BMW India launched its third electric vehicle in the span of six months, the i4 sedan, at an introductory price of Rs 69.90 lakh, ex-showroom India. According to BMW, the i4 offers a range of 590 km, the best in the country. We caught up with Vikram Pawah, President and CEO, of BMW Group India, who talks about the German manufacturer’s upcoming lineup for this year and the EV sector.
The aggressive pricing of the i4 has taken everyone by surprise. How has BMW managed to achieve this?
We have a clear strategy of launching fantastic products with great value and this applies to our entire model line-up. We have always priced our products based on the segment they belong to like in the case of 3 Series Gran Limousine, the iX SUV and even the Mini hatch. Similarly, the i4 is the first all-electric mid-size sedan in India and its pricing is based on the mid-size segment.
The automotive sector bears the brunt of high taxes, especially on completely built units. How does that translate to the EV segment?
The overall taxation and duties in the auto segment are quite high. When we look at the price of a car, almost 60 per cent of the price in the premium space could be just duties and taxes. So any kind of relief from the government allows us to offer good value for our products. In electric vehicles, the government has done fantastically well. With the reduction of GST to 5 per cent for electric vehicles, I think that’s a clear and encouraging sign that there’s an action plan by the government to back up the ambition of 30 per cent of electric mobility. That helps us to give the latest and the greatest products to the country.
What are the major challenges you see in the EV sector?
Infrastructure is the biggest one. I think the debate always revolves around the infrastructure and the demand because they are co-related. Infrastructure is the key. In addition to that, there are three more things that are very important. One is the stability of the policies to make sure that the incentives for the registration tax or the GST or the income tax benefits that are there for the EVs must continue for some time. This allows the adoption of EVs for a longer time. Ambition is something that we have to achieve and what we have set for. We can make India an electrified country and I think that’s the right way to go. Third, as an economy, we are strong.
There are many different alternative fuel options like hybrids, which many companies have invested in. Do you see that as a viable option for India?
The viability comes from the customer’s benefits part. Currently, we can bring in any plug-in hybrid electric vehicle, but unfortunately, there is no incentive for the customer to adopt it. So, they will end up paying a higher price for the minimum benefit. That price benefit equation needs to be right. If the policy changes then surely a plug-in hybrid is a good solution for India.
What is the line-up for BMW India this year?
This year we will launch 25 products across the four-wheelers and two-wheelers space. We continue to add to our portfolio every year and we will continue to excite the market.
Pre-owned marketing has been doing well, but post-pandemic, we have the demand increasing in many folds. How has that market done for BMW?
The main benefit of the pre-owned market being buoyant is for the customers. That means the resale value of our customer’s vehicle goes up. This means bridging to the new car becomes much easier. It’s a great ecosystem to have with the resale values up, people can change their cars more frequently. That fuels the overall economy and the industry.