BMW to re-think planned launch of Mini in India

BMW, the world's largest premium car maker, is reconsidering a plan to launch its Mini hatchback in India by the end of this year, having already delayed it from 2007, a senior official said on Thursday.

The Mini would be imported and would carry a price tag of around 2 million rupees ($41,000), Peter Kronschnabl, the president of BMW's India unit, told reporters at the local launch of the BMW X6.

"Last year we decided to postpone the launch of Mini in India by a year, as we had doubts regarding the viability of the project. We would again take a look at it by the end of the third quarter of the calendar year," he said.

The luxury hatchback market was not developed in India, and the investment to launch a new brand would be substantial, Kronschnablhe said.

"So we have to re-look at the potential business opportunity before launching it," he said.

BMW sold 1,747 BMWs in the first half of 2009, about a quarter of total Indian luxury car sales of 7,400, and its sales growth of 12 percent was better than the sector's 1.5 percent, Kronschnabl said

"We are confident of delivering 3,000 cars to our customers in India in the year 2009," he added.

The company recently raised annual capacity at its Indian plant to 3,000 units from 1,700 on a single-shift basis at a cost of $750,000, he said.

BMW, which competes with European rivals DaimlerChrysler, and Volkswagen in the premium car market in India, makes the 3 and 5 series in India and also sells its 7 series from imported kits.

The German carmaker was close to signing an agreement with global manufacturers for sourcing components from India, starting with forging and casting material, he said.

"All I can say at this moment is that, we are very close to signing contracts with the global manufactures and it should be in place by December 2009," Kronschnabl said.