Mercedes-Benz India is exploring possibilities of bringing its financial services arm to India. This would provide a boost to its commercial vehicles business in India, where the company sells high-end buses and trucks. Peter Alexander Trettin, president & CEO, Daimler Central/Eastern Europe, Africa & Asia, said the financial services business will not compete with the banks and existing financing options but offer an additional opportunity to customers. It is not easy to sell buses without financing options, he said.
?We are looking at this business model and checking it out,? Trettin said. He said the market needed to be of a reasonable size to enter and they were looking at opening this door. The company has a broad experience in the financial services business and also a network to resell its products, he said. The company?s competitors have already walked down this road. BMW has brought it its BMW Financial Services arm to India and is slated to start operations soon after regulatory approvals. However Mercedes has been taking its time to take a call on this foray.
A growth in the commercial vehicles business in India could drive this new business. Trettin said the commercial vehicles market in India was doing well unlike other markets, which had seen a 90% fall in demand. Eastern Europe and Central Europe was suffering. The company had to buy back stock from dealers and distribute it in other markets, Trettin said. The Middle East too saw a dip in the CV market. From 24,000 trucks and 24,000 van sales in 2008, the company?s 2009 sales were 9,000 trucks and 9,000 vans. While there were no signs of recovery in the commercial vehicles segment in these markets, the India the growth rate was much higher that in other markets, Trettin said.