BMW's strategy in India has shifted from aggressive volume sales to sustainable, profitable growth, focusing on high-end models like the i8 hybrid. The company has increased localization efforts, allowing for reduced prices on locally produced models while targeting the top luxury segment of the market. Recommendations include maintaining premium pricing for high-end models, investing in R&D, and expanding into emerging markets.

1. Pricing Strategies | Bavarian Motor Works | Group-01

2. March, 2007 : BMW sets up Production Plant in Chennai
Timeline | BMW in India
November, 2010 : BMW enters Pre-Owned Car Business
2010-11 : BMW becomes top selling luxury Car in India,
Surpasses Mercedes with 42% Market Share
2013 : Customs Duty controversy regarding Imported Semi-
Knocked Down cars in India, followed by 5% price hike
2014: BMW tops Customer Satisfaction Study, decides
not to release Sales data officially
2015: ‘Make In India’ wave | Increased Localization of
X5,MINI range | Plans 15 new launches this year

3. STP
Industrialized Areas
Age Group: 25-40
Safety & Satisfaction
Innovation
Powerful
Brand Image
Technology
Performance
Customer
Satisfaction
Quality
Exclusivity
Sheer Driving
Pleasure
Reliability
Premium-tization
Consumers triggers the
demand & are willing to
pay high price for the
perceived quality

4. Varying Product Range at Different Price Levels (India)
BMW Car Model
Approximate Price
Range (INR)
1 Series 26-30 Lac
X1 Series 31-38 Lac
3 Series 35 Lac - 1.2 Cr.
3 Series GT 44 Lac
X3 47-52 Lac
5 Series 48-60 Lac
X5 75 Lac
Z4 75-77 Lac
X6 1.15 Cr.
6 Series 1.15-1.22 Cr.
7 Series 1.08-1.98 Cr.
4 Series 1.27 Cr.
I8 Series 2.8 Cr.
Latest Launch : MINI Series

5. ‘Profitability’ over ‘Volume’ strategy in India
 Till 2012, BMW was extremely aggressive on volumes and had discounted some of
its model like the X1 dramatically and had introduced corporate editions of 3 Series,
to buy the market. But the move hurt the brand image.
 Now, the company’s focus is not on volumes, but on a Sustainable & Profitable
growth in India. And it is willing to let go of volumes at the cost of profit.
 BMW wants to focus on the top of line products, like the i8 Hybrid launched in
Mumbai (at Rs 2.29 crore) recently and its M models sports cars and cars upwards of
3 Series. Interestingly, the 1 Series and X1 helped BMW three years ago to climb to
the top position in India, from where it has dropped to the third by the end of 2014.
 The entry luxury segment where cars are priced between Rs 25 lakh and Rs 45 lakh
already makes up for 20-25% of Mercedes Benz's India sales, compared with 5-10%
at BMW. That’s why- the top of the pyramid luxury and performance car segment
where vehicles are priced between Rs 50 lakh and Rs 2 crore becomes BMW’s prime
focus market for nearby future.

6.  BMW has successfully implemented 50 % increase in localization of its products.
Cars like BMW 1 Series, 3 Series, 3 Series Gran Turismo, X1, X3, X5, 5 Series as well as
7 Series model that are locally produced will now be available at low cost (Reduced
Price up to 5 lac INR).
 India remains the most ‘Aggressive’ market for BMW. They’re following ‘Production-
follows-Market’ strategy by offering more range of luxury cars ( locally mfg. at
reduced cost).
 Launch of MINI Cooper & Countryman series in the range of INR 29-36 Lac.

7. Recommendations
To Maintain
Premium Luxury
Car Image &
Maximize Profits
Reduce Mfg. Costs
by Technological
Innovation
Expansion into
Emerging &
Developing
Countries
Don’t Reduce
funding for R&D
Add more
smaller/cheaper
cars like MINI
Cooper
• Pricing should remain
Premium for High-end
Models
• R&D will help in
developing further
automation that can
reduce Mfg. costs,
Investment in
Emission Reduction
Technology
• To support local
manufacturing
initiatives of
countries like
India
• India, China,
African Fuel
producing
Countries,
Australia etc.