New Delhi: Luxury car maker BMW today said it has sought regulatory approval for incorporating a finance subsidiary to serve the credit needs of retail customers, fleet owners and dealers.
“We are going to invest $50 million over the next two years in the project. We have applied for the NBFC status and we are hopeful of securing government permission by May 2010,” BMW India president Peter Kronschanabl said.
BMW sought the Non Banking Financial Company (NBFC) status for its proposed retail financing arm — BMW Financial Services India — which would be a wholly-owned subsidiary of the BMW Group, on par with BMW India, and would be run by a new head. It would be headquartered at Gurgaon.
The investment for the financing arm would be made by the Munich-based BMW Group, Kronschanabl said.
“I believe we will be competitive in the market. But at this moment I cannot say anything about issues like interest rate and other technicalities,” he said.
BMW Financial Services was established in 1993 and it has subsidiaries in 31 countries, besides presence in more than 60 nations across the globe.
BMW is planning to launch its two-seater roadster ’Z4’ in India in October.
“The Z4 will hit the roads in early October and it will be priced in the range of Rs50-60 lakh. We hope to sell at least 30-40 units of the car in the first year,” he said.
Kronschanabl said BMW India is targeting a sales of over 3,000 units this year, driven mainly by its 3 Series and 5 Series sedans.
“We have sold over 2,200 units during the January-August period this year. Our plan is to cross the mark of over 3,000 in sales by end of the year and this will be mostly on account of the 3 and 5 Series,” he said.
BMW India had registered a sale of 2,908 units in 2008.
“During January-July this year, we have registered a growth of 14 per cent, while the total Indian luxury car market has grown by four per cent. We are now the leading luxury car brand in India and we hope to maintain the position,” Kronschanabl said.
The company today opened it second dealership in the national capital. Currently, it has 15 outlets across the country, which it aims to expand to another 10 cities by 2010.