Jean-Philippe Parain, Senior VP, BMW: The Middle Class is Key in India

BMW India has seen over 20% growth in the first half of this year. We’ve been expecting exponential growth for many years in India, so is this level of growth sufficient or do you think we should expect even more in the near term?

In India, over the last three years, we have seen very consistent two-digit growth. And that’s good. Consistency is important. Could it accelerate? Yes. If we see the share of the total market that is premium in India, it’s relatively low. It’s only 1%. China is 8%. So, I think there is still growth potential. So, it could accelerate, but consumer sentiment can also shift, and it can also slow a bit. So, what is important is long-term growth, and we believe that there is a long-term growth path in India, definitely.

What are the key factors in India, and what does the Indian market need in order to achieve exponential growth for multiple years going forward?

This is mainly due to consumer sentiment, economic growth, and the fact that people in the middle class want to express their success by purchasing luxury products. I think this is definitely growing in India, generation after generation, and I think this must remain. But, at the moment, the world is very volatile. The global economy is not developing as well as in the past two or three years. So, for sure, we will also have fluctuations in the Indian market.

In times of instability, we tend to see that absolute top-end of the market stay unaffected. At present, the i7, the 7 Series, and the X7 are all doing really well, even in India. Do you think the top end of the market is where you can see more growth versus the emerging luxury segment?

Well, if I look at what we call GKL sales, so it is our top luxury segment, 7 Series and i7, have grown 17% worldwide versus overall growth of 2.5% worldwide for the first six months of the year. So, I think it shows that indeed. In India, this segment in our total sales represents 18% of sales. So, it is quite important. And I think, yes, for sure there is more potential here.

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Do you think that with the long wheelbase and the extra luxury, the new 5 Series is going to be a game changer?

I believe if there was one Series where we were a bit weaker than our traditional competition, it was the 5 Series, because our competitors were partly offering long wheelbase versions and I believe, for the Indian customers, it is very important to have more space in the back, more comfort and more luxury. And we are offering it right now in the long wheelbase 5 series. So, it perfectly fits the needs of the Indian customers, with great comfort, great luxury, and great technology in the car, and the same driving pleasure – and also a very sporty appearance, with this M Sport package. So, I think we have a great offer, and we offer it at a price where I think the value perception is high.

You have already launched the i5, which is the electric version of the standard wheelbase 5 Series in India. Who do you think is the customer for a traditional internal combustion engine 5 Series, and who is the customer for an electric 5?

I guess for sure the ones who are more progressive will want to try electric mobility. They want to experience that. Today, we know out of concrete customer data that in India our customers are doing roughly 45 kilometres per day in a car. So, it’s perfect for the usage of an electric car. They charge only once a week. As taxes are also lower on electric cars, there is also an incentive towards purchasing an electric car here in India.

What's next from BMW in India?

We are very carefully looking at how this long wheelbase 5 Series will pick up. And if we see again a good success, then we might look at other segments too.

(Jean-Philippe Parain: With a wealth of experience since he joined the company in 1997 at BMW France in the marketing department, Parain has held several senior management roles including President and CEO BMW Group Belux, Head of MINI Europe and Senior Vice President Sales Region Europe.)