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Mercedes Benz to invest Rs 3.5 billion to enhance operations in India Print E-mail
Written by Vivek   
Saturday, 11 December 2010
Pune: Mercedes Benz  plans to invest $78 million in its Indian operations to expand capacity and increase production in the wake of increasing demand for luxury vehicles in the country.

Following the the roll-out of its 30,000th locally assembled car, a Mercedes-Benz E-Class from its Chakan facility in Pune, the firm's managing director and chief executive officer Wilfried Aulbur said that Mercedes Benz India Ltd (MBIL) has recorded a year-on-year growth of 86 percent in January-November 2010 and the company is moving into permanent two-shift operations with immediate effect  to double the plant’s annual capacity to 10,000 vehicles.

“Within two years of starting production at the Chakan facility, we have exceeded the first-shift capacity,” said Aulbur.

The company will also set up its own technologically advanced paint shop capable of eco-friendly water-based painting at the cost of Rs 2 billion in its Pune facility with the capability to paint all models from the Mercedes cars range.. The paint shop, having an annual capacity of 20,000 units and expandable to 40,000 units,  would be operational by the second half of 2012. Currently , MBIL imports  painted body panels or utilizes Tata Motors' paint shop located at Chikhli, near Pune. Aulbur said the company will also commence operations at its body manufacturing unit next year.

The company will also hire 250 more staff for the second shift. At present it has 556 staff at the production plant.

Mercedes-Benz's total investment in Chakan plant will increase to more than Rs.6 billion when this facility has been set up.

MBIL's Chakan facility currently employs 700 people and the headcount will increase to 1400 when the paint shop and body manufacturing unit become operational.

"By 2013, we will see more vehicles coming into the country that will be produced locally," he said.   

"Our plant is regarded among the best CKD plants of Mercedes, globally. Within two years of moving into the new facility we have already fulfilled our first shift capacity. Start of our second shift will cater to the increased market demand as we foresee in the years to come." commented Dr. Aulbur.

"We plan to indigenize more and more products in India, focus upon local sourcing and optimize local value addition. We have decided to increase the portfolio of locally produced cars beyond the S-, E- and C- Class range starting 2013" commented Suhas Kadlaskar, Director Corporate Affairs and Human Resources.

Mercedes-Benz India Limited, set up in 1994, manufactures the C Class, E Class and S Class models at its Chakan plant.  The portfolio of locally produced cars is likely to be increased by 2013. MBIL has achieved a record wholesale figure of 5416 units for the period Jan-Nov 2010.

In January to November 2010 the company sold a total of 5,416 units of passenger cars, a growth of 86 per cent over the same period last year. "The luxury car market grew by approximately 65% in Jan-Nov 2010 while Mercedes-Benz India grew faster than the market at 86% in the same period,” said Dr. Aulbur.

Last Updated ( Saturday, 11 December 2010 )
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