Daimler Pegs Future India Production at 5000 Cars

Quick, what country has the most billionaires in Asia? Japan is a good guess, because they’ve held the title for twenty years in a row. But it’s not Japan. Well, then, China, you say. The economic growth in China has been tremendous, so it must be China. Another good guess, but nope.

As the people at Daimler know, it’s India, as of 2006. And the people at Daimler also know that billionaires (and millionaires, too) really like to drive around in Mercedes-Benz automobiles. It’s that way everywhere in the world, and Daimler is betting that it’s going to be that way in India as well.

With that in mind, Daimler is building a new plant in Pune, India, that will have production capacity of 5000 luxury cars a year, starting in 2009. Construction cost of the new plant is estimated to be $67 million USD.

Daimler has a production facility in India currently through a joint-venture with Tata that assembles about 2000 vehicles annually, but demand for Mercedes-Benz cars is far outstripping demand in India, so Daimler decided to get more production capacity going as soon as possible. Double-digit growth in auto sales will be probably be the norm for at least the next few years, and everyone, including Daimler, is looking to leverage the market in India.

It is expected that the plant will focus on production of the Mercedes C-Class and the Mercedes E-Class initially.

Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

Share This Post On

1 Comment

  1. 5000 cars in a country as big as India? Doesn’t seem like much, even if the cars are luxury cars from Mercedes. Would just about every Mercedes be chauffer-driven? My friend from India says that anyone that can afford a Mercedes in India can afford a driver because a Mercedes-Benz is very, very expensive and human labor is very, very cheap.

Submit a Comment

Your email address will not be published.