BMW Group India has recorded its best-ever nine-month sales this year, between January and September, at 11,978 units of BMW and MINI cars, and the company expects to achieve double-digit growth for the full year. In an interview with businessline, the newly appointed President and CEO of BMW Group India, Hardeep Singh Brar, said that battery electric vehicles (BEVs) are already contributing 21 per cent to overall sales, and he anticipates this will reach 30 per cent by 2027, significantly ahead of the original 2030 target.
As the new CEO of BMW Group India, what will be your priorities and strategies?
The strategy has been quite strong for BMW, and I would like to build further on that. To give you a perspective, we’re doing extremely well with BEVs, and we would like to introduce more BEV models in segments where we aren’t present right now. We’ve been expanding our network, but I would like to further expand beyond the current 35-odd cities to 50 cities by the end of next year. So, network expansion would be the third area. Fourth would be in our financial services, where we want to introduce products that can genuinely transition consumers from the mass market to the luxury segment.
If we offer products where your EMIs are very close to those for mass-market cars, we can attract a significant number of customers. And, last but not least, is the customer experience—how we treat a consumer and deliver that luxury quotient for them. From a rational perspective, the cost of ownership is very important for a consumer, and we are already one of the best in the luxury segment in that regard.
When you talk about the cost of ownership, the first thing that comes to a mass-market upgrader’s mind is aftersales service. So how will you make sure that is taken care of?
We have Service Inclusive and Repair Inclusive, where we give maintenance packages for up to five years and even beyond. When a customer has these products, he or she doesn’t have to pay anything out of pocket after buying them. So, that’s how I look at it, like an extended warranty or insurance: once you have the package, everything else is taken care of. Consumers always have the anxiety: “What if something happens?” And, we have these packages to take care of those concerns.
The footfalls we have seen post the new GST regime, plus OEMs giving discounts—do you think there is a long-term gain or is this just a short-term phenomenon?
From August 15 to September 22, the business actually came to a standstill because everyone was expecting prices to come down. Currently, there is a huge surge that we are seeing; for example, we saw 40 per cent growth in September year-on-year, as well as sequentially versus August. So, I think this is that pent-up demand which is manifesting in these three months, and hence there will be a huge surge. From a long-term perspective, the growth rates won’t be as strong, but they will be much better than they were prior to the GST reduction. Issues like the situation in the IT sector and the stock market crashing had created a lot of negative sentiment, but the GST change has actually overcome all of them, and hence the sentiment is much better.
But, there is still negativity in the IT sector, and there have been some job cuts also recently. Do you think that would impact luxury car sales since the IT sector is one of the largest customer bases?
I really don’t see that happening because when we look at it, it wasn’t a regular IT employee who was buying; it was only at the top levels. The layoffs are happening more at the bottom rather than at the top. So, we don’t see that really impacting us, and this year we are growing better than last year. I think they (the IT sector) are all financially well off, and these global tremors don’t hit them so much. Every year, we feel that more consumers are coming into the luxury fold, especially the younger generation, which is now around 25-30 years old. They want to indulge in the experiences that the luxury and premium segments provide.
On the policy side, some state governments have special incentives for BEVs as well as hybrids, but some don’t have. Do you think special incentives should continue so that the government’s target of achieving 30 per cent sales from EVs in overall sales is met by 2030?
I think some of the state governments keep bringing their own policies; like, some of them are giving equal preference to hybrids. But, that derails the BEV agenda (of 2030). What has been decided once, I think we should stick to that, otherwise it gives very mixed messages. Hence, state governments should align with what the central government is doing, rather than making their own policy, which confuses the customer as well as the manufacturers.
