch five compact cars in India; invest Rs 350 crore vinod332002 The Indian Car Scene 1 6th March 2012 10:33


All times are GMT +5.5. The time now is 22:41.

Copyright 2000 - 2017, Team-BHP.com
Proudly powered by E2E Networks