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Mercedes supports SIAM view of excluding auto sector from FTA

Indian Express, India

Mercedes supports SIAM view of excluding auto sector from FTA

19 January 2013

Agencies : New Delhi/Luxury carmaker Mercedes Benz India said it supports industry body SIAM’s position on not including automobile sector in the proposed free trade agreement with European Union.

The company further said it may consider making its facility at Chakan as an export destination if FTA comes into effect for the auto sector.

"We are completely in line with SIAM position. If FTA comes in, we will discuss how to utilise our plant for optimum output. Exports from our Chakan plant could be one option at that time," Mercedes Benz India Managing Director and CEO Eberhard H Kern told reporters here.

Society of Indian Automobile Manufacturers (SIAM) has been opposing inclusion of the auto sector in the proposed Indo-EU FTA and is saying that bringing down duties for cheap imports will devastate the domestic players, risking jobs.

Asked about its stand along with with SIAM contradicting with that of EU and other German auto major, Kern said: "EU is not a homogeneous situation.

"We are quite flexible having our own factory here and having factories around the world. We believe in India and believe in our production here. The Chakan factory is a 100 per cent Daimler entity and we will find solutions for its optimum usage (if and) when FTA is implemented."

He said the company’s Rs 850 crore investment plan till 2014 for expanding the production capacity and introducing new models is on track.

Talking about Mercedes Benz slipping in to third position in the Indian luxury car market, Kern said: "It was not so normal situation that all the three German biggies (BMW and Audi) are in one market. Nothing went wrong for us. Moreover, one cannot have a monopoly for a long time."

Sales of the company declined due to "some life-cycle issues" and it never chased absolute volume, he added.

"We want to be the number one again by 2016 in India in terms of products, brand, profit and also volume," Kern said.

He said the company’s most of the future products will be in the entry level segment with prices starting from Rs 20 lakh and above.

Mercedes-Benz India will launch its premium hatchback A-Class in the country during middle of this year and it will be its entry-level car here, he added.

The company, which has already launched the petrol version of its smaller car B-class, will be launching the diesel version of the car this year.

"In our global roadmap, India is one of the most important strategic market. Looking at the size of the market and number of young people, India will become a big market for us in future," Kern said.

The company on Friday inaugurated one of the largest showroom for luxury cars in in the country in south Delhi. The showroom is spread over an area of 60,000 sq ft.